Management

Should Employees Choose Their Tasks?

ilseu — Mon, 12 Apr 2021 20:15:20 +0000

Should Employees Choose Their Tasks? ilseu Mon, 04/12/2021 - 13:15 More News Holly Ober April 12, 2021

Letting employees select their own tasks is a popular means of increasing work satisfaction. However, managers should also consider the nature of the task and the employees’ specialization before letting them select their own, suggests a new study led by UC Riverside and published in Organization Science.

Traditionally, managers allocate tasks to employees who are expected to produce a defined output. As organizations must increasingly respond to markets and opportunities quickly and decisively, they have begun to experiment with letting employees choose their own tasks. There is to date little hard data, however, to help managers determine the best task-allocation strategy to optimize worker productivity and satisfaction, and the organization’s success.

Marlo Raveendran

Marlo Raveendran, an assistant professor of management in UC Riverside’s School of Business and the A. Gary Anderson Graduate School of Management, led an international team of researchers who studied when and why self-selection may outperform allocation of work by a manager within an organization. They found that manager-led allocation tends to perform better than self-selection when employees have a broad skill range, tasks are highly interdependent, and coordination requirements are high. Self-selection tends to perform better than managerial allocation when employees are highly specialized, tasks are fairly independent and when new workers join a firm or project over time.

“We tend to think of the upside of self-selection as providing greater motivation for employees and better information on their own skills,” Raveendran said. “However, we found that even in the absence of motivational and informational considerations, self-selection can outperform managerial allocation depending on the employees’ degree of specialization and the nature of work.”

The researchers developed an agent-based model to see whether self-selection may have performance benefits over managerial allocation even in the absence of heightened job satisfaction. The model showed the skill-to-task fit tends to be higher under self-selection than under managerial allocation, but at the cost of over- and under-staffing of tasks. In self-selection, employees often pick their tasks without considering other employees’ skills, while managers may give away a task to an employee today for which a better-skilled employee may come along later.

The trade-off between self-selection and managerial allocation rests on a trade-off between interpersonal coordination failure under self-selection and intertemporal coordination failure under managerial allocation. This trade-off exists in addition to motivational and skill or information advantages that usually benefit self-selection.

“We provide a deeper understanding of the mechanism underlying the relative performance differences between self-selection and managerial allocation of employees to tasks that goes well beyond the expected motivational and informational advantages that intuitively characterize self-selection,” Raveendran said. “The results of our analysis offer a window into the conditions under which each form of intraorganizational division of labor may have relative advantages.”

The research adds rigor to the question of when to use self-selection as a form of task allocation within organizations. Managerial allocation has many coordination advantages, but self-selection likely outperforms it under a confluence of specific conditions: When employees are very skilled but at only a narrow range of tasks, tasks are independent, and employee availability is unforeseeable.

The researchers hope these results can be used to inform, if not guide, managerial thinking on when and how to use self-selection as an allocation process within the firm.

Raveendran was joined in the research by Phanish Puranam of INSEAD in Singapore and Massimo Warglien at Ca’ Foscari University of Venice in Italy. The paper, “Division of labor through self-selection,” is available.

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Banner image by Gerd Altmann from Pixabay

Strategic Decisions Driving Mergers, Acquisitions

ilseu — Mon, 29 Mar 2021 06:24:54 +0000

Strategic Decisions Driving Mergers, Acquisitions ilseu Sun, 03/28/2021 - 23:24 More News Laurie McLaughlin March 30, 2021

Professor of Management Jerayr “John” Haleblian earned both his bachelor’s and master’s degrees in psychology before earning a Ph.D. in business. During his academic career, he’s found that the two disciplines marry well within his teaching and research.

“Training in psychology helped me better understand how organizational actors can influence strategic decisions,” says Haleblian, whose research interests include mergers and acquisitions, organizational learning, and strategic leadership. “I have often used that lens to explore how decisions are made and their influence on firm outcomes.”

Haleblian is a widely published acquisitions scholar, associate dean of faculty, department chair at UC Riverside’s School of Business, and was named Anderson Presidential Chair in Business Administration last year. “The Anderson family has been the most generous donor to the school,” he says. “It’s always an honor when your colleagues consider your research accomplishments to be worthy of a chair, the highest research distinction a university can confer.”

Currently, Haleblian’s research looks at how board composition affects a company’s sale: “From the perspective of the firm being bought, their board of directors can have a positive impact on value achieved for target shareholders,” he says of his findings. “Specifically, target boards that meet more often and comprise some female board members, board members that serve only on one board, and board members who have acquisition experience, tend to enhance target firm performance.”

His previous research includes co-authored studies published in Administrative Science Quarterly, Academy of Management Journal, Strategic Management Journal, Organization Science, and the Harvard Business Review, among many other publications. His work has also appeared in The New York Times, The Economist, and Businessweek.

