When Martin Wiernsperger was a graduate student, he and fellow student Mackenzie Feinberg realized they both had family members in the healthcare field – and both had heard relatives complain about lower-performing employees getting more opportunities for training and professional development than their higher-performing peers.
“It seemed like it was always those who performed badly who got selected by the head nurse or by the manager to go to those trainings,” said Wiernsperger, assistant professor of accounting at the Samuel Curtis Johnson Graduate School of Management, in the Cornell SC Johnson College of Business. “And this creates this fairness dilemma, both for the manager who makes this decision and for the employees who react to this.”
It’s a common conundrum: Faced with limited funds for staff training and development, the boss must decide which member of their team receives advanced skills training, which can be very costly. Is it the high-achieving employee who is already a leader on staff, or the less-proficient worker who might benefit more from the opportunity?
The research team found, through an interactive, role-playing experiment, that fairness norms in their workplace – egalitarian and more structured, vs. meritocratic, where employees are freer to choose their tasks – play a big role. Lower performing workers appear to expect the extra training in an egalitarian workplace, while higher performers feel more slighted when passed over for training in a meritocracy.
Wiernsperger is a co-author of “When Is it Fairer to Allocate Resources for Training to Lower-Performing versus Higher-Performing Employees?” published Sept. 20 in the Journal of Accounting Research. Other co-authors are Eric Chan, associate professor of accounting at the McCombs School of Business at the University of Texas, Austin; and Feinberg, now an assistant professor of accounting at the Goizueta Business School at Emory University.
Trainings are not only opportunities to travel and network, Wiernsperger said, but they increase one’s “human capital” and future marketability. From a manager’s perspective, however, training might be a bigger benefit to workers who have more room for growth than those who are already at a high level – thus the dilemma.
“From a manager’s perspective, in terms of productivity they would typically think, ‘I should send my lower performers for professional development so that they can essentially catch up,'” Wiernsperger said. “The dollar spent on improving their performance typically goes further than somebody who is already doing a good job.”
Wiernsperger and the team devised a unique experiment in an attempt to replicate both egalitarian and meritocratic work environments. A total of 186 study participants were divided into three-person groups, with one person acting as the manager and the other two employees.
The employees were given one of two quizzes on popular idioms, with questions in either mostly English (8 of 12 questions) or mostly German (8 of 12), which only a few participants could understand. One group could choose which quiz to take, to replicate a meritocratic environment; the other was given a quiz at random, in line with a more egalitarian ethos.
Based on the results of the quiz, the manager would select one of the two employees for “training” – in this case, getting help with the German idioms in order to do better on a second quiz. The employees worked under a “tournament” contract: For each quiz, the higher performers received a large prize, while the runner-up got nothing.
Following the second quiz, participants took part in a low-skill activity that benefitted the manager but not themselves, to replicate attitudes toward either receiving or not receiving training.
As expected, employees who received the training generally reacted positively to it, although under egalitarian norms, lower-performing workers responded less enthusiastically to receiving the training than higher performers, appearing to take the opportunity for granted, the researchers wrote.
And lower performers in the egalitarian realm felt more slighted than those in the meritocratic regime when they didn’t receive the training. Conversely, when meritocratic norms prevailed, higher performers reacted more negatively when passed over for training, but both lower and higher performers react similarly when receiving it.
The findings, the researchers wrote, highlight the balance firms must strike between rewarding higher performers and supporting the development of lower performers to optimize overall productivity. Wiernsperger said he expected that some managers might “think a little bit more about fairness” and offer the training to higher performers, but found that most opted to further train lower performers.
Fairness vs. productivity is the “main tension” in this work, said Wiernsperger: “It’s a very challenging question from a manager’s perspective. They might not fully consider fairness, and focus just on productivity. And this can have, depending on the norms that prevail in the work environment, pretty negative implications for further productivity.”
