Motivation of company's top managers during implementation of an innovational project: financial and non-financial constituents
by Viktor P. Kuznetsov; Sergey N. Yashin; Egor V. Koshelev; Dmitry V. Podshibyakin; Anastasia O. Egorova
International Journal of Trade and Global Markets (IJTGM), Vol. 10, No. 2/3, 2017

Abstract: The matter of a top manager's motivation is adapted to the consumer behaviour theory. The problem of bringing a non-financial motivation to a financial one may be solved with a certain error. This problem may be overcome by introducing a special metric of utility functions. For that end, the problem has been transferred to a space consisting of utility functions. The problem solution turns out to be a circle with a center at the reference point. It has been established that the financial resources allocated by a company for motivation are presentable in a graphical format by means of a line similar to the budget line reviewed in the consumer behavior theory. The obtained results are used to define a motivational optimum by analogy with the consumer optimum that is already well-known in the economic science. For an innovative project implemented in a company, an optimal value of net present value (NPV) is produced resulting in structuring an efficient motivation system for a top manager who becomes a 'friend' to the company in this case. It has been proven that the desired equilibrium value of NPV is in direct relationship to the bonus fund owned by the company.

Online publication date: Tue, 22-Aug-2017

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