A Multilevel Analysis of the Use of Individual Pay-for-Performance Systems

Abstract

Compensation systems, such as individualized pay-for-performance (I-PFP

‘Fit’ for telework’? Cross-cultural variance and task-control explanations in organizations’ formal telework practices

“…For example, our findings may suggest that for organizations in nations with strong (individualism or collectivism) values, introducing an HRM strategy including a high level of telework practices may be a 'smart' way to gain competitive advantage in global markets. However, intra-organizational control mechanisms need to be exercised with caution, as ex post formal controls, including 360º evaluations and pay-for-performance systems, may be less compatible with collectivist cultures (Gooderham, Fenton-O'Creevy, Croucher, & Brookes, 2015). Of course, it is even conceivable that future telework practices might push a national culture in a more individualistic direction, with damaging long-term consequences (Putnam, 2000).…”

Context and HRM: Theory, Evidence, and Proposals

“…Thus, their findings support the notion that institutional determinants, as indicated by the national embeddedness of firms, have a substantial effect on the application of compensation practices. In a substantial refinement of this analysis, Gooderham et al (2018) conducted a multi-level analysis of the adoption of I-PFP using data from over 4,000 firms in 26 countries. Using Botero et al's (2004) labor regulation approach to conducting crossnational institutional comparisons, as well as a measure of national culture, they find that, at the country level, both culture and the institutional environment explain significant variance in the use of I-PFP.…”

Context, market economies and MNEs: The example of financial incentivization

“…What comparative literature there is has focused on macro-economic trends or selective case study evidence (Thompson & Vincent, 2010;Wood, Brewster & Brookes, 2014) with a nascent stream of work using survey evidence that has focused on, and encountered, variations in rewards between states, with some studies also looking at the cases of Eastern Europe and the Mediterranean world (Croucher et al, 2012, Brewster et al, 2013Pendleton et al, 2003;Poutsma & De Nijs, 2003). A recent paper by Gooderham et al (2015) deploys multi-level analysis to explore variations in reward systems, using the same Cranet dataset as this paper.…”

“…They find that institutional and cultural effects directly impact on the relative utilization of pay for performance systems, with such systems being most prevalent in the USA (Gooderham et al, 2015).…”