The Benefits of Deliberative Involvement in the Design of Incomplete Feedback Systems

Posted: 28 Mar 2021

See all articles by Robert Grasser

Robert Grasser

University of South Carolina

Michael Majerczyk

Georgia State University

Martin Staehle

University of Bern - Institute for Accounting

Di Yang

UNSW Business School; Georgia Institute of Technology

Multiple version iconThere are 2 versions of this paper

Date Written: March 1, 2021

Abstract

This study examines the benefits of employee involvement in feedback system design for cooperation. Understanding how to enhance cooperation is important given the increasing use of team settings in practice. Control systems often provide feedback on cooperative actions of coworkers, which can help enable cooperation in teams and between organizational units. We predict that involvement in the design of feedback systems can be a source of trust between employees and enhances cooperation. This is particularly important for dynamic environments, in which an incomplete feedback system which initially provides perfect signals of cooperation no longer does so after the environment changes. Adding to prior evidence, we find that an incomplete feedback system can benefit cooperation in a static environment, but the benefit is greater when employees were initially involved in its design. In a dynamic environment, an incomplete feedback system fails to facilitate cooperation unless employees were involved in its design. Our results identify a behavioral benefit for firms that grant decision rights to employees as part of their organizational architecture.

Keywords: cooperation, dynamic environments, feedback systems, involvement, trust

Suggested Citation

Grasser, Robert and Majerczyk, Michael and Staehle, Martin and Yang, Di, The Benefits of Deliberative Involvement in the Design of Incomplete Feedback Systems (March 1, 2021). Contemporary Accounting Research, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3798373

Robert Grasser (Contact Author)

University of South Carolina

1014 Greene St
Columbia, SC 29208
United States

Michael Majerczyk

Georgia State University ( email )

35 Broad Street
Atlanta, GA 30303-3083
United States

Martin Staehle

University of Bern - Institute for Accounting ( email )

Switzerland

Di Yang

UNSW Business School

Quadrangle Building Room 3067
Sydney, NSW 2052
Australia

Georgia Institute of Technology ( email )

Atlanta, GA 30332
United States

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