Accountability and managerial advice-taking: comparing human and algorithmic advisers

Abstract

Purpose Both the literature on advice-taking from humans and the literature on advice-taking from algorithms suggest that providing advice rationales—information explaining how an adviser arrived at a recommendation—increase advice-taking. We examine how accountability in the form of managers having to justify their judgments and decisions to superiors moderates this effect and whether the moderating effect is dependent on the adviser being a human or al algorithm. Design/methodology/approach We use an experiment, in which we manipulate the type of adviser (human vs algorithm), the presence of an advice rationale (present vs absent) accountability (low vs high), and measure the extent of advice-taking. Findings For human advisers, we find that receiving an advice rationale increases advice-taking more under high accountability than under low accountability. However, a significant three-way interaction suggests that this effect is less so when the adviser is an algorithm: the positive effect of an advice rationale on advice-taking from an algorithm is not moderated by accountability but consistently strong. Practical implications Our results emphasize the importance of providing advice rationales, especially when managers are operating under high accountability. Firms may consider the cost–benefit trade-off of providing advice rationales in the case of human advisers. In settings of low accountability, the benefits of providing an immediate advice rationale for the advisee may not outweigh the costs for the adviser. In the case of algorithmic advisers, providing an advice rationale is essential, regardless of the accountability under which a potential advice-taker operates. Originality/value We advance both the literature on advice-taking from humans and advice-taking from algorithms by showing how the effects of advice rationales are affected by the level of accountability, which is ubiquitous in the managerial context. Given that generating advice rationales can be costly and the potential negative effects of accountability, these insights are also of major importance to practitioners who need to consider the costs and benefits of organizational structures.