Managers are suffered from the high turnover rate in sales management. According to relative research results, pay systems have the most powerful impact on organizational performance among all the HR practices. Well-designed pay systems could attract and retain talent employees. They are also coupled with the effectiveness of performance evaluation, which stands for the aim of ensuring attaining organizational goals. Therefore, success or failure of an organization is significantly related to its pay system design. Because of its flexibility and responsiveness to organizational goals, variable pay possesses the ability to grant rewards linking employees to organizational success. From personnel economics perspective, monetary incentives have effects on output. However, a lack of data makes the above statement not corroborated. Based on a 60-month period data from a retailing company, this research conducts longitudinal analysis by fixed-effects regression model to empirically test the effects of variable pay on employees¡¦ job performance. Results verify the effects of variable pay on productivity. Those who are with individual level of performance measure, reasonable goal-setting and equitable payout formula characteristics show the best effect on productivity. Implications for designing variable pay systems are discussed and future research suggestions are provided.

Abstract A well designed salary system can influence employee¡¦s work motivation and will reflect on their work performance. It would not be difficult to understand, based on the theory of expectancy, a linkage between reward and performance will motivate employee to work harder, and from which to create good performance and in turn to receive better rewards. That is to say a business which adopts an incentive reward system to motivate employee will receive better performance from them in a consistent manner and the end result is to improve the performance of the organization. In the past, there have been many researches on influence of salary system on pay satisfaction and working attitude of employee, but few has studied differences in individual risk preference which can interfere with pay satisfaction and to explore differences in risk preference of employee, the effect of variable pay on pay satisfaction and working attitudes. Through empirical analyses, it was found that: 1. In an organization, an implementation of variable pay system will affect pay satisfaction. As salary links more closely with performance, employee¡¦s pay satisfaction increases. 2. The impact of variable pay on pay satisfaction is not influenced by individual risk preference. Due to differences in salary system to motivate employee, in the business this study concludes if employee is unaware of risk or incentive that is structured in the salary system, then there will be not interaction between difference in risk preference and variable pay system, and will also have no impact on salary satisfaction. 3. Pay satisfaction will have an effect on work attitude of employee. The higher the pay satisfaction, the stronger the organization commitment and job involvement by the employee. 4. Through pay satisfaction, variable pay will indirectly affect employee¡¦s work attitude. A reflection on organizational commitment and job involvement due to salary variable as a result of performance change in part must pass through the intermediate effect of pay satisfaction. Keywords: variable pay, risk preferences, pay satisfaction, organizational commitment, job involvement

This paper examines the relationship between executive compensation – in the form ofvariable pay – and earnings management. Since most research is done on Americancompanies, and Swedish companies are adopting a more Anglo-American compensationstructure, we would like to study this in Sweden. We hypothesize that CEOs with highervariable pay are more likely to engage in earnings management. This study is done onSwedish companies listed on Large- and Mid-Cap. Using data from the companies’ annualreports we find no significant relationship between variable pay and discretionary accrualsusing our regression. / Denna studie undersöker relationen mellan kompensation till ledande befattningshavare –den del av lönen som är rörlig - och manipulering av intäkter. Då större delen av tidigareforskning har fokuserat på amerikanska företag, och svenska företag anammar en mer angloamerikanskstruktur av kompensation, vill vi undersöka detta i Sverige. Vi kommer fram tillen hypotes där vi antar att en VD med högre rörlig lön är mer trolig att manipulera intäkter.Studien är gjord på svenska företag listade på Large och Mid Cap. Genom att använda datafrån företagens årsredovisningar och Datastream hittar vi genom våra regressioner ingasamband mellan rörlig lön och diskretionära periodiseringar.

