Adam Presslee

We develop a methodological guide to improve the efficiency of effort-intensive tasks. Although the central role that theory plays when designing effort-intensive tasks is understood at a conceptual level, how to translate that understanding into concrete experimental design choices is often challenging. We highlight eight factors that researchers should consider when designing effort-intensive tasks: (1) task attractiveness, (2) task importance, (3) task complexity, (4) alternate task strategies, (5) unit of performance, (6) within-round task experiences across participants, (7) trends over time, and (8) task difficulty across rounds. Then, using the effects of incentive pay on effort intensity as an illustrative example, we offer a practical application of our guide via an experiment with three popular effort-intensive tasks: the decode, letter search, and slider tasks. Data Availability: Data are available on request. JEL Classifications: C91; M41; M52.

Targets are a central component of management control systems and are widely used to direct employee attention and motivate their effort. Accounting research has largely validated the performance-enhancing effects of targets, especially when linked with rewards. However, unique and dynamic institutional features differentiate accounting settings from those examined elsewhere. In this introduction, we introduce the articles appearing in the Journal of Management Accounting Research special forum on target setting in management accounting. We then highlight five promising directions for future accounting research: (1) target pursuit in teams, (2) remote and AI-supported target setting, (3) targets and affect, (4) neurophysiological research on targets as goals, and (5) field experiments on targets. Together, we hope this article can inspire future research aimed at advancing theory and informing practice around targets.

Firms commonly employ leaderboards within their peer-to-peer recognition programs. We experimentally investigate how ranking basis—variation in the measure firms use to determine leaderboard rankings—affects employees’ proactive helping behavior. We find that leaderboards ranking employees based on the number of times peer-to-peer recognition is received decrease proactive helping compared with when no leaderboard is provided. Conversely, leaderboards ranking employees based on the number of times peer-to-peer recognition is given increase proactive helping compared with when no leaderboard is provided. These findings underscore the influence of ranking basis on shaping motives linked to proactive helping behavior. Furthermore, these findings highlight for firms the importance of judiciously selecting a ranking basis when utilizing peer-to-peer recognition leaderboards. JEL Classifications: C92; D91; M41; M54.

Performance-contingent cash and tangible rewards are commonly used to motivate employees, and the taxation of such rewards is unavoidable. We use two experiments to examine how the effect of reward taxation on employee effort varies by reward type. In Experiment 1, we find reward taxation decreases positive affect, increases negative affect, and decreases reward attractiveness for employees when rewards are tangible, but not when rewards are cash. In Experiment 2, we find reward taxation reduces employee effort when rewards are tangible, but not when rewards are cash. Collectively, this evidence advances knowledge at the intersection of tax and management accounting by explaining why reward type alters the effect of reward taxation on employee effort. Moreover, our experimental results inform managers of a potential downside to using tangible rewards to motivate employees. Data Availability: Authors will make data available on request. JEL Classifications: J41; M11; M52; M55.

Variation in functional expertise is an important decision that managers face when designing teams tasked with being creative. We develop theory that predicts that functional diversity has countervailing effects on team creativity through its positive (negative) effect on the uniqueness (usefulness) of the proposals generated. We conduct an experiment where functionally homogeneous or heterogeneous two-person teams are tasked with proposing a creative use for an unused university space. We measure the uniqueness, usefulness, and overall creativity of team proposals. We also use functional near-infrared spectroscopy (fNIRS) neuroimaging technology to investigate the underlying team cognitive processes. Measured outcomes and fNIRS data support our predictions. Combining conventional experiment and advanced neuroimaging techniques, our study informs theory and practice by providing evidence of how functional diversity affects team creativity. This paper was accepted by Suraj Srinivasan, accounting. Funding: This work was supported by the National Natural Science Foundation of China (NA) [Grant 72172132] and CPA Ontario’s Centre for Sustainability Reporting and Performance Management (NA). Supplemental Material: The online supplemental appendix and data files are available at https://doi.org/10.1287/mnsc.2023.02157 .

Recent management trends highlight two techniques firms use to motivate employee effort: (1) fostering employees' organizational identification (OI) and (2) offering employees tangible rewards such as gift cards instead of cash rewards. We use three studies to examine how OI affects employees' reward valuation and how such effects differ depending on the reward type. Study 1 is an experiment, demonstrating that increasing OI increases the emphasis participants place on a reward's symbolic value, which then increases the total value of the reward—to a larger extent when the reward is tangible than when it is cash. Study 2 is an experiment, providing evidence that Study 1 results are robust to using a tangible reward that is not socially consumed, that is selected either by the firm or by the employee, and that is either a good or poor fit with the employee's personal preference. Finally, Study 3 is a survey, asking respondents about actual rewards they received from their current employer and capturing their actual OI with their current employer. Results in Study 3 are inferentially similar to those in Study 1 and Study 2, albeit stronger for rewards of smaller monetary value. Collectively, these results highlight the particular benefit of strong OI on how employees value tangible rewards relative to cash rewards, which should be of interest to incentive system designers.

Firms have long used recognition programs to engage and motivate employees. However, minimal research has examined the effectiveness of these programs in actual organizational settings. We predict that the adoption of a team-based recognition program will be associated with significant improvements in employee engagement and effort. We test our predictions using a pre-post research design administered at six fast-food franchise restaurant locations for a 12-week period. Employees at each location were eligible to receive non-monetary recognition (i.e., thank-you card, token gift) as a team every two weeks. The results support our predictions. We also find the benefits of team-based recognition extend to customer satisfaction and financial performance. Our findings should be of interest to compensation system designers in settings where employee motivation is low and individual performance is costly or difficult to measure. We show that team- based recognition can be effective in such settings. In so doing, we also extend the academic literature that has primarily focused on the behavioral effects of individual-level recognition.

The strength of performance incentives differs for employees within an organization. We describe how differences in incentive strength can lead to pay dispersion because employees facing stronger incentives work harder and earn more pay than those facing weaker incentives. We then conduct four experiments examining how the lower-paid employees respond to such pay dispersion. Consistent with our hypothesis derived from referent cognitions theory, we find that such pay dispersion decreases the lower-paid employees' perceived fairness and thus their effort. These results hold whether the employees are assigned to or self-select into the job with weaker incentives and whether they have more explicit or less explicit information about the economic rationale for the difference in incentive strength. Our findings are inconsistent with conventional economic reasoning and refine the conclusions from prior pay dispersion studies. The robustness of our results demonstrates their generalizability to a range of actual employment settings. Data Availability: Data and experimental instruments are available upon request. JEL Classifications: M41; M52; M55.

We conduct a field study at a performing arts theatre offering pay-what-you-want (PWYW) pricing as one of several pricing options to purchase tickets. While offering PWYW in this setting introduces multiple layers of self-selection, we find PWYW attendees are not a homogeneous group. Specifically, attendees’ identities vary in the extent they view PWYW as an economic transaction or a social exchange. We also find the effect of PWYW on subsequent consumption behavior is asymmetric. PWYW attendees do not subsequently become season subscribers. However, when the PWYW option was offered for a different performance, some season subscribers to that performance canceled their season ticket subscriptions with plans to use PWYW in the future, resulting in potentially lost revenues and a smaller season subscriber base. Thus, using PWYW as part of multiple pricing strategy may be especially costly when firms rely on dedicated patronage by consumers.