Budget-Based Contracts, Budget Levels, and Group Performance

2003 ◽  
Vol 15 (1) ◽  
pp. 51-74 ◽  
Author(s):  
Joseph G. Fisher ◽  
Sean A. Peffer ◽  
Geoffrey B. Sprinkle

In this paper, we experimentally investigate the effects of budget-based contracts and budget levels (performance targets) on group performance. We compare a group piece-rate contract with two different specifications of a group budget-based contract: (1) a group budget-fixed contract that provides no remuneration for performance below the budget and a fixed bonus for performance meeting or exceeding the budget, and (2) a group budget-linear contract that provides no remuneration for performance below the budget, a fixed bonus once the budget is attained, plus a piece-rate for production in excess of the budget. We also assigned each group a budget level, set at 50 percent, 75 percent, or 100 percent of the group's performance capability. The results indicate that the group budget-linear contract led to significantly higher group performance than both the group budget-fixed contract and the group piece-rate contract. Additionally, the 75 percent budget level led to significantly higher group performance than both the 50 percent budget level and the 100 percent budget level. Finally, the variability in group performance was lowest under the group budget-linear contract and the 75 percent budget level. Collectively, these results demonstrate the efficacy of both certain types of budget-based contracts and “moderately” difficult budget goals in enhancing group performance. The results also suggest that both motivation and coordination (planning) can be enhanced by budget levels of moderate difficulty and group budget-linear contracts, as the group budget-linear contract and the 75 percent budget level not only led to the highest level of performance, but also led to the lowest variability in performance.

2009 ◽  
Vol 21 (1) ◽  
pp. 293-316 ◽  
Author(s):  
David R. Upton

ABSTRACT: In this paper I examine the effects of social value orientation (SVO) and group incentive contracts on performance and performance variance. SVO includes three main personality types: prosocials (who value cooperation and equality in outcomes); individualists (who focus upon their own rewards); and, competitors (who seek relative advantage over others, even at their own expense). In an experiment I form groups of participants based on their SVO and assign them to one of three incentive contracts: a piece-rate contract that pays all employees an equal share of any group output, and two budget-linear contracts (with a medium and a high budget target) that pay zero compensation below the budget target, an equal share of a bonus if the budget target is met and a piece-rate for output above the budget target. Group performance is highest for groups of prosocials and lowest for groups with competitors and SVO has a greater effect under a medium rather than a high budget over latter periods of the experiment. Further, SVO appears to play a role in influencing performance variance. These results illustrate the potential of considering individual difference measures such as SVO in conjunction with formal control systems such as budgets to enhance motivation and coordination within organizations.


2015 ◽  
Vol 2015 ◽  
pp. 1-11 ◽  
Author(s):  
Jeppe Zielinski Nguyen Ajslev ◽  
Roger Persson ◽  
Lars Louis Andersen

Piece rate and performance based wage systems are common in the construction industry. Construction workers are known to have an increased risk of pain and musculoskeletal disorders (MSD). In this cross-sectional questionnaire study, we examined the association between wage system and (1) physical exertion, (2) time pressure, (3) pain, and (4) fatigue. The participants comprised 456 male Danish construction workers working on one of three different wage systems: group based performance wage, individually based performance wage, and time based wage system. The statistical analyses indicated differences between the wage systems in relation to physical exertion (ηp=0.05) and time pressure (ηp=0.03) but not to pain or fatigue. Workers on group based performance wage scored higher (i.e., worse) than workers on individual performance based wage and workers with an hourly/monthly wage. In conclusion, group performance based wage was associated with higher levels of physical exertion and time pressure. Accordingly, group performance based wage can be viewed as a factor that has the potential to complicate prevention of MSD among construction workers. Since performance based wage systems are common in many countries across the world, more attention should be paid to the health effects of these types of payment.


2020 ◽  
Vol 1 (2) ◽  
pp. 35-46
Author(s):  
Julia, Andria Syah Putra, Nurfadhilah

This study aims to find out the survey of gapoktan members' satisfaction survey on the role of farmer group members in Gampong Kulam Ara Kecamatan Mutiara Timur. The research started from July 25 until August 15, 2017. The research used descriptive method with population is the whole group of farmer group in Gampong Kulam Ara Sub Mutiara Timur Regency Pidie counted 75 people. Determination of sample of 37 people done by ramdom sampling (random sampling). In this case taken a sample of 37 people for research purposes. The data obtained consist of primary data and secondary data, both qualitative and quantitative data. The analysis used in this research is as follows: P = F / NX100%. The results of this study indicate that the survey of gapoktan members' satisfaction on the role of farmer group members in Gampong Kulam Ara Sub-district of Mutiara Timur Pidie District is included in the good category because it can improve the development of farmer groups in terms of creativity, production and income of farmers through farmer group meetings and the role of executives in the implementation deliberation of farmer groups in the form of participation participation, participation in farmer group meetings and activities, participation in agricultural extension program and group performance capability level in Gampong Kulam Ara Kecamatan Mutiara Timur Kabupaten Pidie.Keywords: Gapoktan, Board Role, Farmer Group


2014 ◽  
Vol 129 (4) ◽  
pp. 1625-1660 ◽  
Author(s):  
Katherine Baldiga Coffman

