Collective and individual improvement activities: the role of reward systems

TLDR

Employee participation in continuous improvement is often promoted through problem‑solving teams, yet how to reward effort remains unclear, especially given the company’s historically individualistic reward culture. The study examines how problem‑solving teams influence reward and recognition policies in a UK automotive component firm. The authors used problem‑solving teams within the company to explore these implications. The study found that having separate reward systems for team activities and individual suggestions produced distinct outcomes.

Abstract

Mechanisms for increasing participation of employees in problem‐solving activities such as continuous improvement (CI) programmes often include the use of problem‐solving teams. Teams can support problem solving by emphasizing accountability for the production process within the work unit, thereby increasing the sense of responsibility for (local) problems. However, it is unclear how effort within these organisational forms should be rewarded. This article describes the use of problem‐solving teams within a UK automotive component company, and examines the implications for human resource policy, in particular for the reward and recognition systems. The article outlines the outcomes that ensued when two reward systems existed, one for team‐based activities and another for individual suggestions. The contradictions of the two systems are considered in the context of the organisation’s historical individualistic approach to reward systems.