Issue link: http://www.e-digitaleditions.com/i/55878
that were to be returned at the end of the study. "If you pay people contingent on their perfor- mance, you have motivated them to perform," McLean Parks says. However, if they are unable to perform well because the task is too hard or the economy is poor or some other condi- tions apply, "you have also given them an incentive to cook the books!" The study may explain some of the financial dif- ficulties companies are experiencing today. "For years we have touted the basic mantra of 'pay for performance' because that's the way you get the best performance," observes McLean Parks. "Maybe you get the best performance reported, but what's the underlying performance?" More details can be found at www.olin.wustl. edu/docs/Faculty/McLean ParksOlinAward.pdf. 2009 Olin Award Winner A Theory of Strategic Problem Formula- tion, by Markus Baer, Kurt Dirks, and Jackson A. Nickerson, all of Wash- ington University Teams and task forces are usually formed to solve a problem—but 75 percent of the time, they solve the wrong one. In this paper, Baer, Dirks, and Nicker- son identify three common traps that teams experi- ence in problem formula- tion. They also present an eight-step process that allows teams to systemati- cally enhance their strate- gic problem formulation capabilities. Details can be found at www.olin.wustl.edu/docs/ Faculty/StrategicProblem Formulation.pdf. 2008 Olin Award Winner Envy, Comparison Costs and the Economic Theory of the Firm by Jackson Nickerson and Todd R. Zenger, both of Washington University Nickerson and Zenger argue that organizations are destined to fail if pay incentives such as bonuses, retention fees, and perfor- mance-based salaries are provide the authors written feedback on their papers. Kitt- ner believes this will be beneficial as professors think about future submissions. It's clear that the competition has encouraged faculty to view their research projects from a wholly new perspective. "In the three years since the award was initiated," says Mahoney, "I have had a number of young faculty ask me whether their work is of importance to the business community rather than only the academic journals. That's a real measure of progress." "We all think our research is relevant," says Todd Zenger, Robert & Barbara Frick professor of business strategy and a winner of the first Olin Award. But a competition such as this one encourages faculty to consider its real-world implica- tions by reminding them of "the ultimate marketplace" for their scholarly endeavors, he says. Jackson Nickerson agrees. The Frahm Family Professor of Organization and Strategy—and co-author of two win- ning papers—believes the competition encourages scholars to undertake research that is both rigorous and relevant. "I not properly managed. "People make 'social comparisons' with their fel- low employees regarding compensation, and that creates costs in organiza- tions," Zenger explains. The costs include negativ- ity and demands for equal incentives, which ultimately can lead to a dysfunction- al organization, Zenger says. Private and public man- agers need to acknowl- edge and deal with the role envy plays in firms across all industries from banking to the automo- tive field, says Nickerson. "Understanding this basic business principle is important for government regulators and legisla- tors who are structuring compensation for any industry." More details are avail- able at apps.olin.wustl. edu/faculty/nickerson/ envy.pdf. think it is this translation to relevance that is the real discon- nect between academia and business," says Nickerson. Schools interested in launching similar competitions would do well to gain the backing of a key benefactor as a first step, says Gupta. "Dick Mahoney's support and encour- agement have been absolutely crucial to the success of this project," the dean says. "While he is affiliated with the busi- ness school, he still represents the business world as a former CEO. His qualifications and stature make him an ideal link between the worlds of scholar and executive." An internal competition motivates faculty to consider how their scholarly endeavors might be viewed by the external world, where relevance is just as important as rigor. At a time when many schools are focused on aligning their faculty research with their missions, such a competition also keeps everyone working toward the same goals—and striving for real prizes. ■ z Melody Walker is director of news and information at the Olin Business School of Washington University in St. Louis, Missouri. BizEd JULY/AUGUST 2010 37