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Social Comparison on Multiple Tasks: Sacrificing Overall Performance for Local Excellence?

Journal of Accounting Research 2024 62(4), 1309-1361 open access
ABSTRACT This field experiment investigates how different levels of aggregation in relative performance information (RPI) impact employee performance in environments with multiple tasks. We randomly assign store employees of a retail chain to three groups: RPI on overall performance (control group), RPI on separate tasks, and RPI on both overall performance and separate tasks. We do not find evidence that providing separate task RPI instead of overall RPI affects performance or effort allocation. However, providing RPI on both overall performance and separate tasks seems to reduce performance, especially in the low‐return task. This suggests that detailed RPI directs employees’ attention to the smaller benefits of low‐return tasks. We further find that only 30.5% of the employees accessed their performance reports, highlighting a distinction between providing RPI in the field and the laboratory. This study is based on a registered report accepted by the Journal of Accounting Research .

The role of target difficulty and career tournaments in retaining creative R&D employees

Contemporary Accounting Research 2024 41(2), 1058-1088 open access
Abstract We explore the turnover intentions of creative R&D employees and the role of performance management practices in shaping these considerations. Since the success of a firm's R&D efforts hinges on the innovative ideas of its employees, it is crucial to retain particularly creative individuals. At the same time, however, we argue that this is especially difficult because both the higher outside options of creative employees and their specific individual characteristics make them, on average, more likely to leave their company. Most importantly, we suggest that two widely studied performance management design choices (target difficulty and career tournaments) typically used to motivate effort may influence the loss of creative talent. Using survey data from our unique access to R&D employees of a large manufacturing firm and a complementary experiment among business students, we find evidence that creative employees are, on average, more likely to leave their firm. Consistent with creative employees possessing a stronger learning orientation, we also predict and find that this tendency to leave is mitigated by target difficulty (as difficult targets speak to creative individuals' learning orientation) and exacerbated by the intensity of career tournaments (as they reduce team cohesion and, ultimately, undermine learning opportunities).