In bad times as well as good, many companies have success with linking manager compensation to attainment of objective goals. Incentives make compensation depend directly on performance. The effectiveness of incentives, however, depends on their significance and timing. They will not be paid at all in a company that chronically loses money, for example. Incentive compensation starts with defining goals. There are various measurements for determining progress toward goals. Depending on the manager's responsibilities, one or more of them can be applied. The following are some in widespread current use: 1. sales, 2. gross profit, 3. controllable expenses, 4. non-financial statistics, 5. net income, 6. operating profit, 7. earnings before interest, taxes, depreciation, and amortization, 8. return on assets, and 9. economic value added. In designing an incentive, the amount must be planned. The safest approach is to base incentive only upon improved financial performance. Potential mismatches between objectives must be considered.