Learning to behave badly: performance feedback and illegal organizational action

Abstract

Two perspectives predict how organizational performance influences illegal action. First, poor performance creates tension, leading decision makers to repair the gap through any means necessary. However, strong performance also bolsters risky behavior, possibly leading to violations. To integrate these perspectives, I suggest that performance evaluation provides only the motive to commit illegal action and that decision makers also require an opportunity to do so. I extend organizational learning theory by suggesting that managers in organizations performing far from expectations may evaluate information about the potential success of illegal acts, and I examine whether they use this information to time violations.

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