Tournament Incentives in Flat Agile Teams: Code Output and Developer Retention Effects

Abstract

This paper examines the impact of tournament-based incentives on both output in terms of code production and developer retention in flat agile teams, where employees are organized into self-managing teams, and the best employees are promoted. The study examines the effect of competition-based rewards that may be used to leverage performance and loyalty among developers in an organization that has low ordered structure. It was an observational study which was done in 12 agile teams at a technology company over a period of six months. They used the mixed-methods approach as the research methodology; the quantitative part of the mixed-methods approach offers the number of the code contributions (lines of code, frequency of the commits, the number of closed pull requests), whereas the qualitative part is the interview reaction to the questionnaire and measures the motivation level and job satisfaction. The sample used in the research is 180 developers on the basis of GitHub repositories and company surveys. The findings indicated that code production by the developers who received the tournament incentives increased by 24 percent when compared to a control sample. Retention rates were high when the incentives were coupled with some opportunities of career development based on the long term perspective which suggests the emphasis on balanced system of incentives. It is concluded that incentives through a tournament structure can increase the outputs of the code but likely harm retention unless balancing elements of career growth are also present. It should be noted that little research has been conducted about the ideal mix of short term and long term incentives to effect the best performance and loyalty in flat agile teams and hence future research should be based on the same.