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1. The first point about the current bonus system is one that can be viewed as either a pro or a con – the fact that the bonuses are based on a company-wide performance. On the positive side, a bonus structure based on overall company performance displays a unitary goal as the main objective. This means that either everyone in the company enjoys the fruits of success or nobody does. Negatively, this also means that if a specific division has a great year, but the overall company doesn't perform that well, the people involved with the excelling division aren't rewarded financially for all of their hard work.

The current bonus system also only allows for bonuses to be distributed if there are profits more than 10% (after taxes) in excess of 12% of the company's net book worth. If profits are low, then no bonuses are distributed. This was the case in years 2000 and 2001 when IE was adversely affected by the economy recession – there was no money in the bonus pool at all.......

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Approximate Word Count: 1109
Approximate Pages: 5 (250 words per double-spaced page)

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