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Managing People - How Employees' Social Preferences Shape the Returns to Management Practices

Project description

How management practices can lead to better outcomes

Overall management practices are closely linked to the productivity and performance of a company as well as workers’ benefits (both monetary and non-monetary). The EU-funded MANAGING PEOPLE project will study the causal effects of management practices and to what extent employee social preferences shape the returns of those practices. Specifically, the project will assess the effects of management practices on multiple outcomes such as sales and turnover. It will carry out an experiment in a firm comparing the effects of a bonus system in which bonuses are allocated equally, and one in which this is at the discretion of the manager. In another experiment, randomly selected workers from different departments meet and discuss planning errors.

Objective

Many management practices incur important consequences for the distribution of resources as well as for workers' monetary and non-monetary benefits. It is therefore likely that employees' social preferences - like reciprocity, fairness concerns - matter for the effectiveness of management practices and play a major role in the productivity of firms. I analyze the causal effects of management practices and study to what extent employees' social preferences shape the returns of the considered management practices. In RCTs, I randomize management practices within firms to identify their effects on multiple outcomes, e.g. sales and turnover. I then collect survey data on employees' social preferences and managers' beliefs to study how social preferences shape the returns of the management practices. PROJECT A: In a bakery chain with a control-oriented culture, I reduce for a randomly selected half of the 150 stores documentation duties that workers perceive as a sign of distrust. I examine the causal impact of employee control on performance and study whether the effects interact with workers' reciprocity. PROJECT B: In a random sample of 234 grocery stores, bonuses are allocated equally among workers. In the remaining stores, managers have full discretion regarding the bonus allocation. I study whether managers' discretion causally affects performance and examine to what extent the effect is associated with employees' fairness perceptions and managers' beliefs about workers' distributional preferences. PROJECT C: In a kitchen manufacturer, 301 workers employed in various units whose task it is to identify kitchen planning errors do not interact and share knowledge. I introduce a new component into the organizational structure: regular meetings in which randomly selected workers from different units discuss planning errors. I study the causal impact of the meetings on performance and trust between workers, and examine whether the effects depend on workers' reciprocity.

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Keywords

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Programme(s)

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Topic(s)

Calls for proposals are divided into topics. A topic defines a specific subject or area for which applicants can submit proposals. The description of a topic comprises its specific scope and the expected impact of the funded project.

Funding Scheme

Funding scheme (or “Type of Action”) inside a programme with common features. It specifies: the scope of what is funded; the reimbursement rate; specific evaluation criteria to qualify for funding; and the use of simplified forms of costs like lump sums.

HORIZON-ERC - HORIZON ERC Grants

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Call for proposal

Procedure for inviting applicants to submit project proposals, with the aim of receiving EU funding.

(opens in new window) ERC-2021-STG

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Host institution

UNIVERSITAT ZU KOLN
Net EU contribution

Net EU financial contribution. The sum of money that the participant receives, deducted by the EU contribution to its linked third party. It considers the distribution of the EU financial contribution between direct beneficiaries of the project and other types of participants, like third-party participants.

€ 1 445 535,00
Address
ALBERTUS MAGNUS PLATZ
50931 KOLN
Germany

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Region
Nordrhein-Westfalen Köln Köln, Kreisfreie Stadt
Activity type
Higher or Secondary Education Establishments
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Total cost

The total costs incurred by this organisation to participate in the project, including direct and indirect costs. This amount is a subset of the overall project budget.

€ 1 445 535,00

Beneficiaries (1)

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