Organizational Culture and Performance-Based Compensation in Family Firms: Does Family Involvement in Management Matter?

Abstract

Performance-based compensation policy 1. The firm has assessed employees' performance based on objective and quantifiable results 2. The firm has assessed employees' performance based on multiple sources 3. The firm has given feedback to employees based on their performance appraisals 4. The firm has paid employees based on their performance 5. The firm has guaranteed pay equity 6. The firm has provided incentives based on the results achieved Clan Culture 1. The organization is a very personal place. It is like an extended family. People seem to share a lot of themselves. 2. The leadership in the organization is generally considered to exemplify mentoring, facilitating, or nurturing. 3. The management style in the organization is characterized by teamwork, consensus, and participation. 4. The glue that holds the organization together is loyalty and mutual trust. Commitment to this organization runs high. 5. The organization emphasizes human development. High trust, openness, and participation persist. 6. The organization defines success on the basis of the development of human resources, teamwork, employee commitment, and concern for people. Hierarchical culture 1. The organization is a very controlled and structured place. Formal procedures generally govern what people do. 2. The leadership in the organization is generally considered to exemplify coordinating, organizing, or smooth-running efficiency. 3. The management style in the organization is characterized by security of employment, conformity, predictability, and stability in relationships. 4. The glue that holds the organization together is formal rules and policies. Maintaining a smoothly running organization is important. 5. The organization emphasizes permanence and stability. Efficiency, control, and smooth operations are important. 6. The organization defines success on the basis of efficiency. Dependable delivery, smooth scheduling, and low-cost production are critical. Adhocratic culture 1. The organization is a dynamic and entrepreneurial place. People are willing to stick their necks out and take risks. 2. The leadership in the organization is generally considered to exemplify entrepreneurship, innovation, or risk taking. 3. The management style in the organization is characterized by individual risk taking, innovation, freedom, and uniqueness. 4. The glue that holds the organization together is commitment to innovation and development. There is an emphasis on being on the cutting edge. 5. The organization emphasizes acquiring new resources and creating new challenges. Trying new things and prospecting for opportunities are valued. 6. The organization defines success on the basis of having unique or the newest products. It is a product leader and innovator. Market culture 1. The organization is very results oriented. A major concern is with getting the job done. People are very competitive and achievement oriented. 2. The leadership in the organization is generally considered to exemplify a no-nonsense, aggressive, results-oriented focus. 3. The...

The Significant Factors Influencing Individual’s Perceptions of Pay Gap

“…This system has a policy to give salary to the employees through the amount of performance they put in for the organization. Another article by Peláez-León et al (2023) advises that an organization needs to understand the cultural roots of the organization to exploit information and resources and decide whether this system is good for the organization. It should be emphasized that there are certain restrictions in this article.…”