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Case
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Reference no. 9-189-096
Subject category: Finance, Accounting and Control
Authors: Lourdes Ferreira (Harvard Business School); Kenneth A Merchant (Harvard Business School)
Published by: Harvard Business Publishing
Originally published in: 1988
Version: 28 February 1990
Revision date: 21-Jul-2020
Length: 16 pages
Data source: Field research
Topics: Control systems; Management by objectives; Goal setting; Planning systems; Incentives; Budgeting
Share a link: https://casecent.re/p/47327
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Abstract

Describes a corporation that switches its philosophy of budgeting from 'stretch' targets to 'minimum performance standard' targets. The change has implications for management incentives, compensation, and corporate planning. Early results suggest the concept was not implemented well, even if it was a good idea.
Location:
California
Industry:
Pumps & seals
Size:
USD36 million annual revenues
Other setting(s):
1987
Teaching note
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Reference no. 5-190-199
Subject category: Finance, Accounting and Control
Authors: Kenneth A Merchant (Harvard Business School)
Published by: Harvard Business Publishing
Originally published in: 1990
Version: 17 May 1990
Length: 7 pages
Data source: Field research
View full details

About

Abstract

Describes a corporation that switches its philosophy of budgeting from 'stretch' targets to 'minimum performance standard' targets. The change has implications for management incentives, compensation, and corporate planning. Early results suggest the concept was not implemented well, even if it was a good idea.

Settings

Location:
California
Industry:
Pumps & seals
Size:
USD36 million annual revenues
Other setting(s):
1987

Related

Teaching note
-
Reference no. 5-190-199
Subject category: Finance, Accounting and Control
Authors: Kenneth A Merchant (Harvard Business School)
Published by: Harvard Business Publishing
Originally published in: 1990
Version: 17 May 1990
Length: 7 pages
Data source: Field research
View full details