• High performing managers set harsher targets for their employees because of “experience bias” – basing expectations on their own experience and performance
• Experience bias can lead to negative employee reactions as well as planning and coordination mistakes
• Managers should pay closer attention to individual skill sets and set targets based on individuals, in order to encourage better performance and drive company growth

Picture the scenario; you’re a budding manager or supervisor who has risen up the ranks. It hasn’t always been a smooth ride but months and years of meeting performance targets has taught you about the rewards they reap…

Based on the strident success and discipline that led you to securing your own senior role, it would only be reasonable to expect that setting targets for others which mirror your previous experience, wherever they are, would produce similar results wouldn’t it?

But, it turns out that doing exactly this can instead lead you to contributing towards one of the most problematic mismanagement traits. We’re talking about the “b word” – thats bias – here.

A study conducted by Professor Christoph Feichter at the Vienna University of Economics and Business found that high performing managers set harsher targets for their employees because they have a distorted perspective that their own experiences are standard practice. That bias leads them to, unknowingly, set targets that can be regarded by their staff as what the researchers call “objectively exceptional” (or in standard terms, unrealistic) rather than the standard practice the manager believes it to be.

The aim of Professor Feichter’s study was to analyse how supervisors’ performance in lower-level jobs prior to being promoted to a management role influenced the targets they set for their employees.

Two experiments were carried out. In the first, half of the participants played the role of a supervisor and the other half the role of employee. All employees worked on a simple task of counting zeros, with supervisors overseeing proceedings. The second experiment consisted of a memory task. Participants had eight minutes to read a short text about plastics and to answer 12 multiple choice questions about the topic afterwards. Scoring eight out of 12 was considered by the researchers to be “a “high performance”. Having all been given the same task experience, those who acted as supervisors in the first experiment were then instructed to set targets for the employees, and were asked to consider potentially paying them for exceeding those targets.

Professor Feichter’s findings indicate that, in the first running of the experiment those who classified as high performers in the supervisor group set higher performance targets for their employee group, regardless of the difficulty of the task or the performance of the employee.

The concerning thing to observe here is that the professor says that managers clearly engage in relative performance target setting, routed on the basis of their own subjective experience of similar or different tasks, despite them being objectively different in nature or difficulty. It is exemplified in the findings for instance that if the supervisors found the task easy they would set objectively exceptional targets.

Of course, ideally, managers should be taking the time to objectively examine the nature of the work their staff undertake and adjust the targets they set accordingly. The research however dispels this as an idealistic wish. The experience bias, the researchers say, leads managers to overemphasise their own experiences when setting targets for employees, hinging their expectations on how they themselves would have performed instead.

Professor Feichter elaborated on why else this style of decision making can be so problematic; “Performance targets are fundamental to motivation, coordination, and planning,” he says. Aside of the unrealistic nature of what the manager expects from their staff, it can also have repercussions on an employee’s job enjoyment and wellbeing, career progression – whether in the company or elsewhere – and can play a role in damaging company projections.

Some reading this may think the problem is just a case of managers coming from the outside, and attempting to assert a prior strategy that simply does not fit the mould of a different firm. Intriguingly it would seem not. Professor Feichter’s observations indicate this phenomenon is most likely to occur in firms that hire managers primarily from within, and with firms that require managers to gain the same task experience before being promoted.

With much of this bias occurring unconsciously, should we then have no reason to be optimistic that this vicious, one size fits all cycle of management style can be broken any time soon?

To the more pessimistic reader I say there may be hope yet. Professor Feichter explains that encouraging discussions about experience bias, target setting and emphasising uniqueness of managers’ own circumstances could raise more awareness to combat the issue. 

On the other hand the issue has a long historical routing in prior research such as the Peter Principle. Professor Feichter describes this as a phenomenon in which an individual with high ability or competence can lack the ability and competence necessary to perform the higher-level job despite being promoted in the first place. And some managers, with a fear of being regarded as incapable or replaceable, rarely choose to draw attention to their flaws by considering further training – leading to some ugly, sometimes toxic, traits. Another problem adding into the mix is the sheer overconfidence some managers may have in their own abilities, fuelled by previous successes, which make it tricky for them to see reason.

But he adds the issue at hand goes beyond this, explaining that it may not just be a mismatch of ability or competence that is the problem, but that even when there is a good match, managers might set “wrong” targets.

What should we glean from all this then? Other research goes to show that allowing the same mindsets and strategies to persist results in a continuation of an arguably flawed and inefficient system. For instance effective recruitment of a diverse workforce from the bottom up instils equality better than mealy mouthed tokenism from the top down. Managerial experience bias is similarly yet another barrier to progress.

The solution to this lingering issue may then lie in first recognising it as a systemic problem. There appears to be little evidence this is happening as bad managerial habits persist. To use the sensitive analogy of addiction, we can’t be hard pressed to change our ways until we admit we have a problem.

If we take the professor’s perspective on this the best way firms can do this is by implementing effective discussions around this as a common business practice. Training programs would also be required for managers to undertake that best teach them how to set targets on a less biassed basis.

Doing this would facilitate the transition from employee to manager in a way that sets a whole new precedent for more reflective and empathetic business practices.

By, James Dugdale