ASU researcher says performance standards could be leading to more workplace cheating

Michael Baer,  Assistant Professor, W.P. Carey School of Business),  has studied workplace cheating.

His research points out that pressure from workplace standards could unwittingly lead companies to participate in employees cheating at work as they strive to meet those standards. Baer discusses his study.

Transcript:

TED SIMONS: CORPORATE CHEATING SCANDALS LIKE THOSE AT WELLS FARGO AND VOLKSWAGON ARE ON THE RISE. A NEW STUDY SHOWS THAT INCREASED PRESSURE ON EMPLOYEES COULD BE THE REASON. JOINING US NOW TO DISCUSS THE STUDY IS MICHAEL BAER FROM ASU'S W.P. CAREY SCHOOL OF BUSINESS. LET'S DEFINE TERMS. WORKPLACE CHEATING. WHAT ARE WE TALKING ABOUT?

MICHAEL BAER: WE LOOKED AT UNETHICAL ACTS THAT EMPLOYEES COMMIT TO HELP THEMSELVES GET AHEAD, HELP THEMSELVES GET REWARDS, BENEFITS, OR RECOGNITION THAT THEY DIDN'T DESERVE BASED ON THEIR EFFORTS ALONE.

TED SIMONS: SO THERE ARE DIFFERENT TYPES OF CHEATING, THEN.

MICHAEL BAER: THERE ARE. EMPLOYEES WILL OVERINFLATE THEIR ACTUAL PERFORMANCE AND THEY WILL TRY TO MINIMIZE THE MISTAKES THEY ACTUALLY MADE. WE FOUND EMPLOYEES WERE WILLING TO THROW THEIR COWORKERS UNDER THE BUS AND STEAL THEIR IDEAS AS WELL.

TED SIMONS: IT’S A JUNGLE OUT THERE.

MICHAEL BAER: IT IS.

TED SIMONS: SO WHY IS THIS HAPPENING? COMMON SENSE TELLS US THERE’S A LITTLE SELF-PRESERVATION GOING ON BUT IN TERMS OF RESEARCH WHY IS IT GOING ON?

MICHAEL BAER: IT REALLY DOES COME DOWN TO SELF PRESERVATION AT THE BASIC LEVEL. WE WERE DISTURBED BY THE NUMBER OF CHEATING SCANDALS, AND WE STARTED THIS RESEARCH YEARS AGO. ONE OF THE THINGS THAT PUT THIS ON THE RADAR IS THE SCANDAL IN ATLANTAWITH THE EDUCATORS WHO WERE ON A WIDE SCALE CHANGING THE TEST SCORES OF THEIR STUDENTS SO THEY LOOKED BETTER AND THEIR CLASSES LOOKED LIKE THEY WERE LEARNING MORE. WE DID WIDESCALE POLLS ACROSS THE COUNTRY ASKING PEOPLE IF THEY WITNESSESED THESE CHEATING BEHAVIORS IN THE WORKPLACE AND MOST EMPLOYEES HAD SEEN SOME TYPES OF THESE BEHAVIORS. WE BEGAN TO ASK WHY MIGHT THAT BE. WE SUGGESTED SOME OF THAT MIGHT COME FROM THE PRESSURE ORGANIZATIONS ARE PUTTING ON EMPLOYEES. NOW, AT ITS BASE LEVEL, HAVING HIGH EXPECTATIONS OF EMPLOYEES IS A GOOD THING. GOALS ARE A GOOD THING, IT HELPS EMPLOYEES TO PERFORM. BUT WHEN THOSE GOALS BECOME UNREALISTIC, THAT’S WHEN EMPLOYEES START TO GO, YOU KNOW WHAT? I DON’T THINK I CAN REACH THIS.

TED SIMONS: ARE THEY ANGRY OR ARE THEY JUST BEING REALISTIC? IS IT SURVIVAL OR A LITTLE BIT OF ANGER? A LITTLE RESENTMENT?

