We’ve all been compared to others whether in our personal, school or professional life. Growing up we compare ourselves to siblings or friends, at school we compare grades on an exam, and in our careers we compare our performance to that of our co-workers. New research from faculty at the Daniels College of Business provides insights into what happens when employers provide feedback that allows employees to compare how well they’re doing relative to other employees.
In a recent research project published in the Journal of Management Accounting Research, School of Accountancy Assistant Professor Nate Waddoups conducted an experiment to see how employees responded to competitive feedback.
In his experiment, he provided one group of employees with competitive feedback that compared them to their peers, and the other group of employees with individual feedback that contained no comparison information. Waddoups and his co-authors found both a benefit and a cost to the competitive feedback.
The employees who received competitive feedback worked harder on the initial task. They wanted to look good compared to their peers so they put in extra effort. This represents a benefit that firms can use to get their employees to work harder.
However, there was a cost. On a subsequent, unrelated task, those employees who received competitive feedback and were told that they were top performers were significantly less likely to help out their co-workers. The most surprising thing was that these were not even the same co-workers they were competing with in the initial task. These were complete strangers, but the competitive mindset seemed to spill over into other areas.
Overall, the message is that deciding what type of feedback to provide to your employees can be complex. On the one hand, competitive feedback can help employees be more motivated. On the other, it can also spill over into other areas and make employees less likely to help out.
This research article, “Performance Feedback Type and Employees Subsequent Willingness to Help Other Employees,” was co-authored with University of South Carolina Associate Professor Andrew Newman, Assistant Professor Bryan Stikeleather and PhD candidate Paul Black.
Waddoups joined the School of Accountancy faculty in Sept. 2018. He teaches introductory managerial accounting and his research focuses on economics, judgement and decision-making, and how management controls impact employee behavior.