The purpose of this paper is to relate the balanced scorecard (BSC) to strategy and teams.
This paper proposes deriving performance targets and weights using a multiparty collaborative decision model that can be integrated into team-based bonus formulas.
Cross-functional division managers face a more complex problem in setting goals for individual managers. The proposed approach is intended to develop such goals and link them for team-based incentives. An example illustrates the application of the proposed BSC model and the team-based pay formula.
The model can be used to determine group bonus.
The paper has two objectives: to relate the BSC to the team setting with a participative flavor rather than with imposed targets and weights, and to develop a better way of relating behaviors and outcomes to the team’s and/or the organization’s goals. Integrating the strategies of various units adds a new dimension that differs from rationalizing the superior’s and the subordinate’s goals. The proposed model considers input from all value chain functional managers involved in implementing an organizational strategy. A methodology is provided to operationalize (Hope and Fraser, 2003) beyond the budgeting model principles.
Herath, H.S.B., Bremser, W.G. and Birnberg, J.G. (2019), "Team-based employee remuneration: A balanced scorecard group target and weight selection-based bonus allocation", Accounting Research Journal, Vol. 32 No. 2, pp. 252-272. https://doi.org/10.1108/ARJ-11-2016-0148
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