• Peer monitoring is highly effective in the workplace for ensuring that employees will keep each other “in check”
• The less ‘effort observability’ that is available to employees, the more likely they are to manipulate their performance
• Employers can use this knowledge to ensure that staff base their efforts on what they perceive their colleagues to be doing

Effort and performance manipulation is something everyone can relate to in some way. For me, I think back to my school days. For those of you who may be unfamiliar with the Irish school system, there are two state exams; the Junior Certificate, which is taken at the end of the third year of secondary school, and the Leaving Certificate, which students complete at the end of sixth year, at 17 or 18 years old. This is the big one. It determines which university course a student can go on to do, if that is the road which they wish to travel.

When I was studying for my junior certificate I, like everyone else my age, believed I knew everything. I had my life planned out with aspirations of becoming a teacher. However, my studying, or lack thereof, definitely suggested otherwise, and, when I received the results for my mock exams, I got a hard dose of reality.

Admittedly I didn’t do terribly, but my parents were asking questions. And so was I – after all, I had been matching the efforts of my classmates, all of whom had made out that, like me, they were doing the bare minimum. Shocked doesn’t begin to describe how I felt when I saw that they had achieved high Bs and even As, whilst I had struggled to gain a low B.

This was a wake- up call and, thankfully, I was able to use the experience to make a greater effort in my future studies so that, when the real exams came later on, I much more prepared. But, according to research from ESSEC Business School, my teenage expectations and efforts were perhaps to be expected…

The study, undertaken by researchers Stefan Linder and Sabra Khajehnejad (Assistant Professor at KU Leuven and former Ph.D. student at ESSEC) focuses on the concept of performance manipulation, and how this can be utilised by managers to boost employee effort and output.

You may be wondering, what exactly is peer monitoring? Linder and Khajehnejad define it as when a firm use the morals of their employees to keep one another in check. Peer monitoring, they say, can be a highly effective tool in the workplace, but only when certain information is available to employees. If employees can’t see the effort their peers are putting in to their work, they are less likely to manipulate their own work-related activities. But, if they can see the efforts and end results of others, they are more likely to adapt their own performance accordingly.

The research was conducted through surveys, inviting managers of companies across multiple industries to take part. The surveys explored managers’ perceptions of how much influence they had over employee performance, and how observable they believed their own efforts were to staff, as well as that of their employees.

They were also asked about the ways in which they might manipulate performance. It is important to note, that the word manipulate does not necessarily mean something ‘bad’. It could mean that they try harder, make more calls or blast through their targets, effectively adjusting their own performance to attempt to match the results of their peers. But, in some cases, it could mean something more damaging.

Stefan Linder and Sabra Khajehnejad’s research suggests that employers can utilise peer monitoring to ensure staff continue to perform to their best, and encourage their colleagues to do the same, so long as the right conditions are put in place to do so.

The researchers observed that, like their hypothesis, effort and performance measures complemented each other when both were made visible and available to employees. In environments where an employees’ effort was difficult to measure and observe, the knowledge that their performance would be visible to their peers made employees more likely to manipulate their efforts, for better or for worse, in order to fit in with those around them.

This rings true for my own early study efforts. Like the employees in Linder and Khajehnejad’s study, I had been fooled by the attitudes of the people around me into thinking that all would be well if I put in the supposed minimum amount of effort that they too were extending. When my results were not up to standard, I found myself hiding the truth, telling my peers that I got mostly B’s, as I didn’t want to appear stupid. Lying to save face made sense.

Whilst my white lie at fifteen did not have serious consequences, applying this same logic to the workplace causes significant issues when it comes to accurately measuring performance and productivity, and can even impact upon employee wellbeing. It is understandable that nobody wants  to stand out from their peers for anything other than excellence – because performance and public opinion is tied to promotions and wage increases. But, aside of ability, the level of stress that peer monitoring can cause is quite extreme. Hence, peer monitoring can become quite problematic if it is not managed carefully.

The researchers recommended that if a firm wants to rely on peer monitoring for results, they must be careful with how much detail they make available to staff about their peers’ work. If their effort is not evident, they are more likely to manipulate results- which, as we have seen from the research, can mean bad things for the company.

My fifteen-year-old self could certainly testify to this. Before my mock test results came out, I could act nonchalant like everyone else. Once they became public, the pressure to achieve hit me. It wasn’t easy to hide the results when they were written in big red ink all over the paper. This was a big factor in spurring me on. It could be said that I manipulated my results by studying harder, staying up later and forcing myself to memorise Shakespeare quotes off by heart.

Khajehnejad says, “Firms, and in particular ones that rely on peer monitoring, should consider what type of information is observable to peers given the work and/or reporting setting in place and what changes in the work or reporting design might be necessary” to this, and Linder adds that “this research offers evidence that, in order to minimise performance manipulation, observability of both performance and effort to peers should both be taken into account.”

And this is where peer mentoring can provide potential to both employers and employees. Having a realistic sense of colleagues work ethics can spur others on to aspire to the same. But employers must understand where to draw the line between observation and recognition, and public shaming.

To sum up, if an employee can see the effort that is being put in by their coworkers, they are less likely to feel an intense pressure to manipulate their efforts and results.

Employers would do well to consider the findings of ESSEC’s research- these being the pressure that comes from peer monitoring and publishing only partial results. The key is to listen to your employees. Numbers don’t always tell the full story of what your staff are capable of. But ensure that you don’t coast along like I did. The saying “fake it ‘til you make it” isn’t all that it seems.