A força de vendas ocupa papel importante no desempenho das organizações, e em especial naquelas do mercado industrial. As decisões que envolvem a gestão da força de vendas, principalmente as referentes à remuneração, revestem-se de importância, dado seu potencial impacto no desempenho desses profissionais. Esta dissertação, embasada na teoria da contingência, pressupõe que não há um sistema de remuneração ?ótimo ou ideal? e, sim, aquele que melhor se ajusta ao contexto e objetivos organizacionais. Deste modo, a efetividade da estratégia de remuneração depende da existência de ajuste a certos fatores contingenciais aos quais a organização está sujeita com potencial de afetar o sistema. O construto de estratégia de remuneração foi operacionalizado através do repertório de escolhas a disposição dos gestores que têm impacto no desempenho da organização e no uso efetivo de seus recursos humanos. Especificamente quanto à estratégia de remuneração de vendas, a composição da remuneração é uma das escolhas relevantes, por se tratar de escolha na qual reside grande variabilidade entre as empresas, eventualmente de mesmo setor, o que sugere ser fortemente influenciada por fatores contingenciais. Esta dissertação objetiva então, expandir o conhecimento acerca do sistema de remuneração da força de vendas, suas especificidades, escolhas estratégicas envolvidas e fatores contingenciais. Para responder ao problema de pesquisa, optou-se pela realização de estudo exploratório e pelo método qualitativo, mais especificamente pelo estudo de caso, para ampliar o conhecimento sobre o fenômeno estudado, com uso de entrevistas em profundidade semi-estruturadas para levantamento das informações. Sumariamente, as contingências culturais e relacionadas ao macro-ambiente e ao ambiente de negócios se mostraram relevantes nas escolhas corporativas de remuneração nos casos estudados, corroborando os pressupostos teóricos da teoria da contingência e da nova economia institucional. De outro lado, as contingências que afetam as decisões relativas à composição de remuneração são de todos os planos ? do macro-ambiente, do ambiente de negócios, do processo de vendas, papel e, provavelmente, do indivíduo. Alguns fatores se destacaram nas organizações pesquisadas: o grau de incerteza do mercado e do ambiente; a competitividade e estabilidade do mercado; à estratégia competitiva; o ciclo de vida da organização e a cultura organizacional; características do ciclo de vendas, autonomia e supervisão recebida. Pode-se concluir que as decisões relativas à composição devem partir de análise cuidadosa dos ambientes externo e interno, procurando-se observar o seu impacto na reconfiguração do papel da força de vendas. Os resultados apontam para possíveis pontos de atenção na tomada de decisão acerca de sistemas de remuneração de profissionais de vendas, tendo em vista a sua efetividade. / Sales force management presents an important strategic decision to many firms. It has been widely acknowledged that the compensation of the sales force may be used to enhance sales, control sales force activities and improve customer relationships.Despite the ackowledged importance of sales compensation, the literature on the topic is rather limited and esparse. Based on contingency theory, it is proposed that the effectiveness of the type of compensation cannot be adequately assessed without consideration of these factors. It is hypothesized that the effectiveness at realizing intended pay strategies depends significantly on the existence of a match between compensation strategies, organization and the environment. To date, vey little work has been done in development a contngency theory that ties the pay system to the organization`s operating objetives and strategies. This study seeks to expand the emerging compensation strategy literature and examines the various dimensions that may be used to study this construct. Compensation strategy is the repertoire of pay choices available to management, that may, under some conditions, have an impact on the organization`s performance and the effective use of its human resources. Pay mix (the split between fix and variable pay) was assumed to be the most important pay choice for the sales force. Besides that, pay mix is one of the pay strategies that presents great variability between the companies, even from the same economic sector, suggesting that it is influencied by contingency factors. Thus, this study adresses the following key research question: What are the contingency factors that moderate the pay choices (pay strategy)? The contingency fators were studied beyond two major categories: external environment and internal environment. To answer the proposed question, an empirical study was conducted. The study was employed was a case study methodology. Primary data was obtained by in deep interviews .The study offer empirical support for the contingency theory. In particular, macrolevel factors like uncertainly and risk, as well as organizational factors ? corporate culture seemed to be relevant for the corporate pay strategies. On the other hand, ?pay mix? was the pay choice that seems to be influencied by multi-level factors. Some factors appeared to have more influence in the pay mix choices in the searched organizations: the degree of uncertainty of the market and the environment; the competitiveness and stability of the market; the competitive strategy; the organization life cicle and culture; characteristics of the sales cycle autonomy and received supervision. It can be concluded that strategic decision on pay mix must take careful analysis on contingency factors related to external and internal environments, because they tend to shape the sales process and the sales force role. The findings suggests some possible points of attention in the decision concerning to compensation of sales force towards effectiveness and could help practitioners manage the relationship between reward processes and strategy in organization.

