Study 1: Internal promotions and employee reciprocity

In a study published in the Journal of Accounting Research, Maas collaborated with colleagues from the University of Texas at Austin and the University of Kansas. They found that managers who need to choose between promoting a current employee and hiring a better equipped external candidate, often prefer internal promotions. The reason is that they feel that they need to reciprocate employees’ hard work. They also find that internal promotions are more common when firms can measure employee performance less precisely, as managers prefer to give employees the ‘benefit of the doubt’.

Study 2: Strategic Performance Evaluations

In a forthcoming study in The Accounting Review, Maas and colleagues from Erasmus University Rotterdam and the University of Illinois at Urbana-Champaign investigate how middle managers deliberately manipulate performance evaluations. They inflate the evaluations of weaker employees while deflating the ratings of top performers. They do this to keep the best people in their team while increasing the probability that weaker performers are selected for tasks elsewhere in the organisation. The authors also find that such strategic promotion behaviour by managers is more common in settings where  it is more difficult for employees to verify whether the best candidate got the job. In addition, it is more common  when not only the manager but the whole team benefits from keeping the best people on board while promoting weaker performers ‘up and out’.

Study 3: Delegation decisions and target setting

A third study coauthored with ABS colleague Bei Shi forthcoming in Management Accounting Research, looks at managers’ delegation decisions. Managers sometimes need to choose between handling a task themselves and delegating it to a subordinate. The authors find that managers tend to delegate tasks with difficult targets to avoid potential blame for failing to meet targets. On the other hand, they hold on to tasks with easy targets to take credit for achieving them. Notably, this happens independently of whether the manager or the employee is expected to do better on the task. The study highlights that difficult targets can lead to 'over-delegation' and easy targets to 'under-delegation', potentially destroying firm value.