National culture moderators of pay for individual performance and the financial performance of multinational enterprises
We examined the effectiveness of pay for individual performance (PFIP) in companies operating in multiple cultures. With the use of data from 308 multinational enterprises (MNEs) collected by IBM's WorkTrends™ project, we tested hypotheses regarding the moderating influence of the nine dimensio...
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| Vydané v: | Applied psychology Ročník 72; číslo 2; s. 477 - 505 |
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| Hlavní autori: | , , , |
| Médium: | Journal Article |
| Jazyk: | English |
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Oxford
Blackwell Publishing Ltd
01.04.2023
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| ISSN: | 0269-994X, 1464-0597 |
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| Abstract | We examined the effectiveness of pay for individual performance (PFIP) in companies operating in multiple cultures. With the use of data from 308 multinational enterprises (MNEs) collected by IBM's WorkTrends™ project, we tested hypotheses regarding the moderating influence of the nine dimensions of the GLOBE country culture model on the relationship between PFIP and changes in financial performance over time. Multiple employees per firm (mean N = 24.7 employees) reported the extent there was a PFIP climate (PFIPc) in their firm. We matched these data at the firm level to changes in net income per employee over 4 years from the Wharton Research Data Service (WRDS). Consistent with predictions developed from contingency and cross‐cultural theories, after including relevant controls, we found the positive relationship between PFIPc and subsequent MNE performance is greater in cultures higher in future orientation, institutional collectivism and uncertainty avoidance and also lower in in‐group collectivism, power distance and humane orientation. |
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| AbstractList | We examined the effectiveness of pay for individual performance (PFIP) in companies operating in multiple cultures. With the use of data from 308 multinational enterprises (MNEs) collected by IBM's WorkTrends™ project, we tested hypotheses regarding the moderating influence of the nine dimensions of the GLOBE country culture model on the relationship between PFIP and changes in financial performance over time. Multiple employees per firm (mean N = 24.7 employees) reported the extent there was a PFIP climate (PFIPc) in their firm. We matched these data at the firm level to changes in net income per employee over 4 years from the Wharton Research Data Service (WRDS). Consistent with predictions developed from contingency and cross‐cultural theories, after including relevant controls, we found the positive relationship between PFIPc and subsequent MNE performance is greater in cultures higher in future orientation, institutional collectivism and uncertainty avoidance and also lower in in‐group collectivism, power distance and humane orientation. We examined the effectiveness of pay for individual performance (PFIP) in companies operating in multiple cultures. With the use of data from 308 multinational enterprises (MNEs) collected by IBM's WorkTrends™ project, we tested hypotheses regarding the moderating influence of the nine dimensions of the GLOBE country culture model on the relationship between PFIP and changes in financial performance over time. Multiple employees per firm (mean N = 24.7 employees) reported the extent there was a PFIP climate (PFIPc) in their firm. We matched these data at the firm level to changes in net income per employee over 4 years from the Wharton Research Data Service (WRDS). Consistent with predictions developed from contingency and cross‐cultural theories, after including relevant controls, we found the positive relationship between PFIPc and subsequent MNE performance is greater in cultures higher in future orientation, institutional collectivism and uncertainty avoidance and also lower in in‐group collectivism, power distance and humane orientation. |
| Author | Campion, Michael A. Posthuma, Richard A. Campion, Emily D. Zhang, Haiyan |
| Author_xml | – sequence: 1 givenname: Richard A. surname: Posthuma fullname: Posthuma, Richard A. organization: University of Texas at El Paso – sequence: 2 givenname: Emily D. surname: Campion fullname: Campion, Emily D. organization: Old Dominion University – sequence: 3 givenname: Michael A. surname: Campion fullname: Campion, Michael A. email: campionm@purdue.edu organization: Purdue University – sequence: 4 givenname: Haiyan surname: Zhang fullname: Zhang, Haiyan organization: Smarter Workforce Institute IBM Talent Management Solutions |
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| SubjectTerms | Collectivism contingency theory country culture Cultural change cultural congruence Cultural factors Culture Data Employees Financial performance firm financial performance Future Moderators Multinational corporations Organizational effectiveness pay for individual performance climate Uncertainty |
| Title | National culture moderators of pay for individual performance and the financial performance of multinational enterprises |
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