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Gainsharing Incentive Plans

1. What are gainsharing incentive plans?

2. Identify at least ten (10) characteristics that contribute to the success of some gainsharing plans.

3. Identify at least five (5) factors that contribute to the failure of some gainsharing plans.

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1. What are gainsharing incentive plans?

Gainsharing incentive plans are programs in which an organization wants to achieve higher levels of performance through the participation and involvement of its' employees. It is set up so that as performance improves towards the organization's goals (and thus profits), employees share financially in the gain. It is a team approach in that all the employees in the operation are included. Typically in a Gainsharing organization performance is measured and a pre-determined formula is used to share the savings with employees. The organizations actual performance is compared to a baseline performance (this could be a historical standard or a set time period to determine the amount of the gain. Employees then share in the bonus (if there is a gain) on a set periodic basis (this may be weekly, monthly, quarterly or annually). Typically ...

Solution Summary

This solution explains gainsharing incentive plans, and identifies 14 characteristics that contribute to the success of some gainsharing plans, and six factors that contribute to the failure of some gainsharing plans.APA reference is included.

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