Incentive Compensation Plan
Approximately 50 Abrams line and staff managers participated in an incentive bonus plan. The dollar amount of the corporatewide bonus pool was established by a fixed formula linked to corporate earnings per share. Each participant in the bonus plan received a number of standard bonus points. The higher the participant was in the organizational hierarchy, the more standard points he or she received. The total of these points for all participants was divided into the total bonus pool amount to arrive at a standard dollar award per point. Then, this standard rate was multiplied by the participant's number of standard points to arrive at the participant's standard bonus dollars. However, the actual bonus could vary (upward or downward)by as much as 25 percent at the discretion of the participant's superiors.