Mendes de Brito Antunes, Bethania
(2012)
Reward systems in nonprofit organisations – an assessment of
employee motivations in the homelessness sector in England.
PhD thesis, London School of Economics and Political Science.
Abstract
Government reforms have led nonprofit organisations (NPOs) to become more
involved in the provision of mainstream public services in the UK and consequently
they have been subject to an increasingly demanding regime of performance
measurement and inspection if they wish to provide services on behalf of the state.
The creation of a contract culture has put nonprofit providers in a position where
they have to bid against each other to deliver pre-determined services, resulting in a
very competitive operating environment. NPOs have become more professionalised
and performance-driven and this new climate encourages a business-like attitude to
the management of their services. Pay-for-performance schemes have become a
recognised phenomenon in NPOs, despite having generated controversial discussion
in the literature. The literature on incentive theories has been applied almost
exclusively to private sector organisations and limited attention has been devoted to
the nonprofit sector. It is argued here that one cannot simply transfer across for-profit
sector ideas; one must try to establish a framework that is more suited to the logic of
the NPO. The aim of this thesis is twofold. First, it investigates the use of
performance-related pay (PRP) in nonprofit housing associations in England and
looks at whether PRP acts as a motivator encouraging nonprofit employees to
improve their work performance. Second, it inquires whether the new competitive
and performance-driven environment influences the reward decisions of NPOs. This
thesis examines influences on the choice of reward practices in housing associations
in order to provide an alternative to agency explanations for the use of PRP in the
nonprofit sector. The results not only point to the ineffectiveness of PRP schemes in
housing associations but also identify the strength of institutional pressures on NPOs
to conform with best practice in pay decisions.
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