**2. Literature review**

From this perspective, what has captured our interest research is the fact that a complex and profoundly articulated relationship exists uniting cultural dimensions and the adoption of bonus systems for the team.

Team-based bonuses are the best way to encourage cooperation [13] and "are likely to enhance members' pro-social behaviors and as a result, boost members' capabilities, flexibility, responsiveness, and productivity" [14].

his or her target. For example, if a target is achieved or if a deadline is met, the team can be rewarded with a bonus. A reward can be monetary or nonmonetary. It can be given as either a bonus or an incentive. These terms are different. In fact, a monetary reward is a financial benefit given to an individual or a team. A nonmonetary reward can be measured in nonfinancial terms, and it can even be a simple appreciation or gift. The bonus is considered as an "integral integrating mechanism" through which it's possible to achieve an organization's strategic objectives" and it derives by a "deliberate utilization of the pay system" [3]. It is a monetary managerial tool that contributes to achieve high levels of performance [4] by group behavior [5]. The research shows that frequently incentive systems each have different effects (positive or negative) on team members [6]. Several are advantageous, improving communication skills, increasing the involvement of employees, promoting cooperation among employees, intensifying stronger bonds among the workers, developing a friendlier climate at the workplace, which improves efficiency personnel. In most cases in a group, it is possible to exchange ideas creating a synergism that contributes to motivate the employees' to strive toward the common goal. This is the consequence of the fact that cooperation helps to achieve tasks for workers who could not perform individually, even if sometimes the outcome is quite different. It's possible, in fact, that they lose the sense of how each and every one of them is contributing

to reaching the goal causing competition instead of cooperation.

when organizations are more likely to use them and when not.

dimensions can have on incentives' use. Section 5 presents conclusions.

culture, and supporting such changes [11].

**2. Literature review**

172 Organizational Conflict

bonus systems for the team.

For this reason, incentives are critical to the functioning of the team [7–9].

Thanks to team-based incentives, companies can motive personnel to be self-going [10] and as well as ultimately lead to organizational effectiveness. They are able to develop a sharing knowledge if the bonus is delivered when everybody has the same level of knowledge.

So, organizations are using group-based bonus plans to initiate changes in organizational

Our results make two important contributions to the literature. First, our paper contributes to the discussion of the impact of cultural identity in organizations. The results show that cultural dimensions can have different effects on incentive schemes. Secondly, our research shows that 'cultural' factors critically affect how incentives are distributed and as a result,

The chapter proceeds as follows: a short literature review is presented in Section 2 and the methodological design is described in Section 3. Section 4 discusses results of the research questions based on a logit model that illustrates the different effects Hofstede's [12] cultural

From this perspective, what has captured our interest research is the fact that a complex and profoundly articulated relationship exists uniting cultural dimensions and the adoption of The choice of planning a bonus for teamwork depends on differences reflected in cultural diversity [15]. In actual fact, the mental attitudes of management can be influenced by the context, which, in turn, may be planned with intention.

A short literature review has identified several arguments in postulating the nature of the relationships among cultural dimensions. Cultural differences, as Hofstede affirms in his study, reflect different values: rituals, heroes, symbols, and practices represent factors which involve different levels—national and individual—and, influencing bonus strategies, they can lead the generating competitive advantage for the firm [16]. In fact, several researchers have explored the relationship between national culture and its role while designing bonus, highlighting that a mismatch between compensation strategies and cultural characteristics can have important consequences. For example, in 1998 Hampel [17] showed how national cultural values of Hofstede's model influence the choice of different social benefits. In addition, Schuler and Rogovsky [18] have explored the relationship between the cultural dimensions suggested by Hofstede and compensation practices based on status performance. Researchers have noted that "Whether employees like team incentives … depends on whether the reward system is congruent with the other management systems and the philosophy and culture of the organization" [19]. National culture is important because it provides employees a shared understanding of the behaviors that will be valued by the organization .

In fact, different styles and contents allow us to understand because in some organizations team incentive systems are present and if they are good tools to motivate employees. For example, members with highly collectivistic values contributed to their group's performance [20], on the contrary individualists are more motivated by personal gain and their contribution to a team is driven only by personal interest. In a highly individualistic organizational culture, the introduction of bonus for teams is likely to be faced with considerable resistance whereas team-based rewards are more likely to be embraced in organizations with collectivistic cultures [21].

