Characteristics of performance indicators in incentive systems of brazilian automotive industry

Abstract

This paper provides a general overview of the performance indicators used by Brazilian Automotive Industry in its profit sharing agreements, named PLR agreements. The 39 PLR agreements analyzed had their performance indicators classified in six groups: financial, quality, flexibility, productivity, customers and human resources. The results show a massive presence of traditional non-financial indicators, whereas performance indicators to cover social-environmental aspects have not been found. The predominance of indicators related to productivity and quality raised the possibility that in economic cycles with industry activity expansion, the non-financial indicators can be used as proxies of financial indicators. After analyzing the results, it was suggested that, in future, the study of the indicators basket should include its relations with strategic position, technological sophistication and other factors that impact the selection of indicators.