Controversial Retention Bonuses at Aig

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Running Head: Chapter 5 Case Study: Controversial Retention Bonuses at AIG Chapter 5 Case Study: Controversial Retention Bonuses at AIG R. Walker, C. Sutton & E. Dozier MBA 530 Organizational Behavior Chapter 5 Case Study: Controversial Retention Bonuses at AIG Chapter 5 Case Study: Controversial Retention Bonuses at AIG Discussion Questions 1 thru 6 on page 180 Question #3. Using the model of the individual-organizational exchange relationship, explain the relationship that employees of AIG’s Financial Products unit believed they had with the company. How was this exchange relationship violated? In considering the individual-organizational model, employees of AIG’s Financial Products unit believed they had an equitable professional relationship with AIG based on expressed and implied expectations and demands placed on each other. More specifically, the employees understood their relationship with their organization as a demand for them to understand AIG’s organizational goals or mission statements, job expectations, performance objectives, and performance feedback. Once the organization’s demands were understood and mastered by employees. They could expect to be satisfied through benefits, status in the company, and/or more income for meeting these demands and expectations in the organization. This made for a mutually sociable exchange of demands and contributions between the individuals and the organization. According to the authors, “Equity Theory is a social exchange process theory of motivation that focuses on individual-environment interaction” (Nelson, Quick, 2011, p.165). Equity Theory concerns itself with understanding the social processes that effect motivation and behavior in individuals and their environment. When it involves individual-organization relationships, Amitai Etzioni is an authority

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