Incentive plans can be one method of encouraging certain behavior within an organization. Healthways has an incentive program which is pay for organizational performance. According to Noe, et al, an effective performance plan should be linked to an organizations goal and employees should believe they can meet performance standards (Noe, Hollenbeck, Gerhart, & Wright, 2004).
Incentives linked to profits and stock prices have a degree of risk for the employee. Profits and stock prices can fluctuate and in doing so, can effect the incentive to the employee. Incentive plans linked t…