The Value of Leadership: Evidence from a Large-Scale Field Experiment

Wed, 06/08/2022 - 12:00 / 13:00

401, Viale Romania

Speaker: Florian Englmaier , LMU Munich

(Florian Englmaier, Stefan Grimm, Dominik Grothe, David Schindler, and Simeon Schudy)

Abstract

Companies increasingly make use of team-based organizational structures. To foster performance in these settings, scholars and practitioners alike have emphasized the potential of leadership. However, the causal impact of leadership is difficult to identify since in agile and cross-functional teams leadership is often determined endogenously. In a large-scale natural field experiment (1,273 participants, 281 teams), we randomly encourage teams to select a leader before performing a complex non-routine, analytical task. This encouragement substantially increases the fraction of teams completing the task and makes successful teams faster. Choosing a leader also improves team organization, without reducing the originality of solutions.