Civil rights leader Bayard Rustin(left), who is believed to have coined the phrase, "Speak truth to power." (Source: Wikimedia Commons)
Ideas for Leaders #521

Candid Feedback Keeps Power-holders Accountable

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Key Concept

Those in positions of power have control over an organization’s allocation of scarce resources. But are subordinates as powerless as they think? New research shows that candid feedback from subordinates can compel power-holders to be fairer and less self-serving in their allocation decisions.

Idea Summary

Every organization has finite resources, starting with compensation, budgets and expense accounts, as well as high quality assignments, accounts or customers and even office space. The people who control the allocation of these resources have a great deal of power — and research shows that they use this power to make decisions that are in their self-interest. The subordinates who must accept the decisions of the allocators, on the other hand, have little or no power.

That is, at least, the traditional view of power in organizations. In this view, the only limit to power comes from self-regulation — that is, power-holders deciding for themselves to put the interests of the group or of others above their own self-interests. Past research has looked at contextual factors that might catalyse this self-regulation and thus help control the self-interested behaviour of those with power. The general conclusion, however, is rather pessimistic: those with power tend to act more in their self-interest over time. Power corrupts, and absolute power corrupts absolutely, as the familiar old saw declares.

However, the traditional view of power as unidirectional is too simplistic, according to a team of researchers from the Bocconi School of Management in Italy, Singapore Management University and London Business School. In fact, one of the contextual factors that can influence the self-regulation of those in power, these researchers argue, relates to the way in which subordinates react to the exercise of power. In sum, subordinates can themselves exercise some power through their reactions to the decisions of the power-holders, specifically in whether they offer ‘candid’ feedback or ‘compliant’ feedback.

Subordinates who offer candid feedback give their honest opinion, either negative or positive, about the allocation decisions of those in power. In other words, to use another familiar phrase, they “speak truth to power.”

Subordinates who offer compliant feedback, on the other hand, always declare their full support of the decisions of the powerful, whether they believe what they are saying or not. Thus, decision-makers consistently hear positive feedback of their decisions.

Using a multi-round, multi-party dictator game that allowed them to manipulate independent variables, the research team empirically demonstrated the direct link between feedback from subordinates and how power-holders allocated scarce resources. Specifically, the research reveals that:

  1. Power-holders who receive candid feedback about their allocation decisions make less self-interested decisions, on average, than those who receive only compliant feedback.
  2. Candid feedback will change power-holders’ next decisions, depending on whether that feedback is positive or negative. After receiving positive feedback from subordinates, the next allocation decisions of power-holders will be more self-interested; negative feedback, on the other hand, will lead to less self-interested decisions. The research thus confirmed that power-holders use feedback as a guide to regulate their behaviour. Positive feedback was a license to take more in their next allocation. With negative feedback, however, power-holders felt that they had to compensate for their previous self-interested behaviour and be more generous.
  3. Power-holders who continually receive compliant feedback make increasingly self-interested decisions over time. Compliant feedback, in other words, launches power-holders on the slippery slope of self-interest.
  4. Guilt plays a mediating role. Power-holders will feel more guilty after receiving negative feedback, and subsequently make less self-interested allocation decisions. The reverse holds true as well: power-holders will feel less guilty after receiving positive feedback, leading to more self-interested decisions.

Business Application

The allocation of scarce resources is at the heart of many management decisions. The decision-making process may seem to be a one-way process: managers make the decisions and subordinates accept them. The research shows, however, that in theory subordinates can influence management decisions, depending on whether they are candid or not in response to the decisions. Applying the theory to real situations, however, may be more complicated as subordinates must consider the potential for retribution or other consequences that might stem from their candid expressions of dissatisfaction.

On the other hand, organizations would benefit from preventing increasingly self-interested behaviour from their managers at the expense of subordinates. First, such self-interested behaviour may not be in the best interest of the organization; second, long-term frustration and disappointment from subordinates can lead to morale and productivity problems.

The solution is to build channels through which negative feedback can flow back to power-holders without risk to subordinates. These channels could include some kind of mediator or facilitator (an employee representative, for example), or a process that ensures the anonymity of the subordinate.

Speaking truth to power keeps power-holders from abusing their power and keeps subordinates from accumulating resentment. It is up to executives and governance functions to ensure that candid feedback is possible in their organizations.

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Authors

Institutions

Source

Idea conceived

  • March 2015

Idea posted

  • May 2015

DOI number

10.13007/521

Subject

Real Time Analytics