Incentive compensation for employees, such as bonuses, should be tied to balanced scorecard performance measures regardless of how long the scorecard has been in place.

Question

Quizplus · Accepted Answer

The effectiveness of tying incentive compensation to balanced scorecard measures depends on the maturity and stability of the scorecard system. If the system has not been in place long enough to be reliable and understood by employees, linking compensation directly to it may be premature and potentially counterproductive.

Incentive Compensation for Employees, Such as Bonuses, Should Be Tied