Budgeting and behaviour - part 2
Understand how financial incentives and bonus structures influence manager behaviour and decision-making within organisations. This lesson examines the risks of short-termism created by excessive performance bonuses, and explores practical strategies for aligning manager rewards with long-term organisational objectives while maintaining ethical standards and sustainable business practices.
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In this lesson
- 0:00 Introduction to Managerial Incentives
- 0:44 Dysfunctional Behaviour Explained
- 2:03 Balancing Incentives and Targets
- 2:48 Addressing Short-Termism
- 4:45 Strategies to Promote Long-Term Thinking
- 6:34 Setting Quality-Based Targets
About this lesson
Delve into the delicate balance between motivating managers with financial incentives and avoiding detrimental short-term decisions in "Budgeting and Behaviour - Part 2". This video explores how excessive bonuses can lead to unethical behaviours that compromise long-term business health, demonstrating the importance of setting realistic targets and aligning manager rewards with the company's long-term success. Learn strategies to foster a long-term perspective among managers, ensuring their actions benefit the organisation as a whole. Watch now for insights into creating a more sustainable incentive system.
Duration: 7m
- Managerial incentives and motivation
- Dysfunctional behaviour in budgeting
- Short-termism and its organisational impact
- Target-setting and realistic budgets
- Long-term incentive alignment
- Quality-based performance metrics
Transcript
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