Effects of a Tournament Incentive Plan Incorporating Managerial Discretion in a Geographically Dispersed Organization

• 成果类型: Article
• 署名作者: Dellar, Carolyn; Sandino, Tatiana
• 署名单位: University of Pennsylvania; Harvard University
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2018.3214
• 发表日期: 2020
• 页码: 911-931
• 关键词: tournaments; SUBJECTIVITY; DISCRETION; fairness; GEOGRAPHIC DISTANCE; company values; Retail chains

摘要

Using retail chain data, we study the effects of a tournament incentive plan based primarily on objective performance, but incorporating managerial discretion in the selection of winners. In principle, such plans could motivate employees to perform both at a high level, based on objective criteria, and in accordance with company values, considered via managerial discretion. However, such plans could be counterproductive if enough participants (especially those who do not win) perceive that subjectivity (introduced via discretion) adds unfairness. We show that, on average, the tournament incentive plan was associated with improved store sales. We also find that such plans can be more beneficial for geographically distant participants, where the potential for improving alignment is greater. Lastly, we find some evidence that participants' resource constraints (potentially affecting unfairness concerns) can impact outcomes under the plan.