The Sequence Effect in Panel Decisions: Evidence from the Evaluation of Research and Development Projects

Paola Criscuolo (), Linus Dahlander (), Thorsten Grohsjean () and Ammon Salter ()
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Paola Criscuolo: Department of Management and Entrepreneurship, Imperial College Business School, South Kensington, London SW7 2AZ, United Kingdom
Linus Dahlander: ESMT Berlin, 10178 Berlin, Germany
Thorsten Grohsjean: Department of Management and Technology, Invernizzi Center for Research on Innovation, Organization, Strategy, and Entrepreneurship, Bocconi University, 20136 Milan, Italy
Ammon Salter: School of Management, University of Bath, Bath BA2 7AY, United Kingdom

Organization Science, 2021, vol. 32, issue 4, 987-1008

Abstract: We examine how groups fall prey to the sequence effect when they make choices based on informed assessments of complex situations, for example, when evaluating research and development (R&D) projects. The core argument is that the temporal sequence of selection matters because projects that appear in a sequence following a funded project are themselves less likely to receive funding. Building on the idea that selecting R&D projects is a demanding process that drains participants’ mental and emotional resources, we further theorize the moderating effect of the influence of the timing of the panel meeting on the sequence effect. We test these conjectures using a randomization in sequence order from several rounds of R&D project selection at a leading professional service firm. We find robust support for the existence of a sequence effect in R&D as well as for the moderating effect. We further explore different explanations for the sequence effect and how it passes from the individual to the panel. These findings have broader implications for the literature on innovation and search in general and on group decision making for R&D, specifically, as they suggest that a previously overlooked dimension affects selection outcomes.

Keywords: sequence effect; law of small numbers; gambler’s fallacy; contrast effect; quota model; R&D project selection; innovation; decision making; panel; professional service firm (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:inm:ororsc:v:32:y:2021:i:4:p:987-1008

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