Enhancing Return on Salesforce Investment

[We’re pleased to welcome back Pankaj M. Madhani, Associate Dean and Professor of ICFAI Business School (IBS). Dr. Madhani is the author of “Enhancing Return on Salesforce Investment: Reallocating Incentives and Training Resources With Intrinsic Valuation Approach,” which has been published in Compensation and Benefits Review and is currently free to read for a limited time. From Dr. Madhani:]

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What motivated you to pursue this research

In view of escalating budget for sales incentives and training, it is important for sales organizations to optimally allocate these resources to enhance sales performance and retain their best salespeople. Retention of an employee is very important for organizations from the cost perspective. If the best salespeople are not retained, a firm can be negatively affected from the operational level to the strategic level. Owing to the significant investments made in the salesforce in terms of incentives and training, it is important to study the impact of such an investment on a salesperson’s performance. Traditionally, in most sales organizations, salesforce performance evaluation has mostly relied on reflective metrics such as sales volume, revenue, and manager’s evaluations of salesforce, and hence they have limited insight into how a salesperson will do going forward and what types of training and incentives will be most effective. Sales organizations should emphasize sustaining and improving their salesforce performance with strategic decisions about rewards and training optimization.

In what ways is your research innovative, and how do you think it will impact the field?

This research develops “Intrinsic Valuation Approach” and provides various decision frameworks for determining salesforce resource allocation. Optimizing a salesperson’s training and incentive resources according to “Intrinsic Valuation Approach” can improve sales performance. With such proactive approach, sales organizations not only identify a better salesperson but also realize why a salesperson’s profit potential (i.e., intrinsic value) is plateauing/decreasing while another salesperson’s intrinsic value is high. Research also emphasizes that all sales employees do not perceive organizational rewards and training alike because for some groups certain needs can be more prominent than others. A combination of incentives and training needs had the biggest impact on salespeople’s intrinsic value. Reallocation of incentives and training resources based on proactive approach developed in this paper not only reduces sales employee turnover but also enhances performance of retained employees because it takes into consideration the needs of the sales employees and the requirements of the organization.

What advice would you give to new scholars and incoming researchers in this particular field of study?

“Intrinsic Valuation Approach” is a predictive analytic that forecasts intrinsic value of salespeople. Such futuristic analysis provides the starting point for finding an answer to the salesforce resource allocation questions but there is need to empirically study interactions and interdependency of specific parameters such as:

1. What are the drivers of a salesperson’s future performance, and what is their impact?
2. Is there significant heterogeneity within the salesforce that affects intrinsic value?
3. What type of rewards and training will bring out the best in a high achiever or help a
promising sales employee improve?

Although, “Intrinsic Valuation Approach” links organizational factors (e.g., training and incentives), it does not investigate the role of the salesperson’s cognitive and attitudinal elements (e.g., motivation, ability /aptitude) that could mediate the effect between organizational variables
and intrinsic valuation. Hence, future research could study the mediating variables and adopt a dynamic model to describe the time-varying effects of the parameters in a more “continuous” sense, thereby building on this research stream.

 

 

Pankaj M. Madhani earned bachelor’s degrees in chemical engineering and law, a master’s degree in business administration from Northern Illinois University, a master’s degree in computer science from Illinois Institute of Technology in Chicago, and a PhD in strategic management from CEPT University. He has more than 30 years of corporate and academic experience in India and the United States. During his tenure in the corporate sector, he was recognized with the Outstanding Young Managers Award. He is now working as an associate dean and professor at ICFAI Business School (IBS) where he received the Best Teacher Award from the IBS Alumni Federation. He is also the recipient of the Best Mentor Award. He has published various management books and more than 300 book chapters and research articles in several refereed journals. He has received the Best Research Paper Award at the IMCON-2016 International Management Convention. He is a frequent contributor to Compensation & Benefits Review and has published more than 20 articles on sales compensation. His main research interests include salesforce compensation, corporate governance and business strategy. He is also editor of The IUP Journal of Corporate Governance.

