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Effectiveness of performance appraisal: Evidence on the utilization criteria

Author

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  • Iqbal, Muhammad Zahid
  • Akbar, Saeed
  • Budhwar, Pawan
  • Shah, Syed Zulfiqar Ali

Abstract

This study examines the relationships between performance appraisal (PA) purposes and immediate and ultimate outcomes. Drawing upon expectancy theory and Greenberg's taxonomy, we explore the roles of multiple mediators as sets of person- and organization-referenced ratee reactions and reveal the multiple why-related aspects of the relationships between PA purposes and PA effectiveness. Our research is based on a questionnaire survey of 563 employees from the telecommunications sector of Pakistan. The results of structural equation modeling analysis suggest that individual-focused PA better serves the employee perspective, whereas position- and organization-focused PA better serves the organizational perspective. These findings indicate that inclusion of role definition and strategic purposes in the PA system is likely to render PA more effective and practical. The findings also corroborate that ratee reactions mediate the relationship between PA purposes and PA effectiveness, albeit to varying degrees. Our findings have theoretical and practical implications.

Suggested Citation

  • Iqbal, Muhammad Zahid & Akbar, Saeed & Budhwar, Pawan & Shah, Syed Zulfiqar Ali, 2019. "Effectiveness of performance appraisal: Evidence on the utilization criteria," Journal of Business Research, Elsevier, vol. 101(C), pages 285-299.
    • Handle: RePEc:eee:jbrese:v:101:y:2019:i:c:p:285-299
    DOI: 10.1016/j.jbusres.2019.04.035
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    Citations

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    Cited by:

    1. Mariana Lopes de Araújo & Lucas Soares Caldas & Bruna Stamm Barreto & Pedro Paulo Murce Menezes & Júlia Cássia dos Santos Silvério & Laís Campos Rodrigues & André Luiz Marques Serrano & Clóvis Neumann, 2024. "How to Evaluate the Effectiveness of Performance Management Systems? An Overview of the Literature and a Proposed Integrative Model," Administrative Sciences, MDPI, vol. 14(6), pages 1-21, June.
    2. Bei Lyu & Weilin Su & Qian Qi & Fujun Xiao, 2023. "The Influence of Performance Appraisal Justice on Employee Job Performance: A Dual Path Model," SAGE Open, , vol. 13(3), pages 21582440231, August.
    3. Lawrence Arokiasamy & Takemi Fujikawa & Shishi Kumar Piaralal & Thilageswary Arumugam, 2024. "Role of HRM Practices in Organization Performance: A Survey Approach," International Journal of Sociotechnology and Knowledge Development (IJSKD), IGI Global, vol. 16(1), pages 1-32, January.
    4. Mackey, Jeremy D., 2021. "Why and how predators pick prey: Followers’ personality and performance as predictors of destructive leadership," Journal of Business Research, Elsevier, vol. 130(C), pages 159-169.
    5. Zia Ullah & Naveed Ahmad & Miklas Scholz & Bilal Ahmed & Ilyas Ahmad & Muhammad Usman, 2021. "Perceived Accuracy of Electronic Performance Appraisal Systems: The Case of a Non-for-Profit Organization from an Emerging Economy," Sustainability, MDPI, vol. 13(4), pages 1-16, February.
    6. Shih-Hsien Tseng & Hsiu-Chuan Chen & Tien Son Nguyen, 2022. "Key Success Factors of Sustainable Organization for Traditional Manufacturing Industries: A Case Study in Taiwan," Mathematics, MDPI, vol. 10(22), pages 1-17, November.

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