How Teams Achieve the Coveted State of “Group Flow”

The Employee-Employer Relationship Has Changed for the Worse

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By Nick Keppler

In one recent survey, 54 percent of hiring managers at technology companies said they expect layoffs in 2025 as more tasks are performed by AI. Although U.S. President Donald Trump’s tariff plans have been delayed and mitigated by a growing list of exemptions and ongoing negotiations between the U.S. and targeted countries, tariff-related price uncertainty and shipment delays have created a wave of stagflation anxiety and recession fears in the U.S., which could spur companies to slash jobs, which in turn would worsen the growing economic crisis.

Academy of Management Scholar Herman Aguinis of the George Washington University School of Business said that a few decades of mass layoffs and wages not keeping up with inflation have fundamentally changed the employee-employer relationship in the U.S. When looking to improve the bottom line, companies often eye trimming payroll because it is such a huge expense.

“For many organizations, the lion’s share of the operating budget is payroll, two-thirds or more,” Aguinis said. “It could be 80 percent or 85 percent.”

The cost-cutting approach that sees employees as expenses more than assets can be shortsighted, he said. Moreover, many companies lack an effective performance management system and, in mass layoffs, cut high-performing and low-performing employees alike.

Since the 1990s, when companies, particularly in the tech sector, regularly pruned their workforce as a cost-saving measure, despite a booming economy, much of the workforce has begrudgingly come to accept that they can lose their job in a corporate reshuffling, regardless of their job performance. Aguinis said this has damaged the psychological contract between employee and employer that engendered mutual loyalty.

“In the post-World War II era, it was understood that if you do your job, you will not be fired, and you will also not leave, even if they pay you a little more somewhere else,” he said. “We had this implicit loyalty in the old psychological contract.”

Under the new employment-at-will standard, there is no psychological contract, and most employees are always tabulating their value and waiting for the ax to fall.

“If you’re not adding value to your company, they can fire you at any time,” Aguinis said. “On the flip side of the coin, if you’re a star performer and adding a lot of value, you get offers, and you can just go to a new employer willing to pay you more overnight, and there’s no loyalty from you to the company.”

As economic anxiety causes people to rethink their employment, companies should do more to identify and retain their most valuable players, Aguinis said.

“You have to implement a very good performance-management system so you know who your highest-performing people are, because they can leave at any time—and if they leave, it will be tough to replace them,” he said. “For example, in May 2025, Google announced they are revamping the performance management and compensation system so that the total compensation pool will remain budget-neutral, but it will include larger rewards for top performers and smaller bonuses for lower-rated individuals.”

This awareness of the importance of adding value also cycles into the advice Aguinis gives MBA graduates. Instead of taking the job offer that pays the best, he said to look for career-development opportunities.

“Pick the employer that gives you the most amount of learning opportunities, because that is an investment in your future, not just in the short term,” Aguinis said.

Research Findings Are Not Reaching Business Leaders

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By Nick Keppler

There are now about 400 journals for management as an academic field, producing about 12,000 published articles a year in total. However, top decision-makers rarely learn anything from them, said Academy of Management Scholar Herman Aguinis of the George Washington University School of Business.

“Many of us are concerned that the research we do is not being used to the extent that we would like, and it’s called a research-practice gap,” Aguinis said. “Also, there’s a research-policy gap,” stemming from political leaders’ lack of familiarity with research produced in the field of management.

This gap is particularly frustrating, said Aguinis, because scholars on management and organizations have produced a wealth of scientifically sound research on issues that have dominated the news in 2025, including the downsizing of the federal government, the measurement of job performance, discrimination and diversity, equity, and inclusion policies, and the implementation of AI in workplaces.

“If you want to build a bridge, you will talk to the top engineers, but management scholars are not consulted with the same regularity,” said Aguinis.

This is not entirely the fault of those who could potentially benefit from our research, Aguinis added. Academic journals are often insular and publish articles that only make small contributions to our understanding of critical organizational phenomena. Also, the compensation and reward systems motivate academics to write mainly for other academics, not managers, business leaders, and decision-makers.

