SAS Institute: Case Questions
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SAS Institute, a large and successful software firm, faced an increasingly competitive job market and , because of its ongoing growth, the need to recruit a talented work force that could help it build and maintain its intellectual capital. But, over the years, SAS Institute had developed a culture and set of practices, particularly around issues of outsourcing, recruiting, compensation, and benefits, that really differentiated it from virtually all of its competitors, particularly those in the Silicon Valley. The question facing the CEO and VP of Human Resources was simple: could and should SAS maintain its unique approach to pay and other practices? And if it did so, could it reasonably expect to continue to thrive in a world in which software talent was a scarce commodity? To answer that question, they had to consider to what extent SAS’s success had been because its management philosophy and practices, or to what extent it had succeeded in spite of those practices because of its being at the right place at the right time in the development of the software industry.
1. What is the management philosophy of SAS and how does it affect the types of human resource management practices that are used at SAS? Do you think this approach would work at a company like Microsoft?
2. How would you describe the employment system at SAS? Why doesn’t SAS use outsourced employees for menial jobs or contract workers for short-term projects, which are standard practices in the software industry?
3. SAS de-emphasizes financial compensation with its employees? Why? Don’t SAS software employees need and expect incentive compensation such as stock options to foster risk taking and innovation?
4. What is unique and different about the performance management approach used at SAS? Do you agree with this approach? How applicable is it for use in other work environments besides SAS?
5. SAS emphasizes employee benefits and work environment over financial compensation to its employees. What impact does this “benefits strategy” have on the type of workforce and its motivation at SAS? How can the most talented “star” software engineers remain motivated (let alone retained) in such an egalitarian work environment?
6. In light of the scarcity of software talent, and SAS’s future growth goals, do you think the company can continue to use its unique and contrarian Human Resource Management policies and sustain its success in the competitive software industry?