Management Accounting Section Midyear Meeting

The Effect of an Electronic Monitoring System on Employees' Productivity in Telecommuting Arrangements

• In Event: Labor Force Management

Abstract

When employees work from home, organizations have traditionally placed a stronger reliance on output-based controls due to the inability to physically observe their employees. Due to recent advances in technology, however, many organizations now use input-based controls. One such input-based control is an electronic monitoring system, which records the number of hours spent working and leaves out any time in which an employee does not perform work activities. We take advantage of a field-research setting in which the organization adopts an electronic monitoring system for its telecommuting employees. We find an electronic monitoring system leads to a 6.1% productivity increase for telecommuting employees. We also find an electronic monitoring system reduces employees’ self-control problems and leads employees to complete tasks requiring greater effort. Finally, we find low performers’ productivity increases more following an electronic monitoring system. Our results suggest technology plays a significant role in expanding organizations’ management control choices when achieving controls in telecommuting arrangements.

Authors

• In Gyun Baek, National University of Singapore

• Yea Hee Ko, University of Wisconsin-Madison