In the spring of 2003, two professors from a couple of New York universities were allowed examine the filings of those companies that had complied with the filing requirement. They wanted to know which and how many companies paid the bulk of their end-of-year bonuses to the top five people in the company, and which and how many paid the bulk of the bonuses to all of their employees. The majority paid 99% to the top five employees; only one company paid 1% to the top five employees and the remaining 99% was distributed evenly to the remaining employees down to the lowest level – the custodians. The company was S.C. Johnson of Racine, WI, manufacturers of Pledge, Scrubbing Bubbles, Windex, and other popular household products. Interestingly, S.C. Johnson was the most profitable manufacturer in the U. S. that year.
For your initial post, address the following:
Post your thoughts and reactions.
Who should be eligible for incentive awards?
If you were to consider other companies, should the reward system vary among manufacturers, retailers, distributors, financial organizations, et al?
What other characteristics should good performance incentives have? Do those characteristics cause the implementation of incentives to differ across various functions of a company?