Organizations compensate their employees in a variety of ways in order to motivate them. Compensation may be offered at the individual, group, and organizational level, depending on what type of performance is to be rewarded. Compensation plan elements use principles of equity theory, expectancy theory, and goal setting theory in order to encourage direction, intensity, and persistence of effort toward organizational and individual goals. In addition, the motivational impact of compensation plan elements can be focused at the individual, unit, and/or organization as a whole. The following descriptions illustrate ways that organizations may use a variety of compensation plan elements.