Personality and Preferences for Characteristics of Pay for Performance Plans: A Path to Job Satisfaction and Customer Satisfaction.
Person-organization fit has been shown to lead to employee job satisfaction which in turn, has been shown to be related to customer satisfaction. Using a person-organization fit framework, relationships between individual differences in the big five personality dimensions and preferences for characteristics of variable pay were investigated. In an experimental setting the relationship between personality and preferences for pay contingent on individual performance versus team performance was investigated. Additionally, the relationship between personality and preferences for the degree of pay at risk (the portion of pay tied to performance) within variable pay systems was investigated. The results indicate that participants who prefer to have their pay contingent on team performance have higher levels of openness to experience than do individuals who prefer to have their pay contingent on their individual performance. Participants who prefer to have greater levels of their pay at risk have higher levels of extraversion and openness to experience and lower levels of neuroticism than do participants who prefer to have lower levels of their pay at risk. These results suggest that there are systematic differences in preferences for components of pay for performance plans by individuals with differing personalities. To maximize the likelihood of employee job satisfaction and customer satisfaction, organizations should select employees whose personalities align with the organization’s pay for performance plan’s characteristics.
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