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2024/2025  KAN-CCMVV2450U  Designing Organizations: People, Incentives, and Structure

English Title
Designing Organizations: People, Incentives, and Structure

Course information

Language English
Course ECTS 7.5 ECTS
Type Elective
Level Full Degree Master
Duration One Quarter
Start time of the course Second Quarter
Timetable Course schedule will be posted at calendar.cbs.dk
Study board
Study Board for cand.merc. and GMA (CM)
Course coordinator
  • Julia Bodner - Department of Strategy and Innovation (SI)
Main academic disciplines
  • Human resource management
  • Organisation
  • Strategy
Teaching methods
  • Face-to-face teaching
Last updated on 13-02-2024

Relevant links

Learning objectives
At the end of the course, students should be able to:
  • Demonstrate knowledge and understanding of core concepts and theories related to employee selection and retention, incentives, and the allocation of decision rights within organizations’ structures as building blocks of strategy implementation.
  • Apply core concepts and theories to real-world cases, enabling them to predict and understand responses to (changes in) people practices, incentives, decision rights, and organizational structures.
  • Evaluate benefits and potential pitfalls of implementing common people practices and forms of incentives and organizational structures.
  • Recognize the interdependences between people practices, incentives, and organizational structures in influencing employee motivation and desired behaviors, such as initiative, prosocial behavior, coordination, cooperation, and trust.
  • Explain the role of big data and analytics in people practices, incentives, and organization design, recognize its potential to analyse and predict employee behavior, and embrace and detect sources of ambiguity in such analyses.
Designing Organizations: People, Incentives, and Structure:
Exam ECTS 7,5
Examination form Home assignment - written product
Individual or group exam Individual exam
Size of written product Max. 15 pages
Assignment type Written assignment
Release of assignment An assigned subject is released in class
Duration Written product to be submitted on specified date and time.
Grading scale 7-point grading scale
Examiner(s) One internal examiner
Exam period Winter
Make-up exam/re-exam
Same examination form as the ordinary exam
If the student fails the ordinary exam the course coordinator chooses whether the student will have to hand in a revised product for the re-take exam or a new project.
Course content, structure and pedagogical approach

This course is about how organizations can be designed to motivate, enable, attract, and retain people to pursue their strategic organizational goals, which can be economic, environmental, or societal in nature. The main goal is to equip students to support the implementation of set strategic goals in their future workplaces and responsibilities.


Incentives and decision rights are core elements of strategy implementation. Organizations need to encourage value-creating behavior and discourage value-destroying behavior to accomplish their strategic goals. To do so, it is important that organizations select and retain the right people, provide the right incentives, and organize their structure accordingly. However, these choices are often challenging: If we change the design of an organization, its incentive systems, or its decision rights, we will change how people in the organization act. These changes often have surprising and unintended effects.


In this course, we will draw on cutting edge research and core theoretical concepts from a variety of fields for students to better understand responses to common forms of incentives and organization designs and their alignment with strategy—such as organizational economics, organizational behavior, and strategy.


Who should take this course? This course should be taken by anyone who expects to have to think about people practices, incentives, and organization design and their consequences to implement organizations’ strategies and their economic, environmental, and societal goals—be it to manage a firm as a manager or when founding one’s own company, advise a firm as a strategy consultant, or redesign and evaluate firms and their business strategies. 

Description of the teaching methods
By combining case studies and guest lectures with cutting-edge research insights, class sessions focus on connecting core theoretical concepts to real-world examples. Through discussion, cases, and simulation exercises, students learn to recognize possible pitfalls of incentives and organization design choices in practice, and potential ways to avoid them. Cases are selected to reflect recent and ongoing trends and expose students to a variety of types of organizations and industries.
Students are guided in their preparation for each session based on a short list of questions, allowing them to focus on a few core takeaways. Pre-class preparation consists of videos, podcasts, and articles.
Feedback during the teaching period
Feedback will be given as we discuss the cases and readings. Polls and multiple-choice questions will be used to also prompt discussions and enable feedback and encourage students to integrate reflections of their own experiences. Discussions are structured and accompanied to encourage students to collaborate in groups and exchange constructive feedback. Finally, students can also stop by to get feedback and ask questions during office hours.
Student workload
Teaching 30 hours
Preparation 100 hours
Exam 76 hours
Further Information

