A Multi-Cultural Study of Salespeople's Behavior in Individual Pay-for-Performance Compensation Systems: When Managers Are More Equal and Less Fair than Others

Journal of Personal Selling and Sales Management, 37 (3), 198-212 (2017)

39 Pages Posted: 29 Jul 2019

See all articles by Dominique Rouzies

Dominique Rouzies

HEC Paris

Vincent Onyemah

Babson College - Marketing Division

Dawn Iacobucci

Vanderbilt University - Marketing; Vanderbilt University - Marketing

Date Written: 2017

Abstract

In this research, we examine salespeople’s behavior in individual pay-for-performance compensation systems and show how perceived management fairness seems to energize sales employees in some environments but not in others. We use a large multicountry database of individual-level remuneration for more than 2,500 salespeople across four B2B industry sectors to demonstrate cultural adaptations of the effect of perceived management fairness. The results indicate that top management should be concerned with employees’ perceptions of fairness in addition to the more typical concerns of control and motivation widely acknowledged in the microeconomics-based sales-force compensation literature. In particular, we show that perceptions of management fairness are key to salespeople’s proportion of total pay generated by pay-for-performance formulas.

Keywords: financial incentives; fairness; salespeople; international compensation; culture

Suggested Citation

Rouzies, Dominique and Onyemah, Vincent and Iacobucci, Dawn and Iacobucci, Dawn, A Multi-Cultural Study of Salespeople's Behavior in Individual Pay-for-Performance Compensation Systems: When Managers Are More Equal and Less Fair than Others (2017). Journal of Personal Selling and Sales Management, 37 (3), 198-212 (2017), Available at SSRN: https://ssrn.com/abstract=3425953

Dominique Rouzies

HEC Paris ( email )

1 rue de la Liberation
Jouy-en-Josas Cedex, 78351
France

Vincent Onyemah

Babson College - Marketing Division ( email )

Babson Park, MA 02157
United States

Dawn Iacobucci (Contact Author)

Vanderbilt University - Marketing ( email )

Nashville, TN 37203
United States

Vanderbilt University - Marketing ( email )

Nashville, TN 37203
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
6
Abstract Views
194
PlumX Metrics