The following is a case study analysis of Duckworth Industries; more specifically, it is an analysis of the company's multiple incentive compensation programs. The history of the company is rather remarkable. Mr. Duckworth created his own company in 1971 and has evolved it into a $125 million company by 1992. As president and controlling shareholder of Duckworth Industries, Inc., Mr. John Duckworth wanted to adopt a new incentive plan in efforts to integrate the interests of both shareholders and management of his company. He believed that managerial actions could be guided with the power of incentives. In the following pages are answers to five questions given in the course module regarding Duckworth Industry's compensation plans. The first and second question asks to determine the various incentive plans implemented and identify what problems it addresses. Being strong proponents of incentive plans, Duckworth Industries implemented numerous plans to address various problems. To address tardiness, Duckworth applied an attendance bonus. This meant that during every pay period, an additional $0.60 per hour was earned for those who were never more than two minutes tardy. To ensure quality performance, a quality incentive plan was adopted. Quality was measured based on the number of customer complaints or meeting designated shipment dates. This specific plan gave plant level employees to the supervisory level an additional $100 per month. The pool was equal to 15% of profits before tax in which at the end of the year the pool were given to employees pro-rata, which was based on the employees pay. The individual incentive program was directed to personnel involved in sales and supervisory roles giving them a monetary incentive ranging from 10 to 40% of their base pay.
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