“For several reasons, much of our research is not aimed at affecting practice,” Aguinis said. “If you read the typical article of, let’s say, 20 pages, you may find one or two paragraphs at the end saying ‘implications for practice.’”

The research is not lost on everyone. A small number of elite companies look to academia to improve performance. Google is well-known for hiring Ph.D. holders, not just for computer-science roles but also for management and creative jobs. Marriott is a sponsor of doctoral development programs.

These companies reap the benefit in reputation, said Aguinis, often appearing in lists such as Fortune Magazine’s “Best Companies to Work For” series.

“All of these companies, all of them, employ Ph.D.s who actually read the research, and they try to implement leadership strategies and management practices that are consistent with what research says aligns with best-practice evidence as published in scholarly journals,” he said.

Why Success Can Be the Enemy of Innovation in the Age of AI

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By Jason Collins

A new Pew Research Center report reveals that public optimism remains low regarding the potential impact of AI in the workplace. However, refusing to work with new technologies can cause even the largest organizations to fail as this technology changes the game across many industries.

Academy of Management Scholar Wendy Smith of the University of Delaware reveals that it isn’t the small businesses that are most at risk, but rather larger organizations that choose to rely on what they know works. Smith calls this the paradox of success.

“The companies who are at the top of their market have the most to lose and therefore don’t want to take risks and thus are the most entrenched in what they already do,” Smith said. “Researchers call this the ‘paradox of success’ where successful companies are the ones that fail to adopt new technologies and innovation.”

Because smaller organizations don’t have this burden, they have nothing keeping them from trying new things and adopting new technologies such as AI and robotic process automation. History shows us that success can be an enemy of innovation. Smith draws parallels to brands such as Kodak and Polaroid, which failed to make the digital photography transition.

“BlackBerry was this amazing early force of the smartphone but could not compete when brands like Apple came into the market with updated technologies,” Smith said. “Blockbuster Video couldn’t make the transition from VHS tapes and DVDs to streaming when Netflix then took over.

“So, we see that story happen again and again and again,” she said.

If the past has taught us anything, it is that relying on past success without monitoring new technologies, tracking consumers’ preferences, and cultivating boldness in strategic planning prevents innovation.

“I think we’re going to see the same thing now,” Smith said. “And so there is wisdom in ‘Don’t throw out the baby with the bathwater.’

“It’s totally new technology, but leaders should be learning from history what it means to innovate within an existing company,” she said.

The New Reality: Leaders Have Less Control, Need More Courage

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By Jason Collins

For decades, the prevailing wisdom for business leaders was to stay out of politics. Neutrality was considered the safest, most responsible stance for corporate executives and board members to take. But today that approach is increasingly untenable. From the COIVID-19 pandemic to intensifying political polarization and controversy, leaders now find themselves at the center of public debates whether they choose to engage with them or not.

For leaders, silence is a statement, and political neutrality is no longer a viable option, according to Academy of Management Scholar Wendy Smith of the University of Delaware.

“It used to be that there were checks and balances in the U.S. government,” Smith said. “The market was separate from the state, or companies were separate from the government, and that is no longer the case.”

To survive and thrive in this era when economics and politics collide to sow chaos, Smith said that leaders should “talk about strategizing as a verb rather than having a strategy.” For Smith, this means considering “the conditions that we need to bring a team together to be agile and moving, even as we need to communicate out to our people some sense of security.”

Strategic decisions from supply-chain choices to remote, hybrid, or return-to-office work policies have become flashpoints in boardroom and C-suite conversations and political discourse. Leaders now must navigate complex social, economic, and political terrains, speak out on pressing issues, and align their actions with values that resonate with stakeholders—employees, shareholders, customers, and communities alike.

Companies’ leaders have had to deal with uncertainties for a long time, but Smith said many of their strategies and their organization’s systems are antiquated. According to Smith, nowadays leaders are learning that they need to “communicate to their people, optimize their processes, and cultivate openness in their conversations, but not pretend that there’s certainty of what the future will bring, because that’s just false hope.”

Smith acknowledged that leaders are faced with unique challenges in this current political landscape characterized by dissention, frustration, anger, and unpredictability, making it difficult to navigate socioeconomic volatility.

