Creating Proper Incentives

Creating Proper Incentives - performance so that it will be...

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Creating Proper Incentives (motivations) Companies like Motorola , IBM , and Nike use complex systems to control and evaluate the actions of managers. For example, companies prepare budgets to provide direction. Because the budget is also used as an evaluation tool, some managers try to “game'' the budgeting process by underestimating their division's predicted
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Unformatted text preview: performance so that it will be easier to meet their performance targets. On the other hand, if the budget is set at unattainable levels, managers sometimes take unethical actions to meet the targets in order to receive higher compensation or, in some cases, to keep their jobs....
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This note was uploaded on 12/25/2011 for the course ACCOUNTING ac 202 taught by Professor - during the Fall '11 term at Montgomery.

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