gThe juxtaposition of social surveillance controls with traditional organizational design components

This study investigates how the relatively contemporary phenomenon of social surveillance controls, such as the use of teams and managerial monitoring, affects the design of the firm's more traditional organizational architecture, which is classically defined to consist of three primary components: incentive compensation, the delegation of decision rights, and performance measurement. We find that vertical surveillance (i.e., high-level monitoring) substitutes for delegation while horizontal surveillance (i.e., teams) substitutes for incentives. We find that the allocation of decision rights is positively associated with the use of incentives and that the use of incentives and reliance on,output-based performance measures are complements. Overall, our-data support the general notion that there are complementarities and substitutes among and between social surveillance controls and traditional organizational design components. Our study has implications for managers and boards responsible for organizational design decisions at the departmental or smaller business unit level.