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Trang 3APPRAISAL SATISFACTION IN A PUBLIC HEALTH AGENCY
A Dissertation
Presented in Partial Fulfillment of the Requirements for the
Trang 4UMI Number: 9989916
Copyright 2001 by Morgan, Barbara Ann
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Trang 5Authorization to Submit Dissertation
This dissertation af Barbara A Morgan, submitted for the degree of Doctor of Philosophy with 2 major in Education and titled “Supervisor’s Management Style and Employee
Performance Appraisal Satisfaction in a Public Health Agency,” kes been reviewed in final form Permission, ss indicated by the signatures and dates given below, is sow granted to submit final copies to the College of Graduate Studies for approval
Major Professor Mates: J1 Date_G- a5 00
Trang 6Bi
ABSTRACT
The purpose of this research was to examine the relationship between perceived supervisor management style and employee performance appraisal satisfaction This study also examined and assessed the possible moderating effects of the management style rating, quality of the relationship between supervisor and subordinates, duration of supervisor/subordinate
relationship, classification level (supervisor versus non-supervisor), performance rating, and/or age, on employee appraisal satisfaction
The primary participants of this study were a sample self-selected from the population of permanent, classified employees (supervisors and non-supervisors) in seven public health
districts in the Northwest A one-way analysis of variance was performed and clearly demonstrated statistically significant differences among the management style groups, in relation to the dependent variable, appraisal satisfaction A Tukey’s HSD test followed and revealed significant differences between the exploitive/authoritative style versus consultative style and participative supervisor management styles Supervisors who use a
benevolent/authoritative style were not significantly different ftom the exploitive supervisors Benevolent/authoritative supervisors were significantly different from the consultative and participative supervisors Consultative supervisors were not significantly different from the participative supervisor grouping These findings support Likert’s Leadership theory
Multiple regression was conducted to assess the possible moderating effects of the
Trang 7classification level (supervisor versus non-supervisor), performance rating, and age Findings from the regression analysis indicated that management style and quality of relationship were significant at the p< 05 alpha level The model explained approximately 8% of the variance
Based on a review of the performance appraisal literature, it was expected that employees who perceive their supervisors as having a participative management style would have higher employee appraisal satisfaction The results of this study supported this premise, as well as the findings of Thompson’s 1998 study Therefore, there are implications for organizations to invest in assessment of management style, participative coaching training for supervisors and climate assessment to ensure the culture of the organization encourages and rewards
Trang 8ACKNOWLEDGMENTS
I gratefully acknowledge those individuals who helped me make the completion of this
doctoral degree possible
First, I thank Professor Michael E Tomlin for his advice and assistance as my advisor and major professor [ respect and admire his knowledge of personnel, as well as his excellent teaching and research abilities His guidance was invaluable throughout the various stages of this work Second, I am indebted to Professor Carolyn M Keeler for her willingness to play a crucial role on my committee and for her expertise in research design Her suggestions made for a more comprehensive study Third, I appreciate committee members Professors Baiym Yang and W David Patton, who provided expertise in the data analysis, as well as took the time to discuss current developments in the performance appraisal literature
I sincerely thank my Mom and Dad who continually offered their love, support,
encouragement and friendship throughout the pursuit of my doctoral degree They made me believe I could achieve my dreams and reach for the stars Thanks for instillmg in me a love of learning
Last, but certainly not least, [ thank my husband Chip, who provided the light at the end of
Trang 9AUTHORIZATION TO SUBMIT DISSERTATION ABSTRACT ACKNOWLEDGMENTS TABLE OF CONTENTS LIST OF TABLES LIST OF FIGURES CHAPTER I: Introduction and Problem Statement Introduction
Background of the Problem
Statement of the Problem Theoretical Perspective Questions and Hypotheses Definitions
Limitations and Delimitations Significance of the Study Summary
CHAPTER II Review of the Literature Introduction
Performance Appraisal Research
Public Sector Performance Management
Trang 10CHAPTER Ii
CHAPTER IV
Dissatisfaction and Ineffectiveness of Appraisal Systems
Appraisal Satisfaction
Management Style and Performance Appraisals Assessment of Management Style
Trang 11Figure 1 “Management Style” Summary CHAPTER V Summary, Conclusions and Recommendations Introduction Summary Conclusions Recommendations Implications for Future Research REFERENCES
APPENDIX A “Performance Appraisal Survey Letter” APPENDIX B “Letter of Support”
APPENDIX C “Performance Appraisal Satisfaction Survey”
APPENDIX D “Survey Lottery Form” APPENDIX E “Survey Correspondence”
APPENDIX F “SB1228 Fact Sheet/Action List”
