CAREER: Understanding workplace risk-taking behavior

Louisiana State University, Baton Rouge LA

Investigators

Abstract

Risk taking is quintessential for innovation, growth, and social change. In a future of work rife with uncertainty, there will be an increasing demand for employees who are willing to take risks for the benefit of their organization and its members. Risk taking, however, plays a double-edged role in organizational settings. Multiple corporate catastrophes, such as the financial crisis of 2008 and the Enron scandal, can be traced to reckless and unethical risky behaviors of bankers, investors, and accountants. Indeed, risk takers can be both assets and liabilities for their organization and the society. This project examines the impact of risk taking in work settings and explores how organizations can best identify and manage risk takers to leverage their appetite for risks toward achieving organizational and societal goals. Despite the significance of risk taking in organizational life, there is little research on how to best select, place, and manage risk takers at work to maximize organizational effectiveness. Research to date has primarily focused on the risk taking of executives, while less is known about how employee risk taking affects organizational outcomes. This project integrates economic, evolutionary, and psychological theories of risk to 1) examine the role of dispositional risk taking (i.e., risk propensity) on employee performance through longitudinal and multi-source survey studies; 2) understand the within-person dynamics of employee risk taking behaviors using daily-diary methods; and 3) develop a contextualized measure of workplace risk taking using a situational judgment test. Besides understanding who takes risks at work, the project also sheds light on employee behaviors through the lens of risk perceptions. Finally, this project develops a multi-disciplinary educational curriculum aimed at management, psychology, and human resource development students. Results from this project will advance the science of risk taking at work while providing industry and the public with a valid assessment of workplace employee risk taking. This award reflects NSF's statutory mission and has been deemed worthy of support through evaluation using the Foundation's intellectual merit and broader impacts review criteria.