People

The prior literature on role congruity theory has revolved around demographic-based expectations, emphasizing role incongruity derived from a mismatch between prescriptive expectations of distinct roles. In this study, we depart from this traditional focus on between-role incongruity and explore an alternative source of role incongruity by examining how language can trigger the within-role incongruity of function-based expectations. Through an analysis of conference call transcripts and contracts for 7,649 deals during 2003–2018, we show that the incongruity of function-based expectations manifested through the language of the CFO leads banks to employ more debt contract covenants. This takes place because such incongruity increases banks’ perceived hazards. In addition, by investigating the moderating effects of corresponding CEO language and media sentiment, we show how the social context and sentiment toward the firm weaken this incongruity effect. We discuss the theoretical implications of our study for future research on the sources of role incongruity and the antecedents of contract design.

Organizations frequently rely on peer performance ratings to capture employees’ unique and difficult to observe contributions at work. Though useful, peers exhibit meaningful variance in the accuracy and informational utility they offer about ratees. In this research, we develop and test theory which suggests that raters’ social network positions explains this variance in systematic ways. Drawing from information processing theory, we posit that members who occupy core (peripheral) positions in the network have greater (less) access to firsthand and secondhand performance information about ratees, which is in turn associated with more (less) accurate performance ratings. To overcome difficulties in obtaining a “true” performance score in interdependent field settings, we employ an external criterion comparison method to benchmark our arguments, such that larger validity coefficients between established predictors of performance (i.e., a ratee’s general mental ability [GMA] and conscientiousness) and peer performance ratings should reflect more (less) accurate ratings for core (peripheral) members. In Study 1, we use an organization-wide network in a technology startup company to examine the validity coefficient of a ratee’s GMA on performance as rated by central versus peripheral members. In Study 2, we attempt to replicate and extend Study 1’s conclusions in team networks using ratee conscientiousness as a benchmark indicator. Findings from both studies generally support the hypotheses that core network members provide distinct, and presumably more accurate, peer performance ratings than peripheral network members.

The article by Dr. Ning Li, Associate Professor at Tippie College of Business, The University of Iowa, and Dr. Helen Hailin Zhou, Assistant Professor in Management Strategy

The article by Dr. Helen Hailin Zhou, Assistant Professor in Management Strategy and Dr. Ning Li, Assocaite Professor at Tippie College of Business, The University of Iowa