engleski

Deriving meaning from group incentives: a critical approach

This paper presents new results about the incidence of group incentives in Croatian enterprises, as well as profile a typical enterprise that implements this type of transactional rewards. The primary research that was conducted as a part of this study includes cross-sectional sample of nationally representative large and medium-sized companies. These companies are expected to have more sophisticated HRM practices in general, and reward practices in specific. Preliminary results revealed that profit-sharing is the most frequently used group cash reward while other group rewards do not seem to be as prevalent as profit-sharing (observed in less than 10% of cases). Existing empirical evidence indicates that smaller firms derive larger benefits from pay linked to group performance (Zenger & Marshall, 1995), most likely due to the fact that employees have increased influence over performance outcomes and pay. This study will include exploration of mechanisms behind group incentives and performance of medium and large sized firms. What are the conditions under which group compensation plans contribute to one’s work and consequentially performance? How do such extrinsic incentives support create meanings from work? We aim at testing the motivation potential of group incentives as well as critically exploring their role in achieving organization-wide outcomes such as improving productivity, financial performance and reducing absenteeism. This study contributes to the existing knowledge on group incentives since it is based on exploration of unique work context in Croatia, post-transition economy whose reward practices are lagging behind practices used in developed economies.

reward management practices, group incentives, group variable pay, profit-sharing, ESOP

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