When tying compensation to the balanced scorecard, management must ensure that the performance measures have all the following characteristics except:
A) Reliable.
B) Sensible.
C) Understood by those who are being evaluated.
D) Easily manipulated.

Question

Quizplus · Accepted Answer

The characteristic of being easily manipulated would undermine the fairness and effectiveness of the balanced scorecard system. Therefore, this characteristic should not be present in the performance measures tied to compensation. The other three characteristics (reliability, sensibility, and understanding) are important for ensuring the validity and acceptance of the system.

When Tying Compensation to the Balanced Scorecard, Management Must Ensure