Relative performance information, rank ordering and employee performance: A research note
Management Accounting Research , Volume 33 p. 16- 24
We conduct a laboratory experiment to examine whether the provision of detailed relative performance information (i.e., information about the specific performance levels of peers) affects employee performance. We also investigate how - if at all - explicit ranking of performance levels affects how employees respond to relative performance information. Our hypotheses are developed based on insights about social comparisons and status incentives from the psychology and behavioral economics literature. The results of the experiment show that the provision of relative performance information increases employee performance, yet we find no additional effects of rank ordering. Specifically, average performance levels are similar in conditions in which relative performance figures are presented in random order, in best-to-worst order and in worst-to-best order.
|Experiment, Performance, Ranking, Relative performance information, Social comparison, Status incentives|
|ERIM Top-Core Articles|
|Management Accounting Research|
|Organisation||Rotterdam School of Management (RSM), Erasmus University|
Kramer, S, Maas, V.S, & van Rinsum, M. (2016). Relative performance information, rank ordering and employee performance: A research note. Management Accounting Research, 33, 16–24. doi:10.1016/j.mar.2016.03.004