The Impact of Information Technology Monitoring on Employee Theft and Productivity

Posted September 17 2013

hr-technologyEvery year, employee theft costs employers around $200 billion. A recent study investigated how firm investments in technology-based employee monitoring impacted both misconduct and productivity. The study focused on 392 casual-dining restaurants from 5 different firms that adopted a theft monitoring information technology (IT) product. To monitor theft, restaurants implemented NCR Restaurant Guard, 'an add-on to point-of-sale (POS) systems that utilizes proprietary algorithms to detect theft and fraud by restaurant workers.

The study found that the adoption of theft monitoring information technology can substantially impact both the productive and corrupt behaviors of employees. Their results also suggested that when management implemented increased monitoring under a pay for performance scheme, employees will redirect effort toward productivity because their incentives have been realigned. Additionally, they also found that the majority of improvement in organizational performance and productivity stems from the improved behavior of existing employees, not from the firing of those engaged in theft.

Surveillance has its time and place. But the best way to encourage trustworthy behavior is to show trust.

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