The perceived profile of goal orientation within firms: Differences between employees working for successful and unsuccessful firms employing either performance-based pay or job-based pay.

The purpose of this study was to demonstrate that the perceived profile of goal orientation within firms differs as a function of compensation system and organizational success. An examination was made of the differences between employees working for economically successful and unsuccessful firms employing either performance-based pay or job-based pay. The dependent variables were employees’ perceptions of the profile of goal orientation in their firm (performance-approach, performance-avoidance, and mastery). Survey data from 198 employees, representing 22 firms, demonstrate that performance-based pay compensation was related to employees’ perceptions of a performance orientation in their firm, both approach-oriented and avoidance-oriented. Employees working for successful firms that employed performance-based pay, however, perceived a relatively strong performance-approach orientation in their firms, whereas their counterparts working for unsuccessful firms perceived a relatively high performance-avoidance orientation. Furthermore, the findings show that successful firms employing either performance-based pay or job-based pay were predominantly mastery-oriented