With the widespread use of narrative feedback in companies, understanding how such feedback can be valuable for employee performance improvement is important. Drawing on proprietary data from an e‐commerce company, we investigate the role of specificity and causality—two key language characteristics for self‐regulation and learning. Our findings suggest that neither specificity nor causality is always beneficial; instead, their effects depend on whether the feedback refers to strengths or weaknesses. Specifically, employees are more likely to improve when they receive more specific narrative feedback on their strengths, consistent with employees engaging in more systematic exploration when feedback provides concrete references to desirable behaviors. In contrast, we find that increases in the specificity of narrative feedback on weaknesses can have negative performance consequences, as employees who are confronted with many specific examples of undesirable behaviors may attempt too many behavioral changes at once, undermining learning and improvement. Furthermore, employees are more likely to improve when feedback on their weaknesses uses more causal language, suggesting that explanations of why certain behaviors were ineffective help employees understand and correct those behaviors. Our study informs HR leaders, supervisors, and experts responsible for designing management control systems by showing that narrative feedback should be specific when describing strengths, but more selective and richer in causal explanations when addressing weaknesses.

Previous studies on accounting innovations emphasize the key role played by innovators and other core actors in theorizing and popularizing such innovations. This paper extends this literature by drawing attention to the role of actors who occupy a more peripheral position within the innovation‐based field. We regard accounting innovations as strategic action fields, in which core and peripheral actors interact to shape the trajectory of the innovation. In contrast to core actors, peripheral actors only weakly identify with the innovation‐based field and often occupy a core position in some other industry, professional, and/or geographical field. Given their embeddedness in these other fields, they are likely to try to accommodate an innovation with existing practices. Such frame blending can be problematic for core actors who envisage a more radical frame shift. Using the case of Beyond Budgeting, we show how the interplay between core and peripheral actors shapes the trajectory of an innovation, in terms of the composition of the field and the framing tactics that dominate at different stages in the development of the field. Our paper advances a perspective on accounting innovations which highlights the variable nature of the innovation space, in terms of different actors entering and exiting this space over time, as well as the importance of considering the overlaps between an innovation‐based field and other (industry, professional, geographical) fields.

This article examines how corporate reliance on budgets is affected by major changes in the economic environment. We combine survey and archival data from the economic crisis that began in 2008. The results indicate that budgeting became more important for planning and resource allocation but less important for performance evaluation in companies affected more strongly by the 2008 economic crisis. Additional evidence from interviews and data gathered in a focus group further illustrate these results and show the changes organizations have introduced to respond to the economic crisis. Taken together, and contrary to more general conclusions from the literature such as an overall increase or decrease in the importance of budgeting, we find that companies emphasize certain budgeting functions over others during economic crises.

We examine year-to-year adjustments of performance measure weights in managers’ incentive contracts. Using survey panel data on financial middle managers over four years, we document that higher target achievement on a given measure is associated with an increase in the measure’s relative weight for the subsequent year. We explore three potential explanations for this pattern: retention considerations, managerial influence, and gradual strategic shifts. Consistent with retention considerations, we find that shifts toward better performing measures are stronger for managers who outperform their peers and in firms facing greater labor market competition. Consistent with managerial influence, we find that shifts are also stronger for managers with greater influence on their incentives and in firms with lower incentive design transparency. We find, however, no support for the gradual strategy change explanation, as results do not show that shifts vary with managers’ involvement in strategic decision-making or subsequently observed strategy changes. Data Availability: The survey data used in this project are protected by a nondisclosure agreement.