Sangam: A Confluence of Knowledge Streams

Reviewing and theorizing the unintended consequences of performance management systems

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dc.creator Franco-Santos, Monica
dc.creator Otley, David
dc.date 2018-07-30T15:37:39Z
dc.date 2018-07-30T15:37:39Z
dc.date 2018-07-02
dc.date.accessioned 2022-05-25T16:37:23Z
dc.date.available 2022-05-25T16:37:23Z
dc.identifier Franco-Santos M, Otley D. (2018) Reviewing and theorizing the unintended consequences of performance management systems. International Journal of Management Reviews, Volume 20, Issue 3, July 2018, pp. 696-730
dc.identifier 1460-8545
dc.identifier http://dx.doi.org/10.1111/ijmr.12183
dc.identifier http://dspace.lib.cranfield.ac.uk/handle/1826/13366
dc.identifier 19971184
dc.identifier.uri http://localhost:8080/xmlui/handle/CUHPOERS/182224
dc.description Different design choices in the controls used to manage performance often lead to a range of unintended consequences, which have profound effects on individuals and organizations. This paper presents a mixed review (both systematic and eclectic) of the literature on the unintended consequences of performance management systems and develops a typology to explain how and why they occur. It finds that the most salient unintended consequences of directive performance management systems are gaming, information manipulation, selective attention, illusion of control and relationships transformation. It argues that these consequences exist due to limiting factors such as ignorance, error, short-term concerns, fundamental values, self-fulfilling forecasts and changes in social relationships. The emerging typology-based theory suggests that the choice of control mechanisms is based on two key assumptions concerning goal-alignment and goal uncertainty that relate back to ideas in agency theory and stewardship theory. It concludes that, in the design of performance management systems, the more the ‘assumed’ reality about the state of goal-alignment and goal-uncertainty diverges from the ‘real’ state of affairs, the more the resultant system is likely to create perverse unintended consequences, leading to poor organisational outcomes.
dc.language en
dc.publisher Wiley
dc.rights Attribution-NonCommercial 4.0 International
dc.rights http://creativecommons.org/licenses/by-nc/4.0/
dc.subject Performance management
dc.subject Organizational control
dc.subject management control
dc.subject Unintended consequences
dc.subject Agency theory
dc.subject Stewardship theory
dc.title Reviewing and theorizing the unintended consequences of performance management systems
dc.type Article


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