Question

Horizon Inc. wants its employees to focus on organizational as well as individual goals. It also wants to motivate its employees to contribute toward increasing the company's shareholder value. It has implemented a variable pay plan that links incentive payouts to the company's financial targets. Horizon believes that this plan would help it clearly communicate its priorities to its employees. However, the downside of this plan is that the employees receive reduced payouts if the company's financial targets are not fulfilled. Which of the following variable pay plans is Horizon most likely using?

A balanced scorecard plan

The Rowan plan

The Merrick plan

A stock ownership plan

Answer 1

Answer= A balanced scorecard plan

Reason= A balanced scorecard plan can be seen as the strategic planning tool in which the organization communicates the strategy to its employees, the relative importance of the various goals, projects, products, and services. Thus when this plan is implemented, it will focus on the organizational and the individual goals on the basis of their priorities