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Compensation strategy: does business strategy influence compensation in high‐technology firms?
Author(s) -
Yanadori Yoshio,
Marler Janet H.
Publication year - 2006
Publication title -
strategic management journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 11.035
H-Index - 286
eISSN - 1097-0266
pISSN - 0143-2095
DOI - 10.1002/smj.521
Subject(s) - vesting , compensation (psychology) , executive compensation , business , stock options , industrial organization , strategic management , compensation of employees , implementation , marketing , finance , corporate governance , psychology , art , psychoanalysis , visual arts , programming language , computer science
Drawing on the strategic employee group concept, this study empirically examines whether a firm's innovation strategy influences compensation systems for strategic employee groups in the high‐technology industry. We focus on compensation packages for R&D employees who play a critical role in successful implementations of innovation strategy. Using compensation data for middle‐level managers and professional employees from 237 firms in the high‐technology industry, we found that a firm's strategic intention to pursue innovation has a significant influence on the relative pay level, compensation time horizon, and stock option vesting period lengths of this strategic employee group. Copyright © 2006 John Wiley & Sons, Ltd.