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The 2017 GOM Best Paper Awards

gomb_43_4_coverWe would like to congratulate the following winners for their achievements! Below are the abstracts of each outstanding article. Please note that the full articles will be free to read for a limited time.


Group & Organization Management 2017 Best Conceptual Paper Award:

Congratulations to authors, Anastasia Sapegina and Antoinette Weibel of the University of St. Gallen for their outstanding article, “The Good, the Not So Bad, and the Ugly of Competitive Human Resource Practices: A Multidisciplinary Conceptual Framework.”

hiring-1977803_960_720.jpgHuman resource (HR) practices used to inject internal competition into the workplace are the subject of heated debates in business practice; this is however not the case in the field of human resource management (HRM) research. In this article, we first augment previous research in the field to offer an initial conceptualization of competitive HR practices. We then develop a conceptual framework that explains the processes and conditions that drive and determine the impact of competitive HR practices on employees at work. Blending insights from social comparison theory and uncertainty research, we theorize a set of conditions that specify when competitive HR practices unfold their “dark” side, and when the “not so bad” or even “a good side” of competitive HR practices might emerge.


Group & Organization Management 2017 Best Empirical Paper Award:

Congratulations to authors, Nale Lehmann-Willenbrock of Vrije Universiteit Amsterdam, Ming Ming Chiu of Purdue University, Zhike Lei of Georgetown University, and Simone Kauffeld of Technische Universität Braunschweig, for their outstanding article, “Understanding Positivity Within Dynamic Team Interactions: A Statistical Discourse Analysis.”

170705-F-XX000-0004Positivity has been heralded for its individual benefits. However, how positivity dynamically unfolds within the temporal flow of team interactions remains unclear. This is an important oversight, as positivity can be key to team problem solving and performance. In this study, we examine how team micro-processes affect the likelihood of positivity occurring within dynamic team interactions. In doing so, we build on and expand previous work on individual positivity and integrate theory on temporal team processes, interaction rituals, and team problem solving. We analyze 43,139 utterances during the meetings of 43 problem-solving teams in two organizations. First, we find that the observed overall frequency of positivity behavior in a team is positively related to managerial ratings of team performance. Second, using statistical discourse analysis, we show that solution-focused behavior and previous positivity within the team interaction process increase the likelihood of subsequent positivity expressions, whereas positivity is less likely after problem-focused behavior. Dynamic speaker switches moderate these effects, such that interaction instances involving more speakers increase the facilitating effects of solutions and earlier positivity for subsequent positivity within team interactions. We discuss the theoretical and managerial implications of micro-level team positivity and its performance benefits.


Thank you for your outstanding contributions!

To explore this journal further, checkout the homepage!


HR Photo attributed to Free Photos.

Positivity Photo attributed to Free Photos.

Identity, Mental Health and Work

[We’re pleased to welcome author Hadar Elraz of Cardiff University. Hadar Elraz recently published an article in the Human Relations entitled “Identity, mental health and work: How employees with mental health conditions recount stigma and the pejorative discourse of mental illness,” which is currently free to read for a limited time. Below, Hadar Elraz summarises the findings of her study:]

Experiences of mental health in the workplace

huma_71_2.coverThis article examines how identity is constructed for individuals with mental health conditions in the workplace. The study found that people with mental health conditions use their experiences to perform more effectively in the workplace. The same strategies that individuals put in place to manage their mental health can also be applied to prioritize workload effectively, promote mental health awareness and achieve work‒life balance.

In a series of 60 interviews, the study reveals how people with mental health conditions overcome stigma, judgement and discrimination to stay in employment and, in many cases, prosper in the contemporary workplace. Those who have experienced mental ill health have knowledge and expertise about the interface between work and their condition and ways to address them.

