A pair of studies in Compensation & Benefits Review make clear that creating pay rewards based on team success for American white-collar workers remains a challenge.
The first compared the attitudes of Japanese MBA students with those of American MBA students from an earlier study on compensation practices. In the Japanese sample, group rewards were the second-most powerful predictor of their employer organizations' performance (after praise from their managers), but in the American sample group rewards had no effect. This is consistent with earlier reports in TeamResearch News about the effect of culture on team-related attitudes.
However, nearly 3/4 of the American students' employers (and 4/5 of the Japanese) were service firms, government, or nonprofits: white-collar organizations, in other words. The second study looked at a cross-section of Midwestern U.S. companies and found that group-based rewards raised blue-collar workers':
The only effect group pay had on white-collar workers was slightly negative, hurting satisfaction with pay and sense of pay fairness.
Sources: Allen, R., et al. (04), "Rewards and Organizational Performance in Japan and the United States: A Comparison"; Howard, L., and T. Dougherty (04), "Alternative Strategies and Employee Reactions": Compensation & Benefits Review 36(1):7 & 41.
TeamResearch News summarizes the latest information from studies or expert articles on business teams. It is published as a free service of TeamTrainers Consulting.
© 2009 by Jim Morgan. All rights reserved.