Previous empirical research on variable pay systems have suggested that possible gains can come from paying for performance, but highlight the difficulty firms face in measuring performance. Using contracts signed in Major League Baseball’s free agent market, I find that over the 2010-2014 period, teams utilized variable pay schemes with players that were more productive or signaled greater risk, either in their contract terms or via overspecialization. However, not all forms of risk signaling were correlated with greater use of performance incentives, including age and proxies for injury history. These findings have significant implications for labor practices more broadly, as the high-information environment of Major League Baseball can shed light on how principals behave when performance measurement costs are effectively eliminated.

A força de vendas ocupa papel importante no desempenho das organizações, e em especial naquelas do mercado industrial. As decisões que envolvem a gestão da força de vendas, principalmente as referentes à remuneração, revestem-se de importância, dado seu potencial impacto no desempenho desses profissionais. Esta dissertação, embasada na teoria da contingência, pressupõe que não há um sistema de remuneração ?ótimo ou ideal? e, sim, aquele que melhor se ajusta ao contexto e objetivos organizacionais. Deste modo, a efetividade da estratégia de remuneração depende da existência de ajuste a certos fatores contingenciais aos quais a organização está sujeita com potencial de afetar o sistema. O construto de estratégia de remuneração foi operacionalizado através do repertório de escolhas a disposição dos gestores que têm impacto no desempenho da organização e no uso efetivo de seus recursos humanos. Especificamente quanto à estratégia de remuneração de vendas, a composição da remuneração é uma das escolhas relevantes, por se tratar de escolha na qual reside grande variabilidade entre as empresas, eventualmente de mesmo setor, o que sugere ser fortemente influenciada por fatores contingenciais. Esta dissertação objetiva então, expandir o conhecimento acerca do sistema de remuneração da força de vendas, suas especificidades, escolhas estratégicas envolvidas e fatores contingenciais. Para responder ao problema de pesquisa, optou-se pela realização de estudo exploratório e pelo método qualitativo, mais especificamente pelo estudo de caso, para ampliar o conhecimento sobre o fenômeno estudado, com uso de entrevistas em profundidade semi-estruturadas para levantamento das informações. Sumariamente, as contingências culturais e relacionadas ao macro-ambiente e ao ambiente de negócios se mostraram relevantes nas escolhas corporativas de remuneração nos casos estudados, corroborando os pressupostos teóricos da teoria da contingência e da nova economia institucional. De outro lado, as contingências que afetam as decisões relativas à composição de remuneração são de todos os planos ? do macro-ambiente, do ambiente de negócios, do processo de vendas, papel e, provavelmente, do indivíduo. Alguns fatores se destacaram nas organizações pesquisadas: o grau de incerteza do mercado e do ambiente; a competitividade e estabilidade do mercado; à estratégia competitiva; o ciclo de vida da organização e a cultura organizacional; características do ciclo de vendas, autonomia e supervisão recebida. Pode-se concluir que as decisões relativas à composição devem partir de análise cuidadosa dos ambientes externo e interno, procurando-se observar o seu impacto na reconfiguração do papel da força de vendas. Os resultados apontam para possíveis pontos de atenção na tomada de decisão acerca de sistemas de remuneração de profissionais de vendas, tendo em vista a sua efetividade. / Sales force management presents an important strategic decision to many firms. It has been widely acknowledged that the compensation of the sales force may be used to enhance sales, control sales force activities and improve customer relationships.Despite the ackowledged importance of sales compensation, the literature on the topic is rather limited and esparse. Based on contingency theory, it is proposed that the effectiveness of the type of compensation cannot be adequately assessed without consideration of these factors. It is hypothesized that the effectiveness at realizing intended pay strategies depends significantly on the existence of a match between compensation strategies, organization and the environment. To date, vey little work has been done in development a contngency theory that ties the pay system to the organization`s operating objetives and strategies. This study seeks to expand the emerging compensation strategy literature and examines the various dimensions that may be used to study this construct. Compensation strategy is the repertoire of pay choices available to management, that may, under some conditions, have an impact on the organization`s performance and the effective use of its human resources. Pay mix (the split between fix and variable pay) was assumed to be the most important pay choice for the sales force. Besides that, pay mix is one of the pay strategies that presents great variability between the companies, even from the same economic sector, suggesting that it is influencied by contingency factors. Thus, this study adresses the following key research question: What are the contingency factors that moderate the pay choices (pay strategy)? The contingency fators were studied beyond two major categories: external environment and internal environment. To answer the proposed question, an empirical study was conducted. The study was employed was a case study methodology. Primary data was obtained by in deep interviews .The study offer empirical support for the contingency theory. In particular, macrolevel factors like uncertainly and risk, as well as organizational factors ? corporate culture seemed to be relevant for the corporate pay strategies. On the other hand, ?pay mix? was the pay choice that seems to be influencied by multi-level factors. Some factors appeared to have more influence in the pay mix choices in the searched organizations: the degree of uncertainty of the market and the environment; the competitiveness and stability of the market; the competitive strategy; the organization life cicle and culture; characteristics of the sales cycle autonomy and received supervision. It can be concluded that strategic decision on pay mix must take careful analysis on contingency factors related to external and internal environments, because they tend to shape the sales process and the sales force role. The findings suggests some possible points of attention in the decision concerning to compensation of sales force towards effectiveness and could help practitioners manage the relationship between reward processes and strategy in organization.

