Quality of performance metrics, informal peer monitoring and goal commitment

Abstract

We examine whether the quality of performance metrics affects informal peer monitoring and, in turn, goal commitment. By fostering performance-oriented behaviors, performance metrics drive managers to involve themselves in learning and improvement efforts, building a fertile atmosphere for informal peer monitoring. We argue that the quality of performance metrics is positively associated with direct peer monitoring and negatively linked to indirect peer monitoring. Subsequently, we postulate that direct (indirect) peer monitoring is positively (negatively) associated with goal commitment. We use PLS to analyze survey data from store managers in a large retail firm. Results provide overall support for our hypotheses.

The effect of management control systems in managing the unknown: Does the market appreciate the breadth of vision?

“…We follow the well-known work of Anthony ( 1965 ) to define MCS as “the process by which managers assure that resources are obtained and used effectively and efficiently in the accomplishment of the organization’s objectives” (p. 17). This definition is in line with the definitions subsequently developed, which include financial, strategic and operational metrics and information to improve decision-making and planning (Bisbe and Malagueño 2012 ; Nielsen et al 2015 ; de Harlez and Malagueño 2016 ; Gomez-Conde et al 2022 ).…”