Having earned his doctoral degree at University of Southern California, Haleblian joined UCR’s business faculty in 1995. From 2011 to 2014, he taught at the University of Georgia and then returned to UCR, where he appreciates the diversity of the students he teaches. “Many are first-generation college students, and it’s rewarding to teach young minds and help them on their path to improving their social mobility,” he says.

Within his classroom, his research helps students understand the mutable nature of the business world and the avenues successful corporate leadership must navigate. “Strategic management is an inherently interesting topic because it’s not always clear why some firms perform better than others,” says Haleblian. With a nod to his background in psychology, he adds, “Business is also a great context to assess individual decision processes.”

Trust the Power of Markets

edraws — Fri, 09 Oct 2020 17:17:39 +0000

Trust the Power of Markets edraws Fri, 10/09/2020 - 10:17 More News Holly Ober September 25, 2020

Organizations that use ad hoc groups or committees to make decisions might do better to crowdsource their decisions, says UC Riverside-led research.

The study found that people trust groups even though they are susceptible to manipulation and can make poor decisions. Information markets, in which people bet on potential outcomes, tend to make more accurate decisions, but people trust them less. Once people get used to using markets, however, they trust them more, making markets a useful decision-making tool for large organizations.

Boris Maciejovsky

“Our key finding was that transparency and trust are why people prefer groups even though markets outperform them,” said first author Boris Maciejovsky, an associate professor of management in UC Riverside’s School of Business. “People are skeptical of algorithms. Markets will be used less until people get used to them.”

The research raises additional questions for future research about the productivity of working from home during COVID-19 pandemic. The fact that people have less trust in computer-mediated markets than in face-to-face interactions might lead to a reduction in communication efficiency and thus potentially work performance while working remotely.

Information markets work like a game. People place bets on predicted outcomes in an online forum. Familiar types of prediction markets include those for the Oscars or elections. Markets, for example, often do better than exit polls at predicting the outcome of elections. Markets make accurate predictions by pooling and aggregating the diverse beliefs of many participants.

Groups and committees, by contrast, are typically smaller and therefore contain more homogenous knowledge and information. Groups are also easier to manipulate. Conflicts among members, misalignment of organizational and individual goals, and persuasive negotiation or voting can all lead to poor decisions.

In large companies or organizations that use information markets, all employees are typically given the same amount of money and place odds-based bets on the potential outcomes of a situation or strategy in an online forum that everyone can see. Markets receive truthful information by asking participants to “put their money where their mouth is,” and do not require alignment of organizational and personal goals. People who bet on the winning outcome get paid, giving an incentive to participate in the market. As in any betting situation, both correct and incorrect decisions have financial consequences.

Given their decision-making success, Maciejovsky and co-author David Budescu, a psychology professor at Fordham University, wondered why information markets are not used more widely by large organizations, which usually prefer groups and committees.

The first experiment had college students select a candidate for a managerial position in either a face-to-face group or an online market. Each category had the same information about the candidate. Group participants were given various roles and financial incentives, which were manipulated by the researchers in different ways. Market participants were manipulated with various financial incentives. Control groups and markets were not manipulated.

The results showed that groups outperform markets when the members share incentives and interests. However, markets outperform groups when conflicts of interest exist among members. Interestingly, people overlooked or failed to notice the detrimental effect of conflict within groups and put more trust on groups than markets.

Participants in the next experiment were either asked to watch a video of three people discussing job candidates or to watch market trading on a screen. Half the participants in the video cohort were told about conflicts of interest some of the candidates had. The market cohort was told that they could infer the merits of the candidates by observing market activity. Afterward, all participants were asked to evaluate their group or market on a number of attributes including transparency, benevolence, efficiency, familiarity, fairness, integrity, and predictability. The results confirmed the findings of the first study: People perceive groups to be more transparent, fair, and honest than markets.

To find out why people trust groups in spite of the demonstrably bad effects of intragroup conflicts, the third experiment recruited people who worked for a large forecasting project that sometimes uses information markets to make predictions and sometimes relies on teams or individual predictions. The forecasters from this project participated in a replication of the second study described above. The results showed a halo effect—everyone trusted the institution with which they were most familiar, which was committees. However, the more experience people had using information markets, the more they trusted them.

“It’s hard at first to trust abstract mechanisms like markets,” Maciejovsky said. “But our research shows that markets are reliable and less susceptible to bias. Large organizations could benefit from using information markets.”

The research also hints at an unexpected potential outcome of the COVID-19 pandemic, where working from home has made in-person meetings impossible.

“Perhaps as people become more comfortable making business decisions in an environment of decreased interpersonal contact and increased reliance on technology decision markets will be seen as less threatening and find wider use in American organizations,” Maciejovsky said.

The paper, “Too much trust in group decisions: uncovering hidden profiles by groups and markets,” is published in Organization Science.

Header photo by Christina @ wocintechchat.com on Unsplash