“One of the consequences of this highly polarized world is that leaders, because of the polarization, are being attacked for polarizing positions,” Smith said.

In this current era, leadership is less about having definitive answers and more about asking incisive questions, listening to a range of perspectives, evaluating various responses to difficult circumstances and controversial issues through an ethical lens, and having the courage of one’s convictions.

“We want leaders who are competent and courageous, not stepping away from that responsibility to take a stand and speak up for what’s right because it is so risky,” Smith said.

How Looming Stagflation May Affect Pay

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By Paul Friedman

At a time when some forecasts predict continuing or worsening inflation or stagflation and possibly a recession, pay transparency adds to the pressure on organizations’ decision-makers.

Peter Bamberger of Tel Aviv University, an Academy of Management scholar who published a book based on his research on pay transparency, said managers will need to build systems of compensation that are more justifiable and understandable to employees.

“The first step with pay transparency is not necessarily to disclose pay levels of one employee or another employee, but rather to disclose how pay is determined in the organization,” Bamberger said. “Most employees have no understanding whatsoever how their pay is determined in the organization and how other people’s pay is determined in the organization.

“Simply understanding pay processes and procedures, all the evidence suggests, has beneficial effects for both employees and employers with very few, if any, side effects—except that employers have to work harder to build these equitable and fair systems.”

Bamberger said pay transparency is always problematic for decision-makers.

“No one wants their decisions to be transparent to other people—transparency is great when we are the observers, but when we’re the observed, it’s a terrible thing,” Bamberger said. “It comes with potentially unintended negative consequences, especially when you have to think about what happens when people see that they are paid less than other people.

“It becomes problematic for the ones making the decisions, and it can be problematic for the organization,” he said. “So there are complications with pay transparency; there’s no question about it.”

Still, Bamberger said he believes that “sunshine is the best antiseptic,” and pay transparency can produce surprising positive results.

“What the evidence shows is that most employees underestimate how much their superiors are making, and when you think about that, it generates a tendency of individuals to think that they’ll do better by leaving their current organization,”

Bamberger said. “The grass is always greener; if I want a pay increase, I have to go outside, and that movement has costs to the current employer.

“So there’s merit, potentially, in letting people see what the potential income might be for moving up within the organization,” he said.

“I think organizations that are forced to be more accountable and hence build more effective pay systems—more explainable and justifiable pay systems—ultimately enhance the quality of the human capital they can bring in and hold to enhance their competitiveness, which becomes really important in a period of stagflation.”

Everyone Will Suffer in the Wake of Trump Administration’s Research Cuts

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By Paul Friedman

This year, the Trump administration has fired many government researchers, canceled scientific and medical research grants, and targeted leading universities, including Harvard, with debilitating funding freezes. Fear of reprisal has caused many scientists, doctors, professors, and university administrators to opt for silence instead of speaking up to defend the research that is getting the ox.

Academy of Management (AOM) Scholar Peter Bamberger of Tel Aviv University says much of the research produced by him and his colleagues, including many AOM members, has a day-to-day impact on industry practitioners, including organizational leaders and managers. Cuts in federal funding for research will have a negative impact on industry, as well as researchers, colleges and universities, and other research institutions.

“What we publish in our primary journals have to be both theoretically important and have practical relevance,” Bamberger said. “It’s got to be interesting from a theoretical perspective and intellectual perspective, and it’s got to have some sort of surprising element—going against conventional wisdom—but it also has to translate that surprising finding into something that managers can do something about.

“And there are thousands of organizational consultants who read the findings published in our journals and then translate that into actual practice in organizations,” he said.

Bamberger points out that a great deal of research is specifically aimed at examining current practices by managers and their efficacy. Recently, he published a study of the managerial approach called design thinking, which focuses on understanding clients’ needs and designing innovative solutions.

“Design thinking has been around for about 10 years,” Bamberger said. “It’s an approach to create more innovative ways of boosting learning and finding innovative solutions to common problems or sometimes even really wicked problems.

“It became a fad and a lot of organizations adopted it, but no one ever bothered to actually assess whether or not it has an impact and whether this impact is any greater than other types of learning-oriented interventions, like team building,” he said.

