Effects of relative performance feedback: A quasi-experiment in collaboration with a Norwegian insurance company

Abstract

While there exists extensive research exploring the effects of relative performance feedback, there is limited evidence from experiments in the field, and the emotional responses of agents have been widely neglected. This paper explores how relative performance feedback affects performance, stress, and job satisfaction. We have studied the effects through a quasi-experiment with field data, in which we collaborated with a large insurance company. We provided the employees with weekly relative performance feedback. Further, their levels of stress and job satisfaction were measured through a questionnaire before and after the experiment. We show that implementing relative performance feedback can hurt performance. However, our results indicate that stress and job satisfaction may be positively affected by providing employees with feedback relative to others. Although the study is limited, mainly due to our sample size, it can provide valuable insight into how relative performance feedback affects employees and the workplace. An implication of our work could be that managers can utilize relative performance feedback to affect not only performance but also the emotional state of mind of employees.