Publications

28 Nov 2012
What Do You Think?

Should Pay-for-Performance Compensation be Replaced?

compensation committee that meets perhaps 10 times a year, and what is the likelihood they'll get it right? We say we should pay for performance, but how? What do you think? Original Article Pay for... View Details

Keywords: by James Heskett

January 2017 (Revised May 2019)
Case

Kjell and Company: Motivating Salespeople with Incentive Compensation (A)

By: Doug J. Chung

Kjell & Company was a Swedish retail electronics chain. The company’s products consisted of home electronics and accessories. The company was noted for its excellent customer service and a fair “one-for-all” HR policy. Historically, the salespeople had been compensated... View Details

Keywords: Salesforce Management; Compensation and Benefits; Change; Decision Making; Electronics Industry; Sweden

05 Dec 2014
Working Paper Summaries

Seesaws and Social Security Benefits Indexing

Keywords: by Matthew Weinzierl

28 Apr 2011
News

The Compensation Silly Season

March 2015
Background Note

Equity Compensation in Startup Ventures

By: Ramana Nanda, Robert White and Stephanie Puzio

Setting equitable and "market" level compensation for founders and early employees of startups is one of the most important elements of a new venture. It is not only central to attract and retain the best human capital for the startup, but is critical to align... View Details

Keywords: Entrepreneurial Finance; Equity; Finance; Entrepreneurship

June 2017 (Revised May 2019)
Supplement

Kjell and Company: Motivating Salespeople with Incentive Compensation (B)

By: Doug J. Chung

Kjell & Company was a Swedish retail electronics chain founded in 1988 by brothers Marcus, Mikael and Fredrik Dahnelius. The company operated 84 stores, all company-owned, located mainly in the metropolitan areas of Sweden’s most popular cities: Stockholm, Gothemburg... View Details

Keywords: Salesforce Management; Compensation and Benefits; Motivation and Incentives; Change Management; Behavior; Electronics Industry; Sweden

2023
Working Paper

Founder-CEO Compensation and Selection into Venture Capital-Backed Entrepreneurship

By: Michael Ewens, Ramana Nanda and Christopher Stanton

We show theoretically that a critical determinant of the attractiveness of VC-backed entrepreneurship for high-earning potential founders is the expected time to develop a startup’s initial product. This is because founder-CEOs’ cash compensation increases... View Details

Keywords: Entrepreneurship; Venture Capital; Executive Compensation

Article

Compensation and Incentives: Practice vs. Theory

By: George P. Baker, Michael C. Jensen and Kevin J. Murphy

Keywords: Compensation and Benefits; Motivation and Incentives; Practice; Theory

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April 2020
Teaching Note

Executive Compensation at Talent Partners

By: Richard S. Ruback, Royce G. Yudkoff and Ahron Rosenfeld

Teaching Note for HBS Case No. 211-073. Talent Partners, a payroll service firm focused on actors in commercials, hired Paul Muratore to be its CEO in 2002. His compensation package included a fixed salary and a bundle of Stock Appreciation Rights (SAR) that would... View Details

Keywords: Executive Compensation; Stock Options; Compensation and Benefits

December 2001 (Revised June 2002)
Case

Compensation at Level 3 Communications

Level 3's unique compensation plan rewarded managers for the firm's performance only if the firm's stock price movement exceeded that of the market. This design was intended to maximize shareholder value by tying manager's performance more closely to that of the firm,... View Details

Keywords: Motivation and Incentives; Compensation and Benefits; Telecommunications Industry

August 2002
Background Note

Customer Benefit Stack

By: Das Narayandas

Describes a process to understand customer benefits created in industrial markets using the metaphor of a customer benefit stack. View Details

Keywords: Customer Satisfaction; Customer Value and Value Chain; Marketing Strategy; Product Marketing; Manufacturing Industry

07 Aug 2008
News

Harvard s discuss compensation and succession

January 2020
Article

Compensation Consultants and the Level, Composition, and Complexity of CEO Pay

By: Kevin J. Murphy and Tatiana Sandino

We provide fresh evidence regarding the relation between compensation consultants and CEO pay. First, firms that employ consultants have higher-paid CEOs—this result is robust to firm fixed effects and matching on economic and governance variables. Second, while this... View Details

Keywords: Consultants; Benchmarking; Incentive Pay; Executive Compensation; Complexity; Motivation and Incentives; Governance

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2019
Working Paper

Compensation Consultants and the Level, Composition, and Complexity of CEO Pay

By: Kevin J. Murphy and Tatiana Sandino

We provide fresh evidence regarding the relation between compensation consultants and CEO pay. First, firms that employ consultants have higher-paid CEOs—this result is robust to firm fixed effects and matching on economic and governance variables. Second, while this... View Details

Keywords: Consultants; Benchmarking; Incentive Pay; Executive Compensation; Complexity; Motivation and Incentives; Governance

September 2014
Article

Income Inequality and Social Preferences for Redistribution and Compensation Differentials

By: William R. Kerr

In cross-sectional studies, countries with greater income inequality typically exhibit less support for government-led redistribution and greater acceptance of wage inequality (e.g., United States versus Western Europe). If individual nations evolve along this pattern,... View Details

Keywords: Equality and Inequality; Income; Government and Politics

June 2000 (Revised December 2000)
Case

Compensation and Performance Evaluation at Arrow Electronics

By: Brian J. Hall and Carleen Madigan

Describes a company's struggles in implementing a subjective performance rating system for its employees. In particular, it describes the difficulties faced by the CEO in getting managers to combat "ratings inflation"--that is, to produce numerical ratings that are... View Details

Keywords: Behavior; Performance Evaluation; Compensation and Benefits; Electronics Industry

Article

Who Benefits from Religion?

By: Daniel Mochon, Michael I. Norton and Dan Ariely

Many studies have documented the benefits of religious involvement. Indeed, highly religious people tend to be healthier, live longer, and have higher levels of subjective well-being. While religious involvement offers clear benefits to many, in this paper we explore... View Details

Keywords: Religion; Values and Beliefs; Welfare

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