Who’s in charge of designing incentive plans?

There is a common theme among failed incentive programs — a lack of commitment and ownership
By David Johnston
|CHRR, Report on Total Rewards|Last Updated: 10/07/2005

Most organizations use some sort of an incentive compensation program to influence the behaviour or performance of staff. Some have been spectacular in their success, others equally stellar in their dismal failure. Most have had, at best, modest success.

There is no easy answer as to why incentive programs fail because, like many other organizational initiatives, they die slow and somewhat inconspicuous deaths. Or they are replaced with the better, newer version that soon meets the same fate as the plans before it. But if one digs deep, there is a common theme among failed incentive programs — a lack of commitment and ownership.

Many individuals and groups play important roles in the design and evolution of an incentive compensation program.