TUM Management Insights

Why employees do (not) speak up about project flaws

Innovation is crucial in modern business environments, and successful innovation usually involves the pursuit of multiple projects. As these projects advance, they generate new information but also require higher investments for further development. A key task for project managers is to evaluate the available information and then decide whether the project should be continued and investments be made, or the project should be abondoned and resources be allocated to other projects. At the same time, such decisions are challenging because the flaws of a project may been known by some of the team’s members but not the project leader. When are these project team members willing to share their information about a flaw of their project with the project leader?

In an article published in the Journal of Management, Professor Holger Patzelt from the TUM School of Management together with Professor Dean Shepherd (University of Notre Dame, USA) and Professor Christopher Berry (Indiana University, USA) explore to what extent information of a project’s flaw impacts project team members’ willingness to share their concerns with the project leader, and to what extent does this relationship vary across project team members. To do so, the authors draw on insights from the literature on voice and an experimental decision making task involving 235 R&D project team members of large and innovative firms.

As a first important new insight, the study shows that information about a project’s flaw is generally a good thing – the more objective information a project team member has, the more likely they are to voice concerns to their project leader, thus facilitating the manager’s decision making process. However, the study also finds that project team members vary considerably in their willingness to act on available information. In particular, the study shows that the project leader’s open-mindedness plays a key role. That is, more information about a project’s flaw particularly enhances team members’willingness to voice concerns when they perceive their project leader to be open-minded. Second, those team members who are more pro-socially motivated also placed more emphasis on objective information when voicing concerns than less pro-socially motivated team members. For practicing managers, the important implication is not only that they should facilitate team members’ access to information about aspects indicating project performance (or potential flaws), but also that they should signal open-mindedness regarding the employees’ concerns. Finally, when assembling project teams, it can pay off to add team members who are known for their pro-social mindset and motivation – it is these team members who are most likely to approach a project leader with their concerns that the project may not meet its future goals.

 

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