Assignment task: Gravity Payments Case Analysis
Please read the case study, Gravity Payments: Minimum Wage is a Heavy Load by Lin Tao and Tim Summers, published by Harvard Business Publishing. The case is part of our course pack from Harvard.
Questions for analysis:
1. Gravity's pay policy is unconventional. How would you expect it to influece the long-term motivation of a) a telephone sales worker, b) an executive in senior management, and c) Price himself?
2. The legal dispute between Gravity and Dan Price's brother Lucas stems from Lucas' position as a minority shareholder. How might these differences have arisen and how can they be resolved?
What pressures would other businesses feel to copy Price's pay strategy if they were (a) small and privately owned, or (b) large and listed?
Using Equity Theory as a theoretical lens, consider the reactions of an entry-level employee; then of the managers who were already being paid more than $75,000. Be sure to fully describe equity theory and how it applies to this situation.