Hedonic motivations and managers’ information choices

Abstract

Using direct measures of information acquisition from a business intelligence provider, we examine the actions managers take to learn about their business. We first provide descriptive evidence that managers of small businesses adopt the business intelligence service due to business complexity and growth expectations, and, after adoption, managers become heavy consumers of financial and related nonfinancial metrics. We then show that, despite offsetting economic motivations, the hedonic motivations of managers appear to significantly affect their information diet—i.e., managers consume information, at least in part, based on their expectation of how the information will make them feel. These findings highlight a significant friction for managers’ information processing and inform the design of pervasive data products such as dashboards.

Keywords: Hedonic motivations; information acquisition; business intelligence.

JEL Classification: M41, D83, G40