Management Accounting Section Midyear Meeting

When Being Thanked Makes Employees Feel Less Appreciated: Evidence Regarding When and Why Peer-to-Peer Recognition Could Backfire

• In Event: Social Mission

Abstract

Peer recognition systems are commonly touted in the business press as a means to increase several important employee outcomes, including the degree to which employees feel appreciated. We study effects of these systems by collecting survey data at a small company both pre and post the rollout of a company-wide peer recognition system. Contrary to expectations we find that the average degree to which employees felt appreciated declined after the peer recognition system was implemented. Based on this observation, we develop and test theory to better explain why this decline likely occurred. Specifically, using an experiment we show that two peer recognition system design features, making peer recognition public and the presence of recognition leaderboards, can lead employees to compare their relative level of recognition with that of others. Our findings suggest that these social comparisons result in an average decline in feelings of appreciation even though, in isolation, recognition would otherwise be perceived positively. Broadly, our study highlights that firms should carefully consider how the features of their peer recognition systems affect employees, as some seemingly positive features may unintentionally harm employee outcomes.

Authors

• Paul Black, Auburn University

• Mark Cecchini, University of South Carolina

• Andrew H. Newman, University of South Carolina