What Do You Recommend? The Effects of Communication on Misreporting in Autonomous Teams

Abstract

In autonomous teams, formal decision-making responsibility is shared, paving the way for communication to play a prominent role. We conduct three experimental studies to examine the influence of communication on team members in the context of cost reporting decisions. The first and second experimental study show that communication among team members fulfills a critical role in driving team misreporting. They reveal statistical evidence for a dishonesty shift, where communication does not discipline relatively dishonest team members but assists them in infecting relatively honest team members instead. In our third experimental study, in which teams report directly to their firm’s owner, we find no statistical evidence of the dishonesty shift. Jointly, the findings of all three experimental studies suggest that the adverse role of communication on misreporting in autonomous teams hinges on relatively honest team members revising their perception of the social norm based on specific situational cues.

Daniel Schaupp

Assistant Professor of Accounting

My research interests include transparency, opportunisitc behavior in organizations and performance evaluation and feedback systems.