Socialization Mechanisms and Goal Congruence
42 Pages Posted: 18 Aug 2013
Date Written: August 16, 2013
Goal congruence is the desired outcome of an effective management control system. Empirical research, though, often assumes the existence of goal congruence and instead attempts to establish relations between control and firm (or employee) performance. In a research setting where the firm does not rely on performance measures to motivate and direct employee behavior, we examine how socialization mechanisms (i.e., the beliefs system, mentoring, and peer pressure) influence employees’ perceptions of their work environment and goal congruence. We use survey data from 354 employees to estimate a structural equation model that provides evidence on the relations between socialization mechanisms, the perception of secure and stable work conditions, and goal congruence. We find that all three socialization practices are positively correlated with one another and thus work as a package of socialization controls. Our results show that a working environment employees believe offers them security and long-term stability is important to ensuring that their goals are aligned with the firm’s. Moreover, the extent to which top management communicates core values, supervisors engage in mentoring, and peers encourage and monitor one another, are important management controls since they help create a secure and stable work environment.
Keywords: goal congruence, management control, socialization mechanisms, beliefs, mentoring, peer pressure
JEL Classification: M40, L20
Suggested Citation: Suggested Citation