The Structure of White-Collar Compensation and Organizational Performance

O’Shaughnessy, K. C.

doi:10.7202/005296ar

Cited by 5 publications

(2 citation statements)

References 52 publications

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“…However, it can be said that our results are generally in line with the earlier findings of the literature on performance evaluation in incentive plans. For example, our finding that PRP payments account for a higher share of total earnings for white‐collar employees than for blue‐collar workers supports the results by O’Shaughnessy (1998), who concluded that the relationship between the bonus to base ratio and performance is stronger higher in the organizational hierarchy. Furthermore, the results of Murphy (1999, 2000) show that in executive incentive contracts, typically (1) the performance measures include a measure of profitability, (2) multiple measures are used, and (3) bonuses are capped.…”

Section: Resultssupporting

confidence: 88%

Performance Measurement and Incentive Plans

Kauhanen¹,

Napari²

2012

Industrial Relations

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. ABSTRACT: This paper explores performance measurement in incentive plans. Based on theory, we argue that differences in the nature of jobs between blue-and white-collar employees lead to differences in incentive systems. We find that performance measurement for white-collar workers is broader in terms of the performance measures, the organizational level of performance measurement and the time horizon. The intensity of incentives is also stronger for white-collar employees. All of these findings are consistent with theory. Terms of use: Documents in

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Section: Resultssupporting

confidence: 88%

Performance Measurement and Incentive Plans

Kauhanen¹,

Napari²

2012

Industrial Relations

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“…Because WCEs are neither blue-collar workers (BCEs), who exert substantial physical effort in their routine tasks, nor top management, possessing extensive decision rights, the performance effects of incentive systems for WCEs still remain an unexplored empirical topic (e.g. Belfield and Marsden 2003;Kauhanen and Piekkola, 2006;O'Shaughnessy 1998). Given the central role of financial incentives in organizational functioning and for employees at lower hierarchical levels (Kihn, 2007;Du, Deloof and Jorissen, 2013), research is needed on the association between incentives at lower hierarchical levels and firm performance.…”

Section: Introductionmentioning

confidence: 99%

Do White-Collar Employee Incentives Improve Firm Profitability?

Ikäheimo¹,

Kallunki

Moilanen

et al. 2017

Journal of Management Accounting Research

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We use proprietary archival compensation panel data from Finnish white-collar employees (WCEs) over the period of 2002 to 2011 in order to examine the relationship between performance-based incentives for WCEs and the future profitability of the firm as well as to determine whether this association is moderated by task complexity. While many studies examine the determinants and performance effects of CEO compensation, virtually no evidence has been presented to indicate that explicit financial incentives for WCEs improve the profitability of the firm. Our empirical results show that performance-based incentives for WCEs are significantly positively related to the future return-on-assets, return-on-equity, and profit margin ratios of the firm. We also find that this effect comes from the performance-based incentives for low-level WCEs, corroborating the importance of implementing performance-based incentives also to low-task complexity jobs. JEL Classifications: M40.

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Demystifying demotion: A look at the psychological and economic consequences on the demotee

Carson

2007

Business Horizons

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The Structure of White-Collar Compensation and Organizational Performance

Abstract: Volume 53, numéro 3, été 1998 URI : id.erudit.org/iderudit/005296ar

Cited by 5 publications

References 52 publications

Performance Measurement and Incentive Plans

Performance Measurement and Incentive Plans

Do White-Collar Employee Incentives Improve Firm Profitability?

Demystifying demotion: A look at the psychological and economic consequences on the demotee

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