Cultural values may be important to the success of team-based rewards because team goals and expectations must be communicated to employees, achievements must be recognized, and feedback must be shared [22]. Research on individualistic/collectivistic is more observed in small than large group and when they can be identified [23].

There are numerous studies about culture [24–38], but most of the literature, especially that one that focuses on a collective approach, is based on studies carried out by Hofstede [29, 39].

Hofstede's survey was conducted twice around 1968 and 1972 producing more than 116.000 questionnaires. The people interviewed were employees of IBM in more than 50 countries and 3 regions. In the first analysis, he analyzed four cultural dimensions (Hofstede's classic model): power distance, individualism, masculinity, and uncertainty avoidance. Later, he added a fifth dimension related to Confucian countries: long-term orientation.

Hofstede assessed the different societies on the basis of the results and gave them a score between 0 and 100 defining more closely the shape of the dimension in that country.

Power Distance (PDI) measures "*the degree to which the less powerful members of a society accept and expect that power is distributed unequally*".

Individualism (IDV) expresses the degree of how much people are integrated into groups. That is if the feeling of "we" or "I" is present.

Masculinity (MAS) suggests the society's preference "*for achievement, heroism, success on the masculine side – or the preference for cooperation*", taking care for others and quality of life on the feminine side.

Uncertainty Avoidance (UAI) reveals how people, in different countries, deal with uncertainty and ambiguity. Pragmatic (PRA) examines the society's thinking on the present and the future.

Long-term oriented people prefer to live in a sustainable way and they try to create change in the situations to get maybe even better future prospects. In short-term oriented societies, on the contrary, people are linked to the past and present values such as national pride, respect for tradition, preservation of "face", and fulfilling social obligations. In 2010, Minkov added a new dimension: the Pragmatism [40]. It deals with similar questions of long-term orientation. Hofstede's study uses the Pragmatic vs. Normative approach for its surveys. The Pragmatic vs. Normative dimension represents the desire of individuals to explain the things, which are going on all around us. In normative societies, people want to explicate all things and want to investigate the secret how something is happening. But in pragmatic societies individuals just try to manage the situations and live without thinking what it'll happen. In this case, it's probable that they accept and adapt to different situations. The sixth dimension is Indulgence (IND). A high level of indulgence means that a society gratifies the natural human impulse and essential needs and desires as well as to have fun. In other countries, the society establishes rules and norms to control human life and restricts the gratification of the cited needs. Today these values have been analyzed for 74 countries.

In this context, the tools offered by inferential statistics will allow to use the survey data to make predictions on the countries for which there is not any type of observations, neither according to Hofstede's approach. This way, it is possible to predict and estimate, through a function, which elements of cultural dimensions can help or hinder the use of incentives for

Impact of National Culture on the Bonus' Use for Teamwork

http://dx.doi.org/10.5772/intechopen.75909

175

The dependent variable is bonus' use for managers, professionals, and clericals that operate in teamwork. The source of these data is the Cranet Survey, a research project carried out in 2014–2016 by a global network of HRM studies. This project, originally launched in 1989 by the Cranfield University, studies HRM within private, public and non-profit sectors, through a detailed questionnaire administered simultaneously in many countries (more than 40) by local research groups. The questionnaire investigates Human Resource strategies in organizations and its responses have been gathered in a unique database. The analyzed variable, used in this analysis, responds to the question: "Do you offer any Bonus based on team goals/

the group.

performance?"

The sample of this research consists of 1253 firms.

**Table 1.** Critique of Hofstede's studies Methodological design.

**2.1. Dependent variable**

**Table 1** [41–46] below offers an overview of the critique of Hofstede's studies by key researchers in the field:

Based on the theories from the literature, a set of propositions is developed that reflects relationships between national culture and employees' bonus. In particular, the study tries to answer the following research questions:

RQ 1. Do Hofstede's cultural dimensions influence the use of bonus systems for a team?

RQ 2. Is the relation between the use of bonus systems for team and Hofstede's cultural dimensions positive/negative and relevant?

To investigate the above research question, data collected in the Cranet Survey are used (2014–2016). The units of observation are firms, public, and nonprofit organizations located in 7 European Countries: Austria, Denmark, Finland, Greece, Italy, Spain, and Sweden.


