Performance Spillovers in Ambidextrous Work Settings

It is challenging to design appropriate incentives for ambidextrous work settings in which individuals have to perform well on both exploitative routine tasks and explorative non-routine tasks simultaneously. The present study builds on Hecht et al. (2012) and examines spillovers from performance-based routine task incentives onto explorative non-routine task performance. We use a 2 x 2 between-subjects experimental design and manipulate the presence of performance-based routine task incentives (fix pay vs. piece-rate pay) and the temporal task relation (simultaneous vs. sequential). We expect that a (mis-)match between motivation and incentivization of routine tasks causes a (negative) positive spillover onto explorative non-routine task performance. We assume the (negative) positive spillover is driven by a more (negative) positive motivational state. Analyzing heterogeneous treatment effects, we find significant support for our hypotheses: First, for participants that are not that motivated to conduct the routine task, we detect a negative spillover from routine task incentives onto explorative non-routine task performance. Second, for participants that are motivated to conduct the routine task, we detect a positive spillover from routine task incentives onto explorative non-routine task performance. Consistent with extant research (Hecht et al., 2012) we observe the spillover effects only when tasks are conducted simultaneously. The findings have implications for senior managers, and they shed light on the complicated question of how to design incentive systems in ambidextrous work settings