Status-Driven Role Structures and Their Impact on Team Performance in Software Development Teams

In corporate organizations, group performance depends critically on effective knowledge sharing. Although many organizations rely on similar formal structures, such as three level hierarchies (executives, middle management, employees), they often differ in performance. This suggests that informal structures, rather than only formal ones, also shape how knowledge is shared. One key informal structure consists of social norms that reward informal status to individuals who share knowledge. Individuals gain or maintain status by strategically choosing with whom to share knowledge to signal competence. As a result, knowledge sharing is more likely along certain social relations than others. However, how different norms shape status-based incentives, and how these incentives influence knowledge-sharing patterns and eventually group performance, remains unclear. To address this gap, we develop a theoretical framework that formalizes status-based incentives as payoffs determined by differences between knowledge sharer and recipient in the formal hierarchy of the team. We identify three archetypal corporate norms and analyze how each generates distinct incentive structures. We use agent-based simulations to examine how these norms produce different patterns of knowledge sharing and associated levels of group performance. Using a 20-year dataset of almost 20,000 interactions among members of a proprietary software development team---all digitally recorded via the code repository---we examine which archetypal norm best captures observed knowledge-sharing patterns and how these patterns relate to group performance.