Setting the tone for the team: A multi‐level analysis of managerial control, peer control, and their consequences for job satisfaction and team performance

In this study, we develop a multi‐level theoretical framework linking antecedents and outcomes of peer control, defined as team members at the same hierarchical level noticing and responding to their peers’ behaviour or performance. Analysing multi‐level data from 356 volunteers and 58 regional teams in a non‐profit organization, we examine top‐down managerial controls as antecedents of lateral peer control, both directly (i.e., monitoring and responding directly to peers) and indirectly (i.e., gossiping about and avoiding underperforming peers), and peer control’s effects on individual‐ and team‐level outcomes. In line with our predictions, we find formal managerial control and clan control to be antecedents of peer control, albeit with differential effects on direct and indirect peer control. We also find a significant association between peer control and both individual‐level job satisfaction and team‐level performance, but again, with crucial differences between the two types of peer controls and the two outcomes. Our study contributes to the development of a better theoretical understanding of peer control, sheds light on inconsistent findings across prior studies, provides novel insights into how team leaders can influence team members’ individual satisfaction and team‐level performance via peer control, and reveals important trade‐offs with regards to peer control’s influence on individual‐ and team‐level outcomes.