The findings shows how the individual sensitivity to these issues addresses all kinds of strategies to manage their mental health and working lives more effectively. The interviews revealed the following coping strategies used by the study participants to manage their mental health conditions:

Maintaining silence

Some respondents recalled how they would maintain silence, coping on their own against all the odds without requesting support. While anti-stigma campaigns and awareness training are not uncommon in many contemporary workplaces, interviewees still felt looked down upon and discriminated against. Non-disclosure might be one response to this type of hostile environment.
One respondent recalled how they “didn’t think people associated mental illness with people who are functioning in high-status jobs. [Instead,] people associate mental illness with people who can’t work.”

Sheer hard work

Others developed strategies to manage their mental health effectively alongside their responsibilities at work, to stay, cope and thrive in employment.

Doubling their efforts in this way led many respondents to reflect on how they have grown more resilient than their colleagues who have not experienced mental ill health.

One respondent said: “I am a strong character. [But,] I don’t think people realise how strong a character you are. They don’t have any reference, because they never suffered from it [mental health condition] themselves.”

Another referred to this as “sheer hard work”, adding: “I just absolutely feel like I’m working twice as hard as anyone else in the place to achieve the same level of output.”

Taking control

Study participants used self-taught and reflexive techniques as well as self-medicating to take control of their health and performance at work. Combining both soft skills and medical insight into their condition made many of the participants experts on managing their mental health conditions within and beyond the working environment.

One respondent said: “I have been doing that for years. I self-manage myself by taking mood stabilisers, anti-depressants […] finding one that works to get you up to a level where you can function.”

Public disclosure

While concealing mental ill health in the workplace was a key concern for many interview participants, some spoke of the positive outcomes associated with public disclosure.
Significantly, the interviewees that were more confident about the security of their employment found public disclosure raised awareness and improved mental health management. Motivated by a desire to share their experiences of mental ill health to encourage broader cultural change, these participants expressed eagerness to assist both employee wellbeing and organisational performance by openly disclosing their mental health experiences at work.

One respondent said: “I think it’s part of me. Why should I hide away? If I see other people, I think if I gave them a bit of insight and knowledge, maybe that’d save them from going through some of the things.”

Allaying their fear of stigma and discrimination, public disclosure represented a legitimisation of mental ill health within the working environment.

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When Leadership Powers Team Learning: A Meta-Analysis

[We’re pleased to welcome authors Mieke Koeslag-Kreunen of Zuyd Hogeschool, Heerlen, Piet Van den Bossche of the University of Antwerp, Michael Hoven of Maastricht University, Marcel Van der Klink of Zuyd Hogeschool, Heerlen, and Wim Gijselaers of Maastricht University. They recently published an article in Small Group Research entitled “When Leadership Powers Team Learning: A Meta-Analysis,” which is currently free to read for a limited time. Below, they discuss some of the findings of this research:]

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What motivated you to pursue this research?

We are fascinated why some leaders succeed and others don’t in getting the most out of their teams. Knowing that team processes determine team effectiveness we wanted to know how leadership makes a difference in teams. Keeping in mind that one of the fundamental team processes is sharing knowledge and discussing what is shared to build advanced or new knowledge that enable developing the necessary solutions as a team. We were intrigued by the question how team leaders can facilitate this process of team learning without over-structuring it and leaving no space for team members to exhibit the necessary behaviors themselves. Many different leadership behaviors can be effective, but team leaders simply cannot display all necessary behaviors by themselves. Moreover, what can you do as a team leader when your team faces a task that is unstructured or for which you also do not have the answers? What is the best advice for these team leaders? In answering this question, we wanted to identify when leadership propels teams in building new or advanced knowledge.

In what ways is your research innovative and can it impact the field?