MICHAEL BAER: WE FOUND THEY GOT ANGRY. IT TURNS OUT WHEN WE GET ANGRY, WE BEGIN TO FOCUS ON OUR OWN INTERESTS. IF YOU HAVE EMPLOYEES ANGRY ABOUT THSEE PRESSURES ON THEM THEY STOP THINKING ABOUT WHAT IS BEST FOR THE ORGANIZATION AND THINK ABOUT WHAT IS BEST FOR ME AND ONE OF THE WAYS THEY CAN LOOK OUT FOR WHAT IS BEST FOR THEM, IF THEY’RE NOT PERFORMING AT A HIGH LEVEL, THEY CAN LIE ABOUT THE FACT.

TED SIMONS: AND YOU’RE TALKING OVERINFLATED PERFORMANCE, THAT KIND OF STUFF. OKAY, SO WHAT CAN COMPANIES DO ABOUT IT? YOU WANT TO SUCCEED. YOU WANT TO MOVE FORWARD, DRIVE YOUR EMPLOYEES, YET YOU DON’T WANT TO SET-IS IT JUST UNREALISTIC EXPECTATIONS? WHAT’S INVOLVED HERE?

MICHAEL BAER: YEAH, AND WELLS FARGO, NOT TO PICK ON THEM TOO MUCH BUT THEY DESERVE A LITTLE PICKING ON. THE PERFORMANCE STANDARDS THAT THEY SET, THEY PICKED THAT NUMBER OUT OF THE AIR. THEY SAID EVERY CLIENT SHOULD HAVE EIGHT ACCOUNTS. AND WHEN ASKED WHY THEY HAD EIGHT ACCOUNTS, THE C-E-O SAID BECAUSE EIGHT RHYMES WITH GREAT. THEN HE JOKED AGAIN AND SAID MAYBE WE NEED TO INCREASE THAT AND SAID LET'S GO AGAIN FOR TEN. THERE WAS NO RESEARCH THAT SHOWED, ONE, THAT IT WAS EVEN POSSIBLE FOR THESE EMPLOYEES TO GET CLIENTS TO OPEN UP AN AVERAGE OF EIGHT ACCOUNTS, OR THAT CLIENTS NEEDED EIGHT ACCOUNTS. THEY KIND OF PICKED THAT OUT OF THE AIR. WE HAD A SIMILAR THING HAPPENING TO V-W. THEY WERE ASKED TO CREATE A CLEAN DIESEL ENGINE THAT GOT GREAT FUEL ECONOMY AND WAS AFFORDABLE. THAT IS WHEN EMPLOYEES GO IF I CAN'T REACH THIS BY ETHICAL MEANS MAYBE I CAN DO IT IN OTHER WAYS.

TED SIMONS: THE IDEA OF REACHING GOALS IS GREAT, BUT THAT CAN'T SUPERSEDE BASIC ETHICS.

MICHAEL BAER: ABSOLUTELY, AND I THINK THAT’S WHAT ORGANIZATIONS NEED TO STRESS: WE WANT YOU TO PERFORM WELL BUT THERE IS A LINE WE DON'T CROSS. WE DO THINGS THE RIGHT WAY. AND ONE WAY YOU CAN DO THAT IS SET A ZERO TOLERANCE FOR THAT SORT OF BEHAVIOR WHERE EMPLOYEES REALIZE THIS ISN'T SOMETHING THAT IS ALLOWED IN THE ORGANIZATION AND SOMETHING YOU WILL BE LEAVING THE ORGANIZATION IF YOU ENGAGE IN THIS. ORGANIZATIONS ALWAYS NEED TO REALIZE WHAT TYPE OF PERFORMANCE IS POSSIBLE INSTEAD OF JUST PULLING THESE NUMBERS OUT OF THE AIR.

