Managerial Reporting and Collaboration in Multi-tier Organizations

• In Event: 4.03 Teamwork and Collaboration

Abstract

As organizations increase in size and incorporate more hierarchical layers, it becomes increasingly difficult for affiliated parties to collaborate on an organizational level. We use an experiment to examine whether and how managerial reporting increases collaboration in multi-tier organizations. We predict and find that when managers report their private information to all other parties in their organization, they increase collaboration by building a better reputation for themselves in two ways. First, reporting to all other parties builds a manager’s reputation by enabling organization-wide verification of the manager’s private information, which eliminates the manager’s opportunity to exploit his or her information advantage at the cost of other parties. Second, when managers report to all other parties, they build a better reputation by signaling their intention to collaborate with affiliated parties on an organizational level. We run additional experimental conditions to disentangle these two effects of managerial reporting. We also show that managers with high levels of grit possess more determination and perseverance to build a better reputation by reporting to all other parties operating in their organization.

Authors

• Farah Maham Arshad, Universiteit van Tilburg

• Bart Dierynck, Tilburg University

• Victor van Pelt, Tilburg University