Management accounting in the laboratory and in social context: Four contrasts, 1975–2014

Luft, Joan L.

doi:10.1016/j.aos.2015.08.001

Cited by 17 publications

(5 citation statements)

References 87 publications

(114 reference statements)

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“…Second, our study answers calls for more research into the decision‐facilitating role of management accounting (e.g., Luft, 2016; Sprinkle & Williamson, 2006). Existing research in this area shows that the presence and accuracy of information about causal linkages between leading and lagging performance indicators (Humphreys et al, 2016; Kelly, 2010) and the timing of performance feedback (Thornock, 2016) can affect managers' learning.…”

Section: Introductionmentioning

confidence: 76%

Navigating through the noise: The effect of color‐coded performance feedback on decision‐making

Cardinaels,

Kramer,

Maas

2024

Contemporary Accting Res

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Many companies use color codes in their internal performance reports to highlight how current performance compares to performance in a previous period. We examine whether the use of color coding affects managers' decision‐making in a resource allocation task. We argue that managers' decision accuracy will be lower if they receive noisier feedback, but that this detrimental effect of noise can be mitigated through color coding. Using two experiments, we find evidence consistent with our theory. Managers who receive reports in which performance increases are color‐coded green and performance decreases are color‐coded red are less affected by noise than managers who receive feedback reports without color coding. Supplemental analyses suggest that color coding induces managers to process feedback in a more holistic manner, which reduces the adverse effect of noise on managers' learning processes. Our findings have several important implications for research and practice.This article is protected by copyright. All rights reserved.

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Section: Introductionmentioning

confidence: 76%

Navigating through the noise: The effect of color‐coded performance feedback on decision‐making

Cardinaels,

Kramer,

Maas

2024

Contemporary Accting Res

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“…Although the outcome of RPI provision has been extensively examined in previous studies (Frederickson, 1992;Hannan et al, 2013;Tafkov, 2013) there are still limited evidences that could be drawn regarding the relationship between RPI, goal-setting elements and individual's performance. As one of the purposes of an organisation's control system is to ensure that employee's actions are in line with the organisation's best interests (Luft, 2016a;2016b), this study contributes to the stream of accounting literature by demonstrating an experimental evidence on how the interaction between feedback -represented by the RPI -and goal-setting elements -manifested by goal difficulty and goal commitment -could eventually affect employee's performance.…”

Section: Introductionmentioning

confidence: 81%

“…This study contributes to the behavioural management accounting literature -particularly in the field of RPI, feedback and goal settingby showing that the positive effect of RPI on performance is enhanced to a greater degree by an individual's high goal commitment. Although the relationship among these factors are considered important to be examined, there is still limited evidence regarding how the RPI -as a relative form of feedback -can be used strategically alongside goal setting elements to enhance an individual's performance in a condition when the monetary incentive is constantly held (Luft, 2016a;2016b). In terms of the feedback-goal relationship, Renn (2003) used data from a field study to explain the moderating effect of goal commitment on the relationship between perceived feedback and work performance.…”

Section: Discussionmentioning

confidence: 99%

Experimental Examination of the Relationship between Relative Performance Information, Goal Setting and Performance

Ludji

2018

AJBA

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Manuscript type: Research paper. Research aims: This study experimentally examines the relationship between relative performance information (RPI), goal setting and performance. Hypotheses are developed based on social comparison theory, goal setting theory and relevant prior studies. Design/Methodology/Approach: This study deploys multiple sessions of experiments with 110 undergraduate students as the participants. The two manipulated variables are the provision of RPI and the level of goal difficulty. Research findings: Results from the experiment indicate that the presence of RPI is positively associated with performance, and an attainable goal is associated with high goal commitment and eventually, higher performance. More importantly, this study finds an interaction between RPI and goal commitment, where the positive effect of RPI on performance is more pronounced in a condition where individual's goal commitment is high. Theoretical contributions/Originality: This study contributes to the accounting literature by providing empirical evidence that the

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“…Future research could address the question how enabling versus coercive design characteristics or development processes influence the possibilities for a performance measurement system to achieve one or both purposes. Studying how both purposes can be fulfilled seems relevant also for bridging the gap between research streams that address either one or the other purpose (see also Luft, 2016).…”

Section: Discussionmentioning

confidence: 99%

The effect of enabling versus coercive performance measurement systems on procedural fairness and red tape

2021

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In this study, we investigate the effects of an enabling versus a coercive performance measurement system on how employees perceive the procedural quality of such systems. In particular, we examine the design characteristics and the development process of performance measurement systems. We hypothesize that an enabling design and an enabling development process, as compared to a coercive design and a coercive development process, lead to perceptions of greater procedural fairness and less red tape. To test our hypotheses, we conduct an experiment with two different samples (a student laboratory sample and an online sample). In general, our results indicate that an enabling performance measurement system design and an enabling system development process both independently increase procedural fairness and decrease red tape. These findings imply that organizations interested in improving the procedural quality of their performance measurement system should focus on designing and developing a system that is enabling rather than coercive.

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Management accounting in the laboratory and in social context: Four contrasts, 1975–2014

Cited by 17 publications

References 87 publications

Navigating through the noise: The effect of color‐coded performance feedback on decision‐making

Navigating through the noise: The effect of color‐coded performance feedback on decision‐making

Experimental Examination of the Relationship between Relative Performance Information, Goal Setting and Performance

The effect of enabling versus coercive performance measurement systems on procedural fairness and red tape

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