Incentives:

Clark and Wilson (1961) differentiate between three types of incentives:

Material incentives: tangible rewards often monetary -- wages, fringe benefits, patronage

Solidary incentives: intangible rewards from the act of association -- sociability, status, identification

Purposive incentives: intangible rewards related to the goals of the organization --- e.g., working on an election of a supported candidate


Utilitarian organizations rely primarily on material incentives (business firms, labor unions, political machines). Clark and Wilson predict they will have fairly precise-cost accounting machinery (Scott p. 172). Managers will focus on obtaining necessary material incentives, conflicts will be about distribution. Organizational goals will be secondary to incentives.

Solidary organizations (service-oriented voluntary organizations and social clubs) are places where people make contributions in return for sociability and status (Scott p. 173). Executive efforts are at securing prestige, publicity, or good fellowship. The organizational goals are non-controversial and socially acceptable. These organizations tend to be less flexible and more public in actions and decisions.

Purposive organizations rely on their stated goals to attract and retain people (Clark and Wilson, 1961). Executives need to maintain inducements, but when goals are lofty this is difficult to sustain. Often their efforts fail initially or intermittently (don't elect candidate, don't stop hunger, etc.). Sometimes the goals are too vague or only support a minority of interests.

Selective Incentives

Selective incentives in organizational membership derive from the perceived benefits of inclusion in an "elite" group. Organizations from symphonies to top-tier business schools use selective incentives to build loyal membership and support. For individuals, belonging to an exclusive group like the symphony can bring satisfaction through the status and social contacts it confers (Clark and Wilson in Scott p. 172). Corporations may gain special access to professors and students through their membership in industrial affiliate programs.

The impact of these subtle reward systems are interesting to natural system theorists like Barnard, Simon and Olsen (Scott p. 171). Barnard emphasized the need for various incentives in organizations to maintain member contributions (p.171). Simon added that incentives and contributions are interdependent and require a certain equilibrium for organizational survival (p.171). Often monetary incentives are only partially effective to secure contributions -- perceived exclusivity of membership can be an important natural system strategy.