The Impact of Incentive Systems in Global Organizations Located in Sweden -A Case Study of Astra Zeneca

Abstract

Background and The main purpose of an incentive system is to affect the behavior of those who Problem: should be rewarded and thus guide them to work towards common goals. There has been negative publicity regarding incentive systems in Sweden, but despite this it is used by many Swedish companies. The incentive system is derived from the Agency theory, and since Sweden has a long tradition of Stewardship leadership it is interesting to study its role in a Swedish company. This theoretical clash might create problems. Research Question: How is the behavior of the employees in a Swedish environment affected by the incentive system? Purpose: The main purpose is to understand the role of incentive systems in global organizations located in Sweden. Method: We have performed a qualitative case study, based on 16 interviews at four different departments at AstraZeneca. Conclusion: We found that a bonus system derived from Agency theory does not affect a Stewardship environment significantly. Further, when a bonus system does not work in line with theory there are other contributions to an organization. This indicates that a bonus system after all can be appreciated but to fit the Stewardship environment it must be adjusted. Further Research: Suggestions for further research is to repeat the case study at other organizations to see if our findings are consistent. We also suggest a larger number of respondents to further increase the understanding of how the employee behavior is affected.