1. Nucor gives its employees a relatively great say in decision making along with compensation tied to performance. Discuss how incentive pay could be more effective when it is linked to greater authority and room to innovate.
2. When times are tough, incentive pay falls even if employees are trying hard. In that case, should companies find other ways to reward employees? Why or why not? Evaluate Nucor’s use of a “special bonus” in this situation.

Nucor is not your average steel company. Compared with its traditionally managed competitors, Nucor is aggressive about pushing decision making down to the lowest levels of the hierarchy, and it links two-thirds of pay to performance, specifically production levels. That strategy has opened the company up to employee-driven changes that have made the company efficient, flexible, and innovative. Its use of new technology in the form of electric arc furnaces lets the company shut down and start up operations faster to meet demand for its process of melting down scrap metal and shaping it to meet customers’ needs.