Bamberger and research colleagues designed a field experiment to test the impact of design thinking as a team learning intervention. They compared over time what happens in terms of the efficiency and productivity of teams using different interventions.

“Is design thinking more efficacious than an alternative?” Bamberger said. “And we found out that in fact it is, and we actually demonstrate the mechanism by which it operates and why it’s more effective than other mechanisms.

“So these types of practical implications are useful to managers and to the extent that we don’t have funding necessary to do this type of research, everybody suffers,” he said.

Why We Love Time-Travel Tales

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By Daniel Butcher

People love stories that involve time travel, from books such as The Time Machine by H.G. Wells, A Wrinkle in Time by Madeleine L’Engle, and the Outlander series by Diana Gabaldon (adapted into a TV series) and shows such as Doctor Who and Quantum Leap to comedy movies such as Groundhog Day, Bill & Ted’s Excellent Adventure, and Hot Tub Time Machine and action/adventure films such as the Back to the Future and Terminator series.

What’s so universally compelling about the concept?

Academy of Management Scholar Abbie Shipp of Texas Christian University said that the appeal of time-travel stories is that people often imagine what it would be like to travel backward and forward in time.

“We live in any given moment, but in those moments as we mentally time travel, we can remember select things, we can forecast things, and so we can create whatever story we want,” Shipp said. “When we see it in movie or show form, it fascinates us to be able to move into the future and see, ‘How did that play out?’—there’s a little bit of certainty that comes with that, so that’s one element.

“Another part of that is that we forget how things change,” she said. “For example, we assume, ‘If I am in an accident and suffer an injury and I lose the use of my legs, I would be so unhappy,’ and there’s a lot of research on this; yet we know that people have happiness set points.

“We forget the resilience that we have over time.”

Popular fantasy

“I was just thinking about this today in terms of the weather,” Shipp said. “We’re having this really weird cold snap in Texas, and so, of course, my brain is thinking, ‘Well, if this is what the weather is going to be from now on, I’m going to move someplace else.’

“But that thought assumes this experience would be the same in another 10 years, rather than be temporary or change in another way,” she said. “What do I know about what the future holds?

“Some of those time-travel films get us thinking about the elements we’ve forgotten about the past or what might be in the future, so it’s as much a fantasy as it gives us something to sink our teeth into when we think about what’s continuous versus what’s changing.”

A sample of Shipp’s AOM research findings:

• Subjective Time: What It Is and Why It Matters at Work
• Paths to Retaining Employees Who Go the Extra Mile

What to Do When Your Boss Asks You to Work Late

By Daniel Butcher

You recently started a new job and your boss asks you to work late. Do you say yes, do you try to come up with a compromise, or do you say, “no way!”?

Academy of Management Scholar Abbie Shipp of Texas Christian University, who coauthored an Academy of Management Review article related to this topic with TCU colleague Hettie Richardson, said that when she had recently begun a new job as an assistant professor, there was an important meeting scheduled from five to nine p.m.

“I said, ‘A work meeting scheduled for after most people have left? What are you doing? I have to get home and take care of my son,’ but to this group, that was just normal because they wanted the privacy for the meeting’s sensitive topic,” Shipp said.

“When we get in situations like these, we have choices—we can either just go to the meeting deliberately and entrain to that schedule, or maybe we could passively push back and say, ‘I’ll be there, but I’m only going to stay from five to seven,’ or we could actively resist and say, ‘This isn’t right; this disadvantages people who don’t want to work in the evenings so I’m not going,’” she said. “Yet there are different outcomes that can happen in response to that decision.

“Sometimes it can be good because you may resist a meeting that others also think is mistimed—but other times you may be viewed as a rebel who is unwilling to adapt your schedule.”

Beyond meetings, Shipp said that there are other examples where it isn’t a simple choice between full compliance versus resistance.

“There are times when your preferred timing doesn’t match the situation, but you respond by creating an even more strict handling of time,” Shipp said. “Maybe you’re in an environment that doesn’t give you any structure about when and where to work but only evaluates your outcomes, given that different people experience time individually, they may each put their own structure in place, and that may further inform what happens at the team or the organizational level.