Abstract We use a lab experiment to explore the factors that predict an individual’s decision to contribute her idea to a group. We find that contribution decisions depend on the interaction of gender and the gender stereotype associated with the decision-making domain: conditional on measured ability, individuals are less willing to contribute ideas in areas that are stereotypically outside of their gender’s domain. Importantly, these decisions are largely driven by self-assessments, rather than fear of discrimination. Individuals are less confident in gender-incongruent areas and are thus less willing to contribute their ideas. Because even very knowledgeable group members undercontribute in gender-incongruent categories, group performance suffers and, ex post, groups have difficulty recognizing who their most talented members are. Our results show that even in an environment where other group members show no bias, women in male-typed areas and men in female-typed areas may be less influential. An intervention that provides feedback about a woman’s (man’s) strength in a male-typed (female-typed) area does not significantly increase the probability that she contributes her ideas to the group. A back-of-the-envelope calculation reveals that a “lean in”–style policy that increases contribution by women would significantly improve group performance in male-typed domains.


2011 ◽  
Vol 383-390 ◽  
pp. 4528-4534
Author(s):  
B. Rahmani Parchikolae ◽  
G. R. Jahanshahloo ◽  
F. Hosseinzadeh Lotf

This paper develops measures, based on the Malmquist productivity index, that enables the decision making units internal efficiencies from those associated with their group characteristics. It has been assumed that the levels of inputs and outputs are not known exactly. The analysis involves the construction of an index reflecting the relative performance of example, which can be decomposed into an index for the comparison of efficiency change index and an index for comparison of technological change index. We provide a computational method for extension the Malmquist index group A relation to group B interval data. The utilization of the proposed approach is demonstrated with an illustrative example.


2015 ◽  
Vol 14 (2) ◽  
pp. 189-206
Author(s):  
Jonathan Farrar ◽  
Theresa Libby ◽  
Linda Thorne

Purpose – The purpose of this paper is to examine the effects of three different types of budget goals (egocentric individual, groupcentric individual and group) on group performance of an additive task, assigned within an individual budget-based incentive contract. While previous research has established that budget-based incentive contracts motivate higher group performance than piece rate contracts for additive group tasks, no studies, which we are aware of, have considered explicitly the type of goal within this context. Design/methodology/approach – We conduct a 3 × 2 experiment in which we manipulate the presence of an individual goal (egocentric, groupcentric and absent) and a group goal (present and absent) on group performance of an additive task. Findings – Group performance is higher for groups assigned groupcentric individual goals than for groups assigned egocentric individual goals, either alone or in combination with a group goal. Practical implications – Egocentric individual goals may reinforce an individualistic orientation, which may work against the potential gains from having group members adopt more of a group focus. Originality/value – This paper considers how groupcentric individual goals may improve group performance. The management accounting literature typically examines just egocentric individual goals.


2008 ◽  
Vol 20 (s1) ◽  
pp. 1-18 ◽  
Author(s):  
Ronald N. Guymon ◽  
Ramji Balakrishnan ◽  
Richard M. Tubbs

ABSTRACT: We extend Fisher et al. (2003) to investigate the effectiveness of a budget-based incentive contract to settings with alternate task characteristics.We first replicate their finding: when groups perform a task with an additive production function, a budget-based contract leads to higher levels of performance than a piece-rate contract. However, we do not find higher performance when we modify the task to be interdependent, arguably a key feature of group tasks. We also show that goal commitment mediates the incentive contract-performance relation for tasks with an additive production function. Collectively, these results suggest that variations in production technology influence the relative motivational effectiveness of different incentive plans.


Author(s):  
R.P. Nayyar ◽  
C.F. Lange ◽  
J. L. Borke

Streptococcal cell membrane (SCM) antiserum injected mice show a significant thickening of glomerular basement membrane (GBM) and an increase in mesangial matrix within 4 to 24 hours of antiserum administration (1,2,3). This study was undertaken to evaluate the incorporation of 3H proline into glomerular cells and GBM under normal and anti-SCM induced conditions. Mice were administered, intraperitoneally, 0.1 ml of normal or anti-SCM serum followed by a 10 µC/g body weight injection of 3H proline. Details of the preparation of anti-SCM (Group A type 12 streptococcal pyogenes) and other sera and injection protocol have been described elsewhere (2). After 15 minutes of isotope injection a chase of cold proline was given and animal sacrificed at 20 minutes, 1,2,4,8,24 and 48 hours. One of the removed kidneys was processed for immunofluorescence, light and electron microscopic radioautographic studies; second kidney was used for GBM isolation and aminoacid analysis.


Author(s):  
Taber A. Ba-Omar ◽  
Philip F. Prentis

We have recently carried out a study of spermiogenic differentiation in two geographically isolated populations of Aphanius dispar (freshwater teleost), with a view to ascertaining variation at the ultrastructural level. The sampling areas were the Jebel Al Akhdar in the north (Group A) and the Dhofar region (Group B) in the south. Specimens from each group were collected, the testes removed, fixed in Karnovsky solution, post fixed in OsO, en bloc stained with uranyl acetate and then routinely processed to Agar 100 resin, semi and ultrathin sections were prepared for study.


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