TY - JOUR
T1 - Group-based pay-for-performance plans and firm performance
T2 - The moderating role of empowerment practices
AU - Kim, Hyondong
AU - Sutton, Kyra L.
AU - Gong, Yaping
PY - 2013/3
Y1 - 2013/3
N2 - As the popularity of group-based pay-for-performance plans persists, compensation researchers are exploring the conditions under which these plans contribute to the financial performance of firms. Based on a sample of 1,933 employees from 415 companies in South Korea, we found that group-based pay-for-performance plans enhance both objective and subjective measures of firm performance. Furthermore, consistent with the contingency perspective of fit, we found that empowerment practices positively moderate the relationship between group-based pay-for-performance plans and firm performance. These findings suggest that empowerment can enhance the effectiveness of such pay plans. We discuss implications for research and practice.
AB - As the popularity of group-based pay-for-performance plans persists, compensation researchers are exploring the conditions under which these plans contribute to the financial performance of firms. Based on a sample of 1,933 employees from 415 companies in South Korea, we found that group-based pay-for-performance plans enhance both objective and subjective measures of firm performance. Furthermore, consistent with the contingency perspective of fit, we found that empowerment practices positively moderate the relationship between group-based pay-for-performance plans and firm performance. These findings suggest that empowerment can enhance the effectiveness of such pay plans. We discuss implications for research and practice.
KW - Contingency perspective
KW - Empowerment practice
KW - Group-based pay-for-performance plan
KW - South Korea
UR - http://www.scopus.com/inward/record.url?scp=84873745601&partnerID=8YFLogxK
U2 - 10.1007/s10490-011-9255-7
DO - 10.1007/s10490-011-9255-7
M3 - Article
AN - SCOPUS:84873745601
SN - 0217-4561
VL - 30
SP - 31
EP - 52
JO - Asia Pacific Journal of Management
JF - Asia Pacific Journal of Management
IS - 1
ER -