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    This document presents an integrated model of organizations' decisions about adopting flexible benefit plans. It proposes that the likelihood of adopting a new flexible benefit plan and the design adopted will be influenced by competitive pressures within an organization's industry, as well as coercive pressures from unions and legislation. Industries with higher rates of competitors already offering flexible plans will face stronger pressures to adopt similar plans. The model also suggests organizations will be more likely to match the standard or most common plan design used within their industry.

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    This document presents an integrated model of organizations' decisions about adopting flexible benefit plans. It proposes that the likelihood of adopting a new flexible benefit plan and the design adopted will be influenced by competitive pressures within an organization's industry, as well as coercive pressures from unions and legislation. Industries with higher rates of competitors already offering flexible plans will face stronger pressures to adopt similar plans. The model also suggests organizations will be more likely to match the standard or most common plan design used within their industry.

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    19 views1 page

    Is In: of PLCN To

    Uploaded by

    internasionaljawara
    This document presents an integrated model of organizations' decisions about adopting flexible benefit plans. It proposes that the likelihood of adopting a new flexible benefit plan and the design adopted will be influenced by competitive pressures within an organization's industry, as well as coercive pressures from unions and legislation. Industries with higher rates of competitors already offering flexible plans will face stronger pressures to adopt similar plans. The model also suggests organizations will be more likely to match the standard or most common plan design used within their industry.

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    of 1

    I998 Borringer crnd Milkovich

    FIGURE I
    An Integrcrted Model of Orgcnizcrtions' Decisions About Flexible Bene{it Plcns

    Lqbor
    Nature of
    mcrrket
    the work
    conditions

    Benefits
    objectives
    Coercive Iorces
    Competitors' .Iegrislcrtion
    prcrctices Cost of current
    .Unions benefits

    Employeo
    preferences

    eeted effiasemcp gmnmrs

    Orgcrnizqtioncrl Ability to Desire to


    interconnectedness resist resist

    Stoge of
    in stitutioncrlizotion

    Decisions crbout llexible benefit plcrns


    .Adoption
    .Design

    tcrin resources to compliance (Meyer & Rowqn, p/ons is high thon in indusfries in
    1977; Tolbert &. Zucker, 1996). Hence, crs the por- which the portion is Jow.
    tion of cornpetitors in an orgcrnizotion's field or Proposition lb: Orgonizqtions imple-
    industry adopting o flexible benefit plan-or o menting q new flexible benelit plon
    porticulor plcn design-increcses, the strength are likely to motch the plan design
    of the pressures to crdopt the plcn olso in-
    ,
    (e.g., core p/us opfionol coveroge or
    cresses. The pressures to odopt should be mix ond mqtch) most commonlY used
    greoter in the health core industry, for exomple, in their field or industry.
    where over two-thirds of orgcnizotions off er
    flexible benefits, thqn in mcnu{crcturing, where Antecedents of institartiCIreell pressuress Cmer-
    the incidence is lower. Similcrrly, the pressures cive forces. Institutional pressures thot ctre more
    to include c flexible spending occount in the coercive in nature mcry be generated by externql
    plan should be highest in the services industry, agents who control criticol resources qnd hav'e
    where the incidence of the occounts is highest. the power to impose preferred structures on on
    Thus, we propose the following: orgonizcrtion (DiMcrggio & Pcwell, lg83; Scc-?tt;
    Proposition lq: The rote of new flexi' l9B7; Tolbert & Zucker, 1996)- Our moCel sug-
    ble-ben ef it-pJon odopfions will be gests thot unions moy exert such pressures.
    higher in industries in which fhe Powerful unions thcrt control the supply of lobor
    portion of orgonizqtions offering the should theoreticolly be oble to influence mcn-

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