Profit‐sharing frequently is used to link employee performance and labor costs to the profitability of organizations. It represents a significant investment. Yet, managers' decisions regarding such human resource investments frequently do not use the same financial planning frameworks typical of other investments. This article presents a case study describing how one division at Eastman Kodak Company used a strategic investment approach to plan and evaluate a profit‐sharing program and describing the role of performance measurement information in that approach.
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Boudreau et al. (1991) studied this question.
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