**Table 1.** Critique of Hofstede's studies Methodological design.

In this context, the tools offered by inferential statistics will allow to use the survey data to make predictions on the countries for which there is not any type of observations, neither according to Hofstede's approach. This way, it is possible to predict and estimate, through a function, which elements of cultural dimensions can help or hinder the use of incentives for the group.

#### **2.1. Dependent variable**

Hofstede assessed the different societies on the basis of the results and gave them a score

Power Distance (PDI) measures "*the degree to which the less powerful members of a society accept* 

Individualism (IDV) expresses the degree of how much people are integrated into groups.

Masculinity (MAS) suggests the society's preference "*for achievement, heroism, success on the masculine side – or the preference for cooperation*", taking care for others and quality of life on the

Uncertainty Avoidance (UAI) reveals how people, in different countries, deal with uncertainty and ambiguity. Pragmatic (PRA) examines the society's thinking on the present and

Long-term oriented people prefer to live in a sustainable way and they try to create change in the situations to get maybe even better future prospects. In short-term oriented societies, on the contrary, people are linked to the past and present values such as national pride, respect for tradition, preservation of "face", and fulfilling social obligations. In 2010, Minkov added a new dimension: the Pragmatism [40]. It deals with similar questions of long-term orientation. Hofstede's study uses the Pragmatic vs. Normative approach for its surveys. The Pragmatic vs. Normative dimension represents the desire of individuals to explain the things, which are going on all around us. In normative societies, people want to explicate all things and want to investigate the secret how something is happening. But in pragmatic societies individuals just try to manage the situations and live without thinking what it'll happen. In this case, it's probable that they accept and adapt to different situations. The sixth dimension is Indulgence (IND). A high level of indulgence means that a society gratifies the natural human impulse and essential needs and desires as well as to have fun. In other countries, the society establishes rules and norms to control human life and restricts the gratification of the cited needs.

**Table 1** [41–46] below offers an overview of the critique of Hofstede's studies by key research-

Based on the theories from the literature, a set of propositions is developed that reflects relationships between national culture and employees' bonus. In particular, the study tries to

RQ 2. Is the relation between the use of bonus systems for team and Hofstede's cultural

To investigate the above research question, data collected in the Cranet Survey are used (2014–2016). The units of observation are firms, public, and nonprofit organizations located in

RQ 1. Do Hofstede's cultural dimensions influence the use of bonus systems for a team?

7 European Countries: Austria, Denmark, Finland, Greece, Italy, Spain, and Sweden.

between 0 and 100 defining more closely the shape of the dimension in that country.

*and expect that power is distributed unequally*".

That is if the feeling of "we" or "I" is present.

Today these values have been analyzed for 74 countries.

answer the following research questions:

dimensions positive/negative and relevant?

feminine side.

174 Organizational Conflict

the future.

ers in the field:

The dependent variable is bonus' use for managers, professionals, and clericals that operate in teamwork. The source of these data is the Cranet Survey, a research project carried out in 2014–2016 by a global network of HRM studies. This project, originally launched in 1989 by the Cranfield University, studies HRM within private, public and non-profit sectors, through a detailed questionnaire administered simultaneously in many countries (more than 40) by local research groups. The questionnaire investigates Human Resource strategies in organizations and its responses have been gathered in a unique database. The analyzed variable, used in this analysis, responds to the question: "Do you offer any Bonus based on team goals/ performance?"

The sample of this research consists of 1253 firms.

Observing **Figure 1**. it comes out that the sample is constituted for 64% by private sector, 28% by the public sector, 4% by not for Profit, 6% mix.

Our sample includes a company with different size. Our investigation is inherent in the SME geographically located in Europe, so it is defined as a small business enterprise which has fewer than 250 employees; medium size company that one which has a number of employees between 250 and 500, and large enterprise with more than 500 employees (**Figure 2**).

The choice to use the number of employees to differentiate businesses as the only criterion has been driven by the objectivity and simplicity of application, even if it has important limitations: primarily because the number of people employed is dependent on the sector of the business [47] and this is why social recruitment has been related also to the sector of the business; then because full-time employment is decreasing, while there are new innovative forms of work such as part-time work, casual work or temporary work [48]. For this element, it has chosen to include the number of employees even those with more flexible forms of contract.
