When Does the Devil Make Work? An Empirical Study of the Impact of Workload on Worker Productivity

Loading...
Thumbnail Image
Penn collection
Operations, Information and Decisions Papers
Degree type
Discipline
Subject
econometrics
empirical study on staffing
worker productivity
business analytics
restaurant operations
behavioral operations management
quality/speed trade-off
Business
Business Administration, Management, and Operations
Business Analytics
Business and Corporate Communications
Business Intelligence
Human Resources Management
Labor Relations
Management Information Systems
Operations and Supply Chain Management
Organizational Behavior and Theory
Strategic Management Policy
Funder
Grant number
License
Copyright date
Distributor
Related resources
Author
Tan, Tom F
Netessine, Serguei
Contributor
Abstract

We analyze a large, detailed operational data set from a restaurant chain to shed new light on how workload (defined as the number of tables or diners that a server simultaneously handles) affects servers' performance (measured as sales and meal duration). We use an exogenous shock—the implementation of labor scheduling software—and time-lagged instrumental variables to disentangle the endogeneity between demand and supply in this setting. We show that servers strive to maximize sales and speed efforts simultaneously, depending on the relative values of sales and speed. As a result, we find that, when the overall workload is small, servers expend more and more sales efforts with the increase in workload at a cost of slower service speed. However, above a certain workload threshold, servers start to reduce their sales efforts and work more promptly with the further rise in workload. In the focal restaurant chain, we find that this saturation point is currently not reached and, counterintuitively, the chain can reduce the staffing level and achieve both significantly higher sales (an estimated 3% increase) and lower labor costs (an estimated 17% decrease).

Advisor
Date Range for Data Collection (Start Date)
Date Range for Data Collection (End Date)
Digital Object Identifier
Series name and number
Publication date
2014-06-01
Volume number
Issue number
Publisher
Publisher DOI
Journal Issue
Comments
Recommended citation
Collection