After synthesizing the 2000+ scientific hits on the topic, we showed that encouraging, structuring and sharing team leadership behaviors all support team learning. Interestingly, we also found new evidence that the type of team task determines which leadership behaviors can best be displayed to support teams in building new or advanced knowledge. As a consequence, the advice for team leaders is to vary their behavior depending on the team task and to ascertain the specific team situation in their choice. If pioneering ideas and new products of teams are aimed for, team leaders should mainly invest in building trust, creativity and enthusiasm, and not inhibit teams from learning by putting too much emphasis on the task. If advancing existing knowledge and adaptation of the products is enough to reach team success, team leaders who focus on the task, methods and outcomes are beneficial because such behaviors reinforces using known protocols.

What advice would you give to new scholars and incoming researchers in this particular field of study?

It would be interesting to dig into the reciprocal effect of the team process and leadership behavior, as well as how leadership behavior may shift in style and source over time. We mainly found cross-sectional studies that covered just one or two types of team leadership behavior and examines its influence on team learning behavior. Experimental and longitudinal studies on this topic may bring new perspectives on how team leaders can vary their behavior, what kind of effect that has on team learning, and what team leaders can do to use that information in future team interactions, subsequently.

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Enhancing Return on HR Investment

[We’re pleased to welcome back Pankaj M. Madhani, Associate Dean and Professor of ICFAI Business School (IBS). Dr. Madhani is the author of “Enhancing Return on HR Investment: Risk Management With Real Options Approach” which has been published in Compensation and Benefits Review and is currently free to read for a limited time. From Dr. Madhani:]

CBR_42_1_72ppiRGB_powerpointWhat motivated you to pursue this research?

For any organization, human resources (HR) are assets that can provide value and competitive advantage; however, such assets have associated uncertainties and risks. There is growing recognition that one of the key risks in a business is related to management of HR. As HR inherently involves a level of uncertainty, and as risk management’s main focus is uncertainty, forging the two fields of risk management and HR is important. Returns on HR investment may not remain stable over time for organizations due to changes in business conditions. The ability of the organizations to operate flexibly in dynamically changing business conditions is crucial on the long run. The “real options” approach enables organizations to evaluate investment opportunities of HR in uncertain environments and highlights how these investments create value through future choices (i.e., options). Research applies this logic to analyze the uncertainties associated with HR assets in organizations and discuss how organizations manage these uncertainties through HR “options,” which are capabilities generated by some HRM practices and their combinations.

In what ways is your research innovative, and how do you think it will impact the field?

The research emphasizes role of HR options in hedging HR related risks and uncertainties and provides risk management guidelines to practicing managers for enhancing return on HR investment. Extending the concept of real options, the research underlines certain HRM practices as creating HR options in terms of reducing uncertainties related to returns, volume and combinations and costs. The value of HR options lies in allowing the organizations to respond proactively to the uncertainties of human assets. HR options enable the organizations to develop and deploy human capital in order to limit downside risk caused by environmental uncertainty and create opportunities for greater returns in the future. In this research, various types of options, such as switching options, growth options, learning options, timing options, scaling options and turnover and productivity HR options are developed. Deployment of such HR options creates a strategic organizational capability to adapt to future contingent events and flexibly manage risks and uncertainties associated with investments in HR. Research also provides various real-life illustrations of such successful deployment of HR options in organizations.

What advice would you give to new scholars and incoming researchers in this particular field of study?

HR options may manage more than one type of risks and have synergistic effects when they act in “bundles” of multiple interacting options. However, when there is no synergy among various HR options related to different types of uncertainty, such as uncertainty of returns, volume and combinations and costs, it results in suboptimal performance. In this scenario, hedging one type of uncertainty will increase other related uncertainties (e.g., managing uncertainty of volume and combinations may lead to increased uncertainty of costs). Thus, there is need to study interactions and interdependency of various HR options to mitigate overall risks, quantify numerically each of the investment options and  investigate the linkage between deployment of HR options and the organization’s operational and financial performance.