Ce mémoire a pour objectif de comprendre l’impact de la satisfaction envers les régimes de rémunération variable sur l’engagement organisationnel des travailleurs. Pour étudier cette question, nous avons utilisé trois hypothèses basées sur la théorie des attentes ainsi que sur la théorie de l’agence. La première hypothèse stipule que la satisfaction envers les régimes de bonis fait augmenter le niveau d’engagement organisationnel des travailleurs. La deuxième hypothèse est que la satisfaction envers les régimes de partage des bénéfices fait augmenter le niveau d’engagement organisationnel des travailleurs. La troisième hypothèse stipule que la satisfaction envers les régimes d’actionnariat fait augmenter le niveau d’engagement organisationnel des travailleurs. Nous avons utilisé une base de données provenant d’une enquête plus large portant sur « les liens entre la rémunération, la formation et le développement des compétences et l’attraction et la rétention d’employés clés ». L’entreprise où les données ont été collectées œuvre dans le secteur des technologies de l’information et des communications (TIC). Les nouveaux employés embauchés dans cette entreprise établie à Montréal ont été interrogés. Nos résultats nous permettent de confirmer deux de nos hypothèses, soit celle qui concerne les régimes de bonis et celle qui concerne les régimes d’actionnariat. Nos résultats indiquent que les individus satisfaits à l’égard des régimes de rémunération variable, plus précisément envers les régimes de bonis et les régimes d’actionnariat, présentent de plus hauts niveaux d’engagement organisationnel. Le soutien organisationnel perçu est également un facteur important dans le développement de l’engagement organisationnel. Finalement, nous concluons ce mémoire avec l’implication de nos résultats pour les différents acteurs en relations industrielles. / The objective of this study is to understand the impact of the satisfaction with variable pay plans on organizational commitment of workers. To investigate this question, we used three hypotheses based on the theory of expectations and on the agency theory. The first hypothesis states that satisfaction with bonus plans increases the level of affective organizational commitment of workers. The second hypothesis is that satisfaction with profit-sharing plans increases the level of affective organizational commitment of workers. The third hypothesis states that satisfaction with stock ownership plans increases the level of affective organizational commitment of workers. We used a database from a wider survey on "the links between compensation, training and skills development and attracting and retaining key employees." The company where the data was collected is in the field of information technology and communications. New employees hired in this company based in Montreal were interviewed. Our results allow us to confirm two of our hypotheses. Our results indicate that individuals satisfied with variable pay plans, more precisely towards the bonus plans and stock ownership plans, have higher levels of organizational commitment. Perceived organizational support is also an important factor in the development of organizational commitment. Finally, this study concludes with the implication of our results for the different actors in industrial relations.

