Case | HBS Case Collection | March 2011 (Revised March 2012)

Arck Systems

by Ian Larkin


The Arck Systems series of cases describes the dilemmas faced by a senior sales manager in determining a sales compensation plan at an enterprise software company. The existing compensation plan is aggressive and highly rewards "star" performers. The cases track a series of changes the manager makes to the sales compensation plan in response to negative and unintended consequences of the existing system. The cases illustrate the tradeoffs inherent in incentive plans (even outside of sales environments) and presents a framework for the design and management of incentive systems. It also is useful in addressing employee response to incentive system change.

Keywords: Compensation and Benefits; Retention; Performance Effectiveness; Salesforce Management; Motivation and Incentives; Software; Information Technology Industry;


Larkin, Ian. "Arck Systems." Harvard Business School Case 911-056, March 2011. (Revised March 2012.)