TED SIMONS: THAT IS A TRICKY DYNAMIC IF YOU ARE THE OWNER OF A CORPORATION OR IN MANAGEMENT. YOU WANT TO SUCCEED AND MOVE FORWARD AND A LOT OF BUSINESSES ARE BEATING THE OTHER GUY AND IF THE OTHER GUY IS DOING X, YOU WANT TO DO X PLUS ONE. THERE IS A DYNAMIC THERE.

MICHAEL BAER: THIS IS A TRICKY THING. I WAS A SMALL BUSINESS OWNER MYSELF AND I TRIED TO SET THESE REALISTIC EXPLANATIONS. I KNOW THERE WERE TIMES WHEN I SAID WE WILL PUT UP THREE WALLS AND PUT THE ROOF ON TODAY NOT ASKING MYSELF IS THAT A REALISTIC EXPECTATION.

TED SIMONS: DID YOU FIND CULTURAL DIFFERENCES? YOU MENTIONED VOLKSWAGEN, YOU HAVE WELLS FARGO HERE IN AMERICA, AND JAPANESE COMPANIES HAVE A DIFFERENT OUTLOOK AS FAR AS CORPORATE STRUCTURE AND ETHICS ARE CONCERNED. WE JUST SAW THAT STEEL COMPANY COMING OUT AND SAYING MAYBE IT’S NOT AS STRONG AS IT SHOULD BE. WHAT ARE YOU SEEING OUT THERE?

MICHAEL BAER: WITH OUR RESEARCH, WE ONLY LOOKED AT EMPLOYEES WITHIN THE UNITED STATES. WITH OUR DATA WE ARE NOT ABLE TO SPEAK IF THIS IS HAPPENING INTERNATIONALLY. BUT WE CERTAINLY DO SEE IT A LOT IN THE U.S. WHETHER THAT IS HAPPENING MORE IN OTHER COUNTRIES, I AM NOT SURE.

TED SIMONS: AGAIN, ALL RIGHT. YOU KIND OF WONDER WITH THE VOLKSWAGEN AND JAPANESE STEEL BUSINESS. IF IT ISN'T HAPPENING MORE IT IS HAPPENING.

MICHAEL BAER: IT IS CERTAINLY HAPPENING IN MORE THAN JUST THE U.S.

TED SIMONS: ANYTHING IN THIS RESEARCH SURPRISE YOU?

MICHAEL BAER: I THINK IT WAS SURPRISING HOW OFTEN PEOPLE HAD SEEN THIS TYPE OF BEHAVIOR IN THE WORKPLACE. AND ANOTHER ONE OF THOSE WAS THE WILLINGNESS TO THROW COWORKERS UNDER THE BUS. WHEN YOU STEAL ANOTHER CO-WORKER’S IDEA THAT IS GOING PRETTY FAR.

TED SIMONS: LAST QUESTION: I AM A BUSINESS OWNER AND SEEING THIS AND I AM WONDERING WHAT MY PEOPLE ARE DOING AND WHAT KIND OF CRAZINESS IS GOING ON. ADVICE FOR THE EMPLOYER.

MICHAEL BAER: I WOULD SAY YOU NEED TO COMMUNICATE AT A BASELINE THERE IS A LINE WE DON'T CROSS. WE DO THINGS THE RIGHT WAY. AND COMMUNICATE TO EMPLOYEES THAT IF THEY ARE HAVING TROUBLE THEY NEED AN OPEN AND HONEST COMMUNICATION. IF EVERY TIME YOU SET A GOAL, AN EMPLOYEE IS COMING AND SAYING THESE ARE TOO HIGH AND NOT REALISTIC I THINK THAT IS A RED FLAG PERHAPS IT’S THE EMPLOYEE AND NOTTHE PERFORMANCE STANDARDS. IF 90% OF THE EMPLOYEES CAN'T REACH THE STANDARDS THAT IS A CLUE.

TED SIMONS: INTERESTING STUDY. GOOD TO HAVE YOU HERE. THANKS FOR JOINING US.