Academic journal article Administrative Science Quarterly

Sanctioning Systems, Decision Frames, and Cooperation

Academic journal article Administrative Science Quarterly

Sanctioning Systems, Decision Frames, and Cooperation

Article excerpt

Three studies are used to examine how surveillance and sanctioning systems affect cooperative behavior in dilemma situations. The first two studies demonstrate that a weak sanctioning system results in less cooperation than no sanctioning system; furthermore, results from the second study suggest that sanctions affect the type of decision people perceive they are making, prompting them to see it as a business rather than an ethical decision. The results from these studies are used to develop a theoretical model that postulates that the relationship between sanctions and cooperation is due to both a signaling effect, in which sanctions influence the type of decision that is perceived to be made, and a processing effect, in which the decision processing, including whether or not the strength of the sanction is considered, depends on the decision frame evoked. A third study provides support for the processing-effect hypothesis. [*]

The use of surveillance and sanctioning systems to monitor and motivate employees is almost commonplace. It is estimated that over 60 percent of companies use surveillance and monitoring procedures, including taping phone calls, perusing e-mail messages, and relying on spy cameras (Selnow and Gilbert, 1997). Many managerial trends have contributed to the increasing importance of such systems in organizations. Concepts such as just-in-time inventory and total quality control, which rely heavily on monitoring performance relative to a benchmark standard, have been argued to create a demand for systems of surveillance (Sewell and Wilkinson, 1992). Surveillance and sanctioning systems have also been seen as critical in promoting ethics in organizations, since it has been argued, the "failure to seriously monitor, measure and reward (punish) the performance of individuals on the ethical plane will leave codes of conduct operating in a vacuum, of little use in actually promoting ethical behavior" (Lindsay, Irvine, and Lindsay, 1996: 403).

Given the focus of many of our organizational theories, it comes as no surprise that these systems play such a prominent role in organizations. From theories about the cognitions and behaviors of individuals to theories about the behavior of firms, the monitoring and sanctioning of employee, managerial, and organizational actions are portrayed as important components of firm success. We see this emphasis in discussions of the functions of management, which have been described as consisting of the components "to plan, organize, staff and control" (Barnard, 1938: xiv). The last component, control, has been further specified to consist of three stages: (1) specifying and communicating objectives; (2) monitoring performance through measurement (feedback/control); and (3) motivating employees to accomplish objectives by linking outcomes to achieving those objectives (Otley and Berry, 1980).

At a micro level, the monitoring of performance is a central piece of Skinner's (1953) theory of reinforcement, in which behavior is measured and, based on the outcome, a particular reinforcement is applied. Agency theory, a more macrolevel perspective concerned with understanding and resolving the conflict between owners and workers (Jensen and Meckling, 1976; Fama, 1980), has as its focus the creation of systems that ensure worker compliance. Monitoring employee behavior is at the heart of these systems, in which surveillance of employee actions, accompanied by sanctions such as money or promotions, is used to reduce potentially destructive behavior (Pfeffer, 1994).

Despite the emphasis on surveillance and sanctioning systems found in our organizational theories and the promise of such systems for ensuring cooperation in organizations, there appears to be a growing number of skeptics. [1] Pfeffer (1994) provided an insightful look at the counterproductive effects of managerial control systems. Similarly, Walsh and Seward (1990) have argued that inefficiencies in control systems are linked to firm failure. …

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