“Because individuals have views of time or ‘temporal schemata’ for how they interpret their schedules, they view the world through this temporal lens,” she said. “We each have these temporal schemata based on childhood and early work experiences, and that lens is how we each think about time and use time individually.

“We can’t assume that people will just naturally entrain to team or organizational schedules; we really have to look at each individual and see if there’s more going on behind the scenes.”

A sample of Shipp’s AOM research findings:

• Subjective Time: What It Is and Why It Matters at Work
• Paths to Retaining Employees Who Go the Extra Mile

When It’s Time to Look for a New Job

By Daniel Butcher

Sometimes it makes sense to say “This too shall pass” and weather the storm at work. In other cases, it’s best to jump ship.

Academy of Management Scholar Abbie Shipp of Texas Christian University, who coauthored an Academy of Management Review article on how people craft career narratives that affect how they fit in their current organization with Karen Jansen of North Carolina State University, said few jobs are forever.

“You thought you were going to stay here forever, and then your boss suddenly leaves, and you get a horrible boss,” Shipp said. “That’s a big event in your story, and how well you fit now has changed, so in response to the question ‘Am I going to stay here?’ is now very different.

“The fit literature had not addressed that question of change, so we have done some additional work to really explore what that means; we can’t just ask people, ‘Do you fit?’ at a moment in time to get the whole story,” she said. “You and I might report the same numerical number of job satisfaction on a questionnaire, but if the trajectory you’re expecting is going down and the trajectory I’m expecting is going up, I’m going to be super happy to stay, whereas you’re going to be planning a departure—yet, on the engagement survey, it will look exactly the same.

“It’s really about bringing in that temporal context.”

It’s easy to stagnate in a job even after the situation changes for the worse due to inertia. Employees shouldn’t be afraid to examine their changing work environment and make a call whether it still makes sense to be loyal to their employer. As for bosses, they need to actively try to boost morale after a period of more changes than usual.

“What it means for leaders is: You have to ask people, ‘What’s your story? Where have you been? Where are you going, and how does that provide an incentive for you to stay here, at least for the time being?” Shipp said. “We call it temporal baggage.

“When you come to an organization, you bring the temporal baggage of the past and the future, which is, ‘Where have you been before, and what do you expect if you’re going to stay here?’ and we have to understand that whole story,” she said.

“We ask about fit in the middle of things at one point in time, but we need to understand that whole story, and we have to keep asking, because it will naturally change as personal situations or work events change.”

A sample of Shipp’s AOM research findings:

• Subjective Time: What It Is and Why It Matters at Work
• Paths to Retaining Employees Who Go the Extra Mile

Understanding Time to Manage It Better

By Daniel Butcher

Time flies when you’re having fun or in the zone at work, but it crawls when you’re in pain or doing a boring task.

Academy of Management Scholar Abbie Shipp of Texas Christian University, who coauthored an Academy of Management Annals article on that topic with Karen Jansen of North Carolina State University, said that a key element of subjective time is people’s interpretation and perception of time itself.

“Working on the expense report, even 15 minutes probably feels like forever versus 15 minutes in a crisis situation feels like a blink of an eye,” Shipp said. “There are different ways in which we perceive time itself, the units of time, and that shapes how we structure our time.

“That could be things like deadlines—say you asked me, ‘Hey, can you get this to me by Thursday?’” she said. “That may seem like a very long deadline to you, but if I have a very busy week, maybe that feels like that’s way too soon.

“It has implications for how and when we work, especially how we work with each other.”

In Shipp’s and her colleagues’ research on different elements of subjective time, they looked at all the different ways in which people have studied time, and which aspects of it scientists haven’t studied. People who take time to examine how they perceive and interpret time may be able to improve their time management.

“We found was there are many gaps, both in how researchers and practitioners look at time,” Shipp said. “We found many ways in which you can better use your time if you think about it subjectively and not just objectively.”

A sample of Shipp’s AOM research findings:

• Subjective Time: What It Is and Why It Matters at Work
• Paths to Retaining Employees Who Go the Extra Mile