Person:

Bernstein, Ethan

Using data from embedded participant-observers and a field experiment at the second largest mobile phone factory in the world, located in China, I theorize and test the implications of transparent organizational design on workers' productivity and organizational performance. Drawing from theory and research on learning and control, I introduce the notion of a transparency paradox, whereby maintaining observability of workers may counterintuitively reduce their performance by inducing those being observed to conceal their activities through codes and other costly means; conversely, creating zones of privacy may, under certain conditions, increase performance. Empirical evidence from the field shows that even a modest increase in group-level privacy sustainably and significantly improves line performance, while qualitative evidence suggests that privacy is important in supporting productive deviance, localized experimentation, distraction avoidance, and continuous improvement. I discuss implications of these results for theory on learning and control and suggest directions for future research.

Observation is key to management scholarship and practice. Yet a holistic view of its role in management has been elusive, in part due to shifting terminology. The current popularity of the term “transparency” provides the occasion for a thorough review, which finds (a) a shift in the object of observation from organizational outcomes to the detailed individual activities within them; (b) a shift from people observing the technology to technology observing people; and (c) a split in the field, with managers viewing observation almost entirely from the observer’s perspective, leaving the perspective of the observed to the realm of scholarly methodology courses and philosophical debates on privacy. I suggest how the literature on transparency and related literatures might be improved with research designed in light of these trends.