The DuPont Case Is a Good Example of an Incentive

question 23

Essay

The DuPont case is a good example of an incentive package gone awry.In review,it placed a portion of employee's pay into an "at-risk pool." If the division had exceeded expectations,the employees would have received a bonus from the pool.How would a "relative performance contract" have saved the DuPont bonus system?

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Definitions:

Successor

An entity or individual that follows or comes after another in a specific role, position, or sequence.

Pessimistic Time

The “worst” activity time that could be expected in a PERT network.

Unfavorable Conditions

Circumstances or situations that are detrimental to the success, operation, or performance of a process, project, or activity.

Activity Variance

The difference between budgeted and actual cost or time spent on a particular activity, highlighting variances in performance.