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Employee Incentive Systems: Why, and When, They Are So Hard to Change
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******************************** Employee Incentive Systems: Why, and When, They Are So Hard to Change http://knowledge.wharton.upenn.edu/index.cfm?fa=viewfeature&id=1490 In the late 1980s, as part of an effort to beef up its core IT business, Andersen Consulting (now Accenture) began to hire specialist strategy consultants from outside the company. These consultants were more experienced than the usual Andersen employees, and they were accustomed to "much more aggressive individual performance incentives" than was the norm among Andersen's existing IT staff, according to Wharton management professor Sarah Kaplan, author of a recent paper titled, "Inertia and Incentives: Bridging Organizational Economics and Organizational Theory." In the paper, co-authored with Rebecca Henderson from MIT's Sloan School of Management, the two researchers use Andersen Consulting, Kodak and other organizations to study conflict, especially with regard to incentive systems, that results when companies undergo major change, such as adopting new technologies or shifting into new markets.
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