Some degree of conflict within groups is often unavoidable, and can in fact have positive outcomes, but it can also lead to debilitating effects on group performance. A US study examined the effects of conflict on the effort levels of individuals and how incentives can overcome the negative effects of conflict. The researchers looked specifically at faultline conflict, which is conflict induced from dividing lines between group members. Results found that team members reduce their effort when they perceive faultline related conflict, while incentives moderated this effect of conflict on effort. Under these circumstances, team incentives were found to have a greater effect on performance than individual incentives.
Key Topics: Conflict; Incentives; Group decision making; Effort; Faultlines
The ability of companies to be adaptable and pursue different paths simultaneously, to have organizational ambidexterity, is central to the success of many companies. A recent study on the banking sector in Israel examined the role of performance bonuses in facilitating organizational ambidexterity, and found bonuses to have a significant influence on employee performance, although the study also found that high ability employees were more capable of adjusting performance to benefit most from bonus plans.
Key Topics: Organizational ambidexterity; Employee Ability; Performance; Bonuses
With companies constantly seeking ways to gain competitive advantage, many employ the use of pay for performance i.e. those employees whose performance is better get more, but if such practices are managed poorly could they impede the effort of higher ability employees? A study at the University of California examined the effect of compensation distribution on the performance of higher-ability employees and found that such employees reduced their effort when not paid more than low ability colleagues, under pay for performance conditions. The findings also indicated that when managers are unclear on the ability of employees then compensation compression between high and low ability employees is more likely.
Key Topics: Compensation inequality; Compensation compression; Employee effort; Pay for performance |
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