Managers play a crucial role in divisional and company wide profitability and most firms therefore put considerable thought into how to reward them. Most managers get short term and long term incentives in addition to salary. For firms offering short term incentive plans, virtually all – 96% — provide those incentives in cash. For those offering long term incentives about 48% offer them as stock options. The latter are intended to motivate and reward management for long term corporate growth, prosperity and share holders value. For mature companies’ executives base salary short term incentives long term incentives and benefits might be 60%, 15%, 15% and 10% respectively. For growth companies, the corresponding figures might be 40%, 45% 25% and 10%. About 69% of companies in one survey had short term incentives although nearly a third of those said they didn’t consider them effective in boosting employee performance. We’ll look at short and long term, incentives.