Monitoring within the Firm and Manager Relations

Many managers face the problem of employee assessment. Face to face meetings are the only source of basic information concerning employee activity and productivity. This unavoidable situation creates an opening for dishonest and misleading behavior whereby employees invest in 'manager relations' and misrepresent their actual contribution to total output. Furthermore, employees who have an advantage in creating favorable 'manager relations' force others who are less accomplished in creating 'manager relations' to invest time in this activity. Their purpose being to correct unjust income distribution. However, these activities lead to a reduction in productivity and consequently to a loss of total production and income.