Abstract
We compare the effects of two prominent organizational control mechanisms—social pressure and monetary incentive—on cognitive control. Cognitive control underlies the human ability to regulate thoughts and actions in the pursuit of behavioral goals. Previous studies show that monetary incentives can contribute to goal-oriented behavior by activating proactive control. There is, however, much less evidence of how social pressure affects cognitive control and task performance. In a within-subject experimental design, we tested 47 subjects performing the AX-CPT task to compare the activation of cognitive control modes under social pressure and monetary incentive beyond mere instructions to perform better. Our results indicate that instructing participants to improve their performance on its own leads to a significant shift from a reactive to a proactive control mode and that both social pressure and monetary incentive further enhance performance.
Highlights
Organizations often implement formal control mechanisms to enhance the performance of their employees
We focus on the ability to engage cognitive control and to change cognitive control strategies in response to monetary incentives and social pressure
Our study provided the first direct comparison of the effects of social pressure and monetary incentive on behavioral performance
Summary
Organizations often implement formal control mechanisms to enhance the performance of their employees Such mechanisms can be designed in various ways, they all fundamentally rely on the use of positive and negative incentives, which are often monetary or social. Their positive effect on performance is thought to occur because they induce increased cognitive effort in employees (Curley et al, 1986; Trautmann et al, 2008; Vieider, 2009). Mainstream management control literature still associates human decisions that deviate from goal-oriented behavior, those that are flexible and influenced by emotions (Loewenstein and Lerner, 2003) with weaker impulse, emotional, and cognitive control
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