Identify Problems:
Facing intensified competition, CDM expanded rapidly and had grown into a global consulting and engineering services practice of more than 2,900 individuals with 90 offices throughout the world by 1999. CDM’s growth was slowing down.
Despite CDM had a complex appraisal and incentive system (BIPS program + annual review for staff not in the BIPS program) and paid out millions of dollars in incentives, part of CDM employees were not affected or properly motivated by the incentive system. The incentive problems would impact on CDM’s culture and long-term performance.
CATWOE Analysis:
Customers: CDM employees
Actors: CDM management, HR Department, Compensation Committee & Appraisal Committee
Transformation: employees not well motivated  effectively motivated employees
Worldview: The belief that an appropriate incentive program can influence employees’ behavior positively, and motivate employees to work toward the company goals.
Owners: The board of directors of CDM
Environmental constraints: Increased competition and declining profits, the slowdown of CDM’s growth, business margins not enough to expand incentive pool.
Root Definition:
A system to
X (What the system does): influence employees’ behavior and performance, hence motivate people to do what is best for the firm (sell, do high quality work, budget, collect cash & take care of their people)
Y (How it does): by means of objective and measurable appraisal process, fair structure and promotion system, and reasonable reward system.
Z (why it’s being done): in order to push CDM’s business further, help CDM achieve its strategy goals, compete successfully in intense competition and improve long-term performance.

Analyze Problems:
Ownership Structure versus Employee Structure CDM titled employees (13% of total employees) owned 98% of CDM. CDM was owned 98% by its