The Nordic Nine

The course aligns with the Nordic Nine framework, providing students an understanding of and ability to apply key concepts and theories broadly relevant to organizations (#1 “You have deep business knowledge placed in a broad context”). It employs a case-based approach, emphasizing group and class discussions for collaborative learning (#6 “You are critical when thinking and constructive when collaborating” and #8 “You grow by relearning and by teaching others to do the same”). Students engage in decision-making scenarios to reflect on business competitiveness while considering their societal impact and effects on employees and other stakeholders (#4 “You are competetive in business and compasisonate in society”). The curriculum explores the use of people analytics for analytical insights into employee behavior and addresses related ethical dilemmas (#2 “You are analytical with data and curious about ambiguity” and #5 “You understand ethical dilemmas and have the leadership values to overcome them”).

Expected literature

Expected literature

The reading list below is only meant to give an idea about the discussed topics—it includes research that will be discussed but is not compulsory for students to read.


Lazear, E. P. (2000). Performance pay and productivity. American Economic Review90(5), 1346-1361.


Friebel, G., Heinz, M., Krueger, M., & Zubanov, N. (2017). Team incentives and performance: Evidence from a retail chain. American Economic Review, 107(8), 2168-2203.


Obloj, T., & Sengul, M. (2012). Incentive life-cycles: Learning and the division of value in firms. Administrative Science Quarterly, 57(2), 305-347.


Dahl, M. S., & Pierce, L. (2020). Pay-for-performance and employee mental health: Large sample evidence using employee prescription drug usage. Academy of Management Discoveries, 6(1), 12-38.


Bennedsen, M., Simintzi, E., Tsoutsoura, M., & Wolfenzon, D. (2022). Do firms respond to gender pay gap transparency?. The Journal of Finance77(4), 2051-2091.


Huckman, R. & Pisano, G.P. (2006). Firm specificity of individual performance: Evidence from cardiac surgery. Management Science, 52(4): 473-488.


Burks, S. V., Cowgill, B., Hoffman, M., & Housman, M. (2015). The value of hiring through employee referrals. The Quarterly Journal of Economics, 130(2), 805-839.


Anderson, T., & Bidwell, M. (2019). Outside insiders: Understanding the role of contracting in the careers of managerial workers. Organization Science30(5), 1000-1029.


Won, S., & Bidwell, M. (2023). Finding the right path to the top: How past interorganizational moves impact executive selection outcomes. Strategic Management Journal.


Choudhury, P., Khanna, T., & Sevcenko, V. (2023). Firm-induced migration paths and strategic human-capital outcomes. Management Science69(1), 419-445.


Bloom, N., Liang, J., Roberts, J., & Ying, Z. J. (2015). Does working from home work? Evidence from a Chinese experiment. The Quarterly Journal of Economics130(1), 165-218. 


Mas, A., & Pallais, A. (2017). Valuing alternative work arrangements. American Economic Review, 107(12), 3722- 59.


Choudhury, P., Foroughi, C., & Larson, B. (2021). Work‐from‐anywhere: The productivity effects of geographic flexibility. Strategic Management Journal42(4), 655-683.


Bode, C., Singh, J., & Rogan, M. (2015). Corporate social initiatives and employee retention. Organization Science26(6), 1702-1720.


Hussain, I., Pitesa, M., Thau, S., & Schaerer, M. (2023). Pay suppression in social impact contexts: How framing work around the greater good inhibits job candidate compensation cemands. Organization Science.


Edmondson, A. C. (2018). The fearless organization: Creating psychological safety in the workplace for learning, innovation, and growth. John Wiley & Sons.


Edmondson, A. C., & Bransby, D. P. (2023). Psychological safety comes of age: Observed themes in an established literature. Annual Review of Organizational Psychology and Organizational Behavior10, 55-78.


Alexy, O., Poetz, K., Puranam, P., & Reitzig, M. (2021). Adaptation or persistence? Emergence and revision of organization designs in new ventures. Organization Science32(6), 1439-1472.


Bodner, J., & Capron, L. (2018). Post-merger integration. Journal of Organization Design7, 1-20.


Kim, J. D. (2022). Startup acquisitions, relocation, and employee entrepreneurship. Strategic Management Journal43(11), 2189-2216.


Dietvorst, B. J., Simmons, J. P., & Massey, C. (2018). Overcoming algorithm aversion: People will use imperfect algorithms if they can (even slightly) modify them. Management Science64(3), 1155-1170. 


Last updated on 13-02-2024