Target setting in multi-divisional organizations

Research output: Contribution to journalArticle

Abstract

The target-setting literature has primarily focused on motivation issues in relatively simple single-task settings. I argue that performance targets also play an important role in addressing other issues such as multitasking, information asymmetry, retention, rent extraction, commitment, and coordination in multi-agent settings. Broadening the scope of the literature can help reconcile the theory and empirical evidence on how organizations set and revise performance targets. Moreover, a broader scope can help motivate emerging work on target-setting choices such as the number of targets for each performance dimension, concavity or convexity of target-based contracts, relative target difficulty for different performance dimensions, and coordination and disclosure of targets in multi-agent settings.

Original languageEnglish (US)
Pages (from-to)13-27
Number of pages15
JournalJournal of Management Accounting Research
Volume30
Issue number3
DOIs
Publication statusPublished - Sep 1 2018
Externally publishedYes

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Keywords

  • Budgetary slack
  • Incentives
  • Performance targets
  • Retention
  • Target ratcheting

ASJC Scopus subject areas

  • Business and International Management
  • Accounting

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