Quarter past nine, I’m late again!

Topic: Compensation, Motivation, Rewards, Strategic HR
Publication: Research and Practice in Human Resource Management
Article: A Mathematical Model to Monitor Late Arrivals at Work.
Author: S.A. Oke, T.M. Ezenachkwu
Featured by: Sarah Bowen

In their recent article, Oke and Ezenachukwu embark on an ambitious journey to prove that timeliness is improved through rewards and recognition in the workplace.

The authors conduct their research in a beer and soft drink production company to test their model and assumptions.  Educational commitments, monotony of work, and poor welfare provisions were three key reasons workers gave as reasons for their tardiness.

The researchers proposed that work tardiness issues can be resolved through the use of rewards to employees who arrive early to work.  In order to alleviate lateness, the company implemented a computer system to supervise the arrival and departure times of workers and calculate the additional compensation for arriving early.  Adjusting for a variety of commuting differences, the results showed that most workers will arrive early to work when additionally compensated for their timeliness.

Maintaining proper records of employees’ daily arrival and departure times, informing employees about the program’s benefits, and giving feedback to employees and managers contributed to the effectiveness of this approach.  Electronic displays installed as part of this program served as reminders to employees about their responsibilities to the company and aided in motivating workers to achieve a better work culture.

In addition to directly affecting the bottom line, on-time arrival impacts the culture of the organization:  when workers arrive on time, a company acquires a more positive image and employees become more confident in management.

Oke, S. A. & Ezenachukwu, T. M. (2007). A Mathematical Model to Monitor Late Arrivals at Work by Junior Staff, Research and Practice in Human Resource 

Who is holding the glass ceiling in place?

Topic: Compensation, Organizational Justice, Motivation, Rewards
Publication: Journal of Human Resources
Article: Who is holding the glass ceiling in place? 
Author: N. Fortin
Featured by: Benjamin Granger

Many 21^st century women still earn less than their male counterparts.  However, this injustice may not be due fully to chauvinists and stereotypes.  In her article, The Gender Wage Gap among Young Adults in the United States: The Importance of Money versus People, Nicole Fortin investigates influences that women themselves exhibit which may contribute to their smaller paychecks.  As women more often choose to volunteer with organizations that are altruistic in nature, and tend to place more importance on workplace success rather than rolling in the dough, it is easy to follow Fortin’s argument that such noncognitive factors inevitably influence the gender wage gap. 

Using data from the National Longitudinal Study of the High School Class of 1972 and the National Educational Longitudinal Study of 1988/94, Fortin explores the possible impacts on the gender pay gap by examining four noncognitive functions:

·     The importance of money and work
·     The importance of people and family
·     Self-esteem
·     Locus of control (the extent to which a person feels they- rather than their environment        have control over their own success). 

In addition to human capital and cognitive factors, Fortin argues that these noncognitive qualities significantly influence the discrepancy in wages among men and women.  

Fortin finds that lower locus of control and higher importance of people and family tend to widen the gender wage gap, while higher self-esteem and importance of money and work tend to lead to more equitable wages for workers in their early thirties.  Although the research shows that the differences due to these noncognitive factors are largely insignificant over time, the importance of work and money should not be overlooked, as it plays the largest role of the four noncognitive factors.

Fortin, N. (2008, Fall2008). The Gender Wage Gap among Young Adults in the United States. Journal of Human Resources, 43(4), 884-918. Retrieved March 14, 2009, from Advanced Placement Source database.

Who Wouldn’t Take the Money and Run?

Topic: Compensation, Culture, Organizational Commitment
Article: When do committed employees retire?  The effects of organizational commitment on retirement plans under a defined benefit pension plan. 
Publication: Human Resource Management
Blogger: Benjamin Granger

Organizations commonly use defined-benefit pension plans in an effort to attract and retain good employees.  After all, turnover is expensive!  These plans usually allow employees to accrue retirement income security which should encourage employee retention.  However, the monetary values of such plans diminish greatly once employees pass the optimal age for retirement.  But do employees just care about the money?  (Yes, if they live in California and drive a Hummer. Yikes!).

Although many employees plan their retirement around the optimal point to maximize their retirement benefits, others stay with the organization and see the monetary value of their retirement benefits drop substantially.  So who are these crazy people?

Luchak, Pohler, and Gellatly (2008) investigated the role that organizational commitment plays when considering the age that employees plan to retire.  By definition, employees that are highly committed to their organization are less likely to quit.  But, are highly committed employees also willing to stay in the face of the depreciation of their pension plans?

The results of Luchak et al.’s study suggest that it depends on the type of commitment you consider.  That is, employees can be committed to their organizations for different reasons.  The authors studied two important commitment types: affective commitment and continuance commitment.  Employees high in affective commitment feel emotionally connected to the organizations while those high in continuance commitment stay with the organization because they will incur unfavorable losses if they leave.  Clearly, these commitments are very different.  Affectively committed employees want to stay because they connect with the organization, but employees high in continuance commitment stay because they basically have to.

Pay-for-performance: Helping those that help themselves?

Topic: Compensation, Motivation, Rewards
Publication: The Wall Street Journal
Article: When schools offer money as a motivator.
Blogger: James Grand

Long gone are the days when Mom and Dad would offer a few bucks for an “A” on your report card to buy some candy from the grocery store.  Now, the schools are starting to provide the incentives—and they aren’t just offering up bubble gum and lollipops.

A recent article from The Wall Street Journal (August 21, 2008) reported that a number of schools around the country are implementing new pay-for-performance (PFP) systems as means of encouraging high school students to enroll and pass Advanced Placement (AP) courses.  The performance rewards (in some cases, upwards of $1000) are given to the top performing students on the various AP exams.  With a great sigh of relief from its investors, longitudinal analyses of the PFP systems have shown mostly positive results—higher enrollment in AP classes, higher test scores and more graduating seniors moving on to college (whew).

But should schools (and other organizations, for that matter) be wary of the PFP reform?  Research from organizational psychology, management and education indicates that although PFP is generally linked to higher overall performance and satisfaction across a variety of domains, there are a number of consequences that should be carefully considered before they are used (Rynes, Gerhart, & Parks, 2005, provide an excellent review of the issues associated with PFP systems).  For example, there is evidence to suggest that PFP is more attractive to individuals’ with greater need for achievement and self-efficacy, which are often related to characteristics such as education level and even gender or race in many work domains.  Thus PFP systems have the potential to create discriminative compensation practices or entirely homogenous workforces if not carefully monitored.  Furthermore, in jobs/tasks where units of performance are not clearly established (i.e., subjective supervisor ratings, etc.), the benefits of PFP are often difficult to determine and may actually be detrimental.

Time will tell if PFP catches on in our nation’s schools—in the meantime, I suppose a bag of M&M’s never hurt anybody.

Singer-Vine, J. (2008, August 21). When schools offer money as a motivator. The Wall Street Journal. pp. D1.