Congruence between technology and compensation systems: implications for strategy implementation

This paper examines the interactive relationship between the use of integrated manufacturing and compensation practices in predicting several aspects of plant performance in the concrete pipe industry. We predicted that compensation practices reinforcing collective effort, teamwork, and flexibility...

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Bibliographic Details
Published in:Strategic management journal 2001-04, Vol.22 (4), p.379-386
Main Authors: Shaw, Jason D., Gupta, Nina, Delery, John E.
Format: Article
Language:English
Subjects:
Advanced manufacturing technologies
Applied sciences
Compensation
Compensation plans
Concrete
Cooperation
Corporate strategies
Customer satisfaction
Effectiveness
Employee motivation
Employees
Exact sciences and technology
Firm modelling
Flexibility
Hypotheses
Incentive pay
Incentive plans
Integrated approach
Job performance
Management
Manufacturing
Manufacturing processes
Operational research and scientific management
Operational research. Management science
Quality management
Research Notes and Commentaries
Response rates
Seniority
Skills
Strategy implementation
Studies
Teamwork
Technology
Total quality
Total quality management
Wages & salaries
Work incentives
Workforce
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Summary:This paper examines the interactive relationship between the use of integrated manufacturing and compensation practices in predicting several aspects of plant performance in the concrete pipe industry. We predicted that compensation practices reinforcing collective effort, teamwork, and flexibility (team incentives and skill-based pay) enhance the effectiveness of integrated manufacturing systems (total quality management and advanced manufacturing technology), while practices inhibiting cooperation and teamwork among employees (individual incentives and seniority-based pay) impede it. Results provide moderate support for the congruence model across several measures of plant effectiveness (labor hours per ton, lost-time accidents, perceptual performance, and customer satisfaction). Implications of the research are addressed.
ISSN:0143-2095
1097-0266
DOI:10.1002/smj.165