Team Based Incentive Rewards : It's Not All Roses

CASE SUMMARY

Network Cable, Inc., operates throughout the central and southern portions of Florida's east coast. The company is a service provider for cable TV and high-speed Internet connections. In January 2001, Tara Gilbert, vice president of human resources for Network Cable, convinced company president and CEO Jeff Lesitner that restructuring the organization workforce into teams would benefit both Network Cable and its employees. Forty installers were formed into eight teams of five installers each. Management set performance goals for the installation teams linked to attractive incentive rewards (cash bonuses above base salaries) when performance goals are reached.

During August 2002, Tara Gilbert sent to all installers and their supervisors a survey requesting feedback on the satisfaction with teams and, specifically, the incentive rewards program. While survey results were generally positive, not all was rosy.

Questions and Answers!

(1)Do results from the survey illustrate typical complains about teams? Explain.es who benefited from the efforts of superior employees.

The survey results indicate typical complaints about teams and team incentive rewards. The 1st point of the survey result indicates "free rider effect"- one individual puts in less effort than others but shares equally in team rewards. They generally do not foster team spirit.

The 2nd and the 3rd points reflect "inter group social problems"- pressure to limit performance. Because the super performers may make the average performers look bad. So in spite of showing team synergy and motivation, the average performers involve in bickering or office politics to safe guard their position. Some teams are constantly assigned tougher jobs to prevent them from excelling in work. The 2nd and the 3rd points reflect "inter group social problems"- pressure to limit performance. The 4th point shows that complex payout formulas can be difficult for team members to understand. They want the fixed across-the-board salary increase.

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