Chapter 103 Question ○93

Why do managers tend to overestimate the effectiveness of criticism and underestimate the role of praise? Stern managers always criticize employees when they see mistakes; but when employees do well, they are slow to praise them.On the contrary, honest managers are eager to praise, but later than to criticize.Which style is more effective? Since there is no right answer, new managers will mostly experiment first when developing the style that works best for them.But such experiments often come with preconceived biases.They lead many managers to conclude that praise is less effective and criticism is more effective.But the actual situation is not the case.Where did this prejudice come from?

The reason is again the statistical phenomenon that causes biennial syndrome to regress to the mean.Like baseball players, employees cannot maintain the same performance standards all the time.Sometimes their performance is higher than the long-term average, sometimes lower.Regardless of the feedback received from managers, an employee whose performance is below normal one week is likely to improve and return to a more normal performance the next week.Conversely, regardless of whether the boss praises it or not, if the employee performed above the standard one week, it is likely to return to the next week.

As a result, managers who are overly critical of employee mistakes can reverse subsequent performance improvements (where they would have been) and mistakenly believe that their own harsh criticism has had an effect.Conversely, managers who praise employees when they perform well mistakenly attribute the subsequent resurgence (which would have occurred) to their own permissive management style. Experiments have shown that, at least in some settings, an encouraging management style is more likely to elicit good performance from employees than a harshly critical one.Evidence of this kind is probably more reliable than casual impressions of bias due to regression to the mean.

As a last example in this chapter, the principle of cost-benefit can sometimes help us understand seemingly meaningless information.