IDEAS home Printed from https://ideas.repec.org/a/taf/euract/v27y2018i2p363-382.html
   My bibliography  Save this article

Rankings, Performance, and Sabotage: The Moderating Effects of Target Setting

Author

Listed:
  • Frank Hartmann
  • Philipp Schreck

Abstract

Competitive performance rankings are widely used in organizations. Such incentive systems enable agents to improve their performance ranking not only by increasing their own performance, but also by undermining their competitors’ performance. While previous accounting studies have stressed the positive effect of ranking systems on managerial effort, the present paper investigates when such ranking systems may induce sabotage, and how this unintended effect can be mitigated. Our study is based on a laboratory experiment designed to investigate (a) whether competitive performance feedback increases an agent’s inclination to disrupt the efforts of competitors, in a case where ranking has no effect on compensation and (b) whether the presence of a self-set absolute performance target moderates these effects. Our results show that ranking increases both performance and sabotage. Adding an absolute performance standard appeared to reduce sabotage. However, when there is an absolute target, performance is higher in the absence of ranking. Overall, our results thus suggest that performance benefits from the use of either a relative or an absolute performance target, but not from their simultaneous use.

Suggested Citation

  • Frank Hartmann & Philipp Schreck, 2018. "Rankings, Performance, and Sabotage: The Moderating Effects of Target Setting," European Accounting Review, Taylor & Francis Journals, vol. 27(2), pages 363-382, March.
    • Handle: RePEc:taf:euract:v:27:y:2018:i:2:p:363-382
    DOI: 10.1080/09638180.2016.1244015
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/09638180.2016.1244015
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/09638180.2016.1244015?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Simon Piest & Philipp Schreck, 2021. "Contests and unethical behavior in organizations: a review and synthesis of the empirical literature," Management Review Quarterly, Springer, vol. 71(4), pages 679-721, October.
    2. Lisa-Marie Wibbeke & Maik Lachmann, 2020. "Psychology in management accounting and control research: an overview of the recent literature," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 31(3), pages 275-328, September.
    3. van Rinsum, M., 2019. "Utilizing Incentives and Accountability: In Control in Control?," ERIM Inaugural Address Series Research in Management EIA 2019-078-F&A, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam..
    4. Philipp Schreck, 2020. "Volume or value? How relative performance information affects task strategy and performance," Journal of Business Economics, Springer, vol. 90(5), pages 733-755, June.
    5. Petra Nieken & Anna Ressi, 2022. "Which Peer Group to Choose? The Effects of Relative Performance Information on Employee Self-Selection and Performance," CESifo Working Paper Series 9940, CESifo.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:euract:v:27:y:2018:i:2:p:363-382. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/REAR20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.