 

Pankaj M. Madhani earned bachelor’s degrees in chemical engineering and law, a master’s degree in business administration from Northern Illinois University, a master’s degree in computer science from Illinois Institute of Technology in Chicago, and a PhD in strategic management from CEPT University. He has more than 30 years of corporate and academic experience in India and the United States. During his tenure in the corporate sector, he was recognized with the Outstanding Young Managers Award. He is now working as an associate dean and professor at ICFAI Business School (IBS) where he received the Best Teacher Award from the IBS Alumni Federation. He is also the recipient of the Best Mentor Award. He has published various management books and more than 300 book chapters and research articles in several refereed journals. He has received the Best Research Paper Award at the IMCON-2016 International Management Convention. He is a frequent contributor to Compensation & Benefits Review and has published more than 20 articles on sales compensation. His main research interests include salesforce compensation, corporate governance and business strategy. He is also editor of The IUP Journal of Corporate Governance.

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Argument Complexity and Discussions of Political/Religious Issues

[We’re pleased to welcome authors, Dr. Lyn M. Van Swol of the University of Wisconsin–Madison, Dr. Cassandra L. Carlson-Hill Carolina of Coastal Universit, and Dr. Emily Elizabeth Acosta Lewis of Sonoma State University. They recently published an article in Small Group Research entitled “Integrative Complexity, Participation, and Agreement in Group Discussions,” which is currently free to read for a limited time. Below, Dr. Van Swol discusses some of the findings of this research:]

SGR_72ppiRGB_powerpointPolitical and religious issues can be difficult to discuss in a group, and it can be especially difficult to convince others who disagree with your viewpoint. This paper examined the role of complexity of arguments in a group discussion of a political/religious issue. Groups discussed whether or not the words “under God” should be in the United States Pledge of Allegiance. We had hypothesized that group members whose opinion were more similar to their fellow group members would increase the complexity of their contributions to the group when they were exposed to group members with more fringe opinions, but this was not supported. However, members with more fringe opinions in the group were more successful in influencing the group towards their opinion when they used more complex arguments. Argument complexity did not matter for group members with more mainstream views in terms of how much they influenced the group decision. Because group members with more fringe and discrepant opinions cannot appeal to their opinion being normative and aligned with the majority in the group, it may be important for them to have complex arguments to be persuasive. Complex arguments tend to be more nuanced and less dogmatic, which may make someone with an opinion more different from others in the group seem more flexible and informed. Finally, arguments used by members in the group discussion were more complex when the group had a longer discussion. This highlights the benefits of extending group discussion to let more nuances of the topic of discussion get expressed.

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Strategic Value Contribution Role of HR

VisionIn the face of climate change and unaccountable corporations, consumers are increasingly vocal about their desire to support transparent companies that actively fight for social justice and offer eco-friendly products and alternatives to conventional items. In response, more brands are demonstrating accountability. Some of the fastest growing businesses are those in the natural product category, those with recycled and recyclable packaging, sweatshop-free and fair trade sourcing, and brands with affiliations with charitable organizations. All else equal, people are investing in brands they feel align with their values.

But, unfortunately it has been found that in spite of showing concern for the environment and advocating environmentally safe activities, the Indian consumer is still not ready to accept the hard truth that it the responsibility of one and all to minimize their contribution to the overall environmental pollution. This article from the journal ‘Vision’ aims at studying socio-psychological factors which contribute in the formation of environmental attitude of consumers. It further aims at establishing the connection between environmental attitude of the consumer and his/her willingness to buy environmentally friendly products.

The socio-cultural, psychological and demographic factors have manifested divergent relationship between attitude and behaviour. There is inadequate understanding of antecedents of consumer’s environmentally friendly attitude and willingness to buy environmentally friendly product. Some authors argue that many consumers claim that they care about the environment; their buying behaviour does not always reflect this concern.

It has been found that the dimensions, such as environmental knowledge (EK), perceived seriousness of environmental (PSE) problem, interpersonal influence (IPI), collectivism and long-term orientation (LTO), have positive relationship with consumer environmental attitude (CEA)

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