Background Note | HBS Case Collection | March 2002

Incentive Strategy Within Organizations

by Brian J. Hall

Abstract

This case serves as a supplement to any course on incentive design and implementation. The analysis first locates incentive strategy within the larger structure of organizations and markets and then helps to define the central components and difficulties of incentive design. The case focuses on the principal difficulties in implementing incentive systems, including the trade off between objective and subjective performance metrics, how to design incentive systems in team environments, and the inherent problems with designing incentive systems in environments where workers are involved in multiple activities.

Keywords: Motivation and Incentives; Compensation and Benefits; Performance Evaluation; Strategy; Situation or Environment; Problems and Challenges;

Citation:

Hall, Brian J. "Incentive Strategy Within Organizations." Harvard Business School Background Note 902-131, March 2002.