Trang 12LIST OF TABLES
Table 1 “Demographic and Descriptive Variables” Table 2 “District Breakout of Total Participants” Table 3 “Position Classification Level”
Table 4 “Current Supervisor Conducts Appraisal”
Table 5 “Years With Current Supervisor” Table 6 “Overall Summary Rating”
Table 7 “Supervisor Management Style for Sample”
Table 8 “Management Style - Supervisors and Non-Supervisors” Table 9 “Management Style by District”
Table 10 “Quality of Relationship - Sample”
Table 11 “Quality of Relationship - Supervisors and Non-Supervisors” Table 12 “Quality of Relationship - District”
Table 13 “Appraisal Satisfaction - Sample”
Table 14 “Appraisal Satisfaction - Supervisors and Non-Supervisors”
Table 15 “Appraisal Satisfaction - District” Table 16 “Management Style Means” Table 17 “Management Style - ANOVA” Table 18 “Tukey’s Multiple Comparisons”
Table 19 “Regression Model Summary” Table 20 “Correlation Matrix”
Trang 14CHAPTER 1: INTRODUCTION AND PROBLEM STATEMENT
Introduction
Many organizations in the United States, both public and private, consider the fair and accurate appraisal of employees to be a critical human resource management fimction Latham and Wexley (1982) identified selection, appraisal, training and motivation as the four key systems necessary for insuring the proper management of an organization’s human resources Of these four, they suggest that the performance appraisal is the most important because it is
the prerequisite for establishment of the other three Proponents of performance appraisals claim they serve a critical function for organizations because they can enhance productivity by identifying high, medium and low performers, mitigate conflict, and at the same time can target employee development needs (Bernardin and Beatty, 1984; Daley, 1991; Latham and Wexley, 1982; Lovrich, Shaffer, Hopkins, and Yale, 1981; Lyons, 1996; Roberts, 1994) However, there is also considerable evidence that current performance appraisal tools and procedures have not worked well Managers and employees do not like them, and they have not produced measurable effects on productivity ( Condrey, 1994; Finn and Fontaine, 1984; Lane, 1994; Longenecker and Nykodym, 1996; Nalbanian, 1981; Schellhardt, 1996) In spite
of these mixed reviews, passage of federal and state legislation, coupled with increased public scrutiny for cost containment and expectations for maximized organizational and employee productivity, have increased the importance of employee performance appraisal usage and
Trang 15This chapter will introduce the issues associated with a research study to be conducted ơn a public sector performance appraisal system This research was a partial replication of Thompson’s 1998 study conducted on performance appraisals Most of the previous research on performance appraisals has been conducted in laboratory settings using students, and dealt with either the psychometric measurements, cognitive, or procedural and distributive justice issues, with the outcome addressing the consistency, rather than the field relevance, of the performance appraisal measurement The purpose of this research was to examine the relationship between perceived supervisor management style and employee performance appraisal satisfaction This study also examined and assessed the possible moderating effects of the management style rating, quality of the relationship between supervisor and
subordinates, duration of supervisor/subordinate relationship, classification level (supervisor versus non-supervisor), performance rating, and/or age, on employee appraisal satisfaction
The first part of the chapter presents the background and statement of the problem, by
offering an overview of performance appraisal issues, as well as providing reasons why
additional research is needed in this area Next, the chapter discusses the hypotheses that will be researched and provides a theoretical framework for the investigation Finally, the chapter will discuss the study’s limitations and delimitations and its significance for both researchers
and practitioners
Background of the Problem
A widely researched topic in all of the personnel literature is the employee performance appraisal Bernardin and Beatty (1984) have defined performance appraisals as “the
Trang 16effectiveness and/or standards of performance met.” Over the past fifty years, academicians have devoted a great deal of time and effort to find ways to improve performance appraisals (Maroney and Buckley, 1992) Most of this research has focused on the effectiveness of the performance appraisal (Bretz, Milkovich, and Read, 1992) Theoretically, the literature on performance appraisals suggest they should: 1) provide managers with training and usefil commmumication tools for employee goal setting and performance planning; 2) mcrease employee motivation and productivity; 3) provide legally defensible, objective, fair standards and procedures; 4) provide a solid basis for wage and salary administration; 5) provide data for a host of human resource decisions; 6) reflect specific, measurable goals from the agency’s strategic plan; 7) provide individual performance standards that are consistently, objectively defined, measured, tested and fed back from supervisors to employees to continuously correct and improve the measurement accuracy and acceptance by the raters and ratees (Denisi,
Robbins, and Summers, 1997; Greenberg, 1986; Krauchuk and Schack, 1996; Longenecker
and Nykodym, 1996; Robinson, Fink