Daktronics is a leading manufacturer of dynamic visual communication display systems, most notably LED displays. It's recent entrance into the rapidly growing Chinese marketplace requires an incentive pay program that facilitates the achievement of organizational strategies and improves organizational effectiveness, there in this hyper-competitive market. As such, two sets of steps in program design will be utilized.
             The first set of steps is that laid out by Holmes (2005). Holmes outlines a five-step program for creating a diversity program, which can be applied to this incentive pay program. These include: clarification of the benefits of the diversity program, identification of SMART goals, development of action plans, definition of performance expectations,and evaluation of impact on performance. The second is the steps outlined by Becker and Huselid (2003). These three steps include: clearly defining the business strategy, drawing a map of the casual flow of strategy execution, and linking of HR architecture to the strategy map.
             Incentive pay programs have been implemented for generations. In these programs, employees are rewarded depending on "measured changes in performance according to predetermined rules" (cited in "Incentive pay plans", 2007). When designed and implemented correctly, incentive pay programs can increase employee efficiency and efficacy, thus increasing productivity, when compared to their base salaried peers. As Pfeffer (1998) notes, labor costs and labor rates are not directly associated. An organization can increase their labor rates and actually decrease labor costs, and vice versa.
             Benefits of the Incentive Program to the Organization:
             There are several benefits to implementing an incentive program for the Daktronics' employees in their newly created China location. First, it can lower base salary costs for employees
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