Ce mémoire a pour objectif de comprendre l’impact de la satisfaction envers les régimes de rémunération variable sur l’engagement organisationnel des travailleurs. Pour étudier cette question, nous avons utilisé trois hypothèses basées sur la théorie des attentes ainsi que sur la théorie de l’agence. La première hypothèse stipule que la satisfaction envers les régimes de bonis fait augmenter le niveau d’engagement organisationnel des travailleurs. La deuxième hypothèse est que la satisfaction envers les régimes de partage des bénéfices fait augmenter le niveau d’engagement organisationnel des travailleurs. La troisième hypothèse stipule que la satisfaction envers les régimes d’actionnariat fait augmenter le niveau d’engagement organisationnel des travailleurs. Nous avons utilisé une base de données provenant d’une enquête plus large portant sur « les liens entre la rémunération, la formation et le développement des compétences et l’attraction et la rétention d’employés clés ». L’entreprise où les données ont été collectées œuvre dans le secteur des technologies de l’information et des communications (TIC). Les nouveaux employés embauchés dans cette entreprise établie à Montréal ont été interrogés. Nos résultats nous permettent de confirmer deux de nos hypothèses, soit celle qui concerne les régimes de bonis et celle qui concerne les régimes d’actionnariat. Nos résultats indiquent que les individus satisfaits à l’égard des régimes de rémunération variable, plus précisément envers les régimes de bonis et les régimes d’actionnariat, présentent de plus hauts niveaux d’engagement organisationnel. Le soutien organisationnel perçu est également un facteur important dans le développement de l’engagement organisationnel. Finalement, nous concluons ce mémoire avec l’implication de nos résultats pour les différents acteurs en relations industrielles. / The objective of this study is to understand the impact of the satisfaction with variable pay plans on organizational commitment of workers. To investigate this question, we used three hypotheses based on the theory of expectations and on the agency theory. The first hypothesis states that satisfaction with bonus plans increases the level of affective organizational commitment of workers. The second hypothesis is that satisfaction with profit-sharing plans increases the level of affective organizational commitment of workers. The third hypothesis states that satisfaction with stock ownership plans increases the level of affective organizational commitment of workers. We used a database from a wider survey on "the links between compensation, training and skills development and attracting and retaining key employees." The company where the data was collected is in the field of information technology and communications. New employees hired in this company based in Montreal were interviewed. Our results allow us to confirm two of our hypotheses. Our results indicate that individuals satisfied with variable pay plans, more precisely towards the bonus plans and stock ownership plans, have higher levels of organizational commitment. Perceived organizational support is also an important factor in the development of organizational commitment. Finally, this study concludes with the implication of our results for the different actors in industrial relations.

<p>Det är en ständigt pågående debatt om huruvida belöningssystem fungerar som motivationsinstrument eller inte. Många, främst inom den psykologiska skolan, är kritiska till belöningssystem, trots detta finns de i alla organisationer. Kan denna förekomst förklaras av att det finns en annan skola, den ekonomiska, som är det dominerande synsättet hos företag? Syftet med denna uppsats är att ställa den psykologiska skolans motivationsuppfattning emot den ekonomiska i en analys, och utifrån denna se om det går att dra slutsatsen att det ekonomiska tankesättet är det som dominerar och därmed ge en förklaring till varför belöningssystem förekommer som motivationsverktyg i ett företag. För att kunna utreda detta har vi valt att göra en fallstudie på företaget Tempur och dess säljare, samt tagit hjälp av teorier ur såväl den psykologiska motivationsuppfattningen, Maslow och Herzberg, som den ekonomiska, economic man. Utifrån detta har vi dels dragit slutsatsen att den ekonomiska teorin dominerar såväl Tempurs antaganden om individen som säljarnas beteenden, dels att belöningar i form av pengar är den mest betydande faktorn för säljarnas motivation.</p>

Det är en ständigt pågående debatt om huruvida belöningssystem fungerar som motivationsinstrument eller inte. Många, främst inom den psykologiska skolan, är kritiska till belöningssystem, trots detta finns de i alla organisationer. Kan denna förekomst förklaras av att det finns en annan skola, den ekonomiska, som är det dominerande synsättet hos företag? Syftet med denna uppsats är att ställa den psykologiska skolans motivationsuppfattning emot den ekonomiska i en analys, och utifrån denna se om det går att dra slutsatsen att det ekonomiska tankesättet är det som dominerar och därmed ge en förklaring till varför belöningssystem förekommer som motivationsverktyg i ett företag. För att kunna utreda detta har vi valt att göra en fallstudie på företaget Tempur och dess säljare, samt tagit hjälp av teorier ur såväl den psykologiska motivationsuppfattningen, Maslow och Herzberg, som den ekonomiska, economic man. Utifrån detta har vi dels dragit slutsatsen att den ekonomiska teorin dominerar såväl Tempurs antaganden om individen som säljarnas beteenden, dels att belöningar i form av pengar är den mest betydande faktorn för säljarnas motivation.