On the Wisdom of Rewarding A While Hoping for B

Richard D. Boettger and Charles R. Greer
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Richard D. Boettger: Department of Management, Texas Christian University, Fort Worth, Texas 76129
Charles R. Greer: Department of Management, Texas Christian University, Fort Worth, Texas 76129

Organization Science, 1994, vol. 5, issue 4, 569-582

Abstract: We explain the deeper organizational wisdom behind what Steven Kerr called the “folly” of seemingly inconsistent reward structures. Modern organizations—even those Kerr specifically criticizes as “fouled-up”—frequently need to serve two contradictory goals at the same time.Three conditions in particular require sophisticated organizations to reward A while nonetheless hoping for B. First, operative goals—e.g., for a police department—may require practical activities like “social work” that do not conform to the official culture of “crime fighting command bureaucracy.” Attempting to reward only these police activities which support the official goals would harm both the force and the citizens they serve. Second, times of great change—e.g., for environmental clean-up in Eastern Europe—require short-term inconsistencies such as supporting a highly polluting factory in order to accomplish long term ends. At one moment in time, a snapshot exposes a “foolish” inconsistency, but a long-term view reveals the wisdom of not attempting to treat complex problems with simple solutions. Third, some conditions of the real world will always require the individual to serve two masters, as in a classic matrix structure. Product and functional demands cannot be made perfectly consistent with each other, and to expect the organization to make them so is to wish for the impossible.Under the above conditions, it is better to teach individuals how to handle complex, inconsistent demands than it is to hold organizations responsible for eliminating them. While Kerr would work towards an organization in which “no one needs goodness,” we would hold our teaching and training systems responsible for making “goodness” and complexity part of the talent an individual brings to the organization. To put complexity and goodness beyond the individual and entirely in the province of the organization is to demand of the organization the impossible, and demean the human beings who are its substance and soul.

Keywords: reward systems; complex organizations; strategic human resource management; organization design (search for similar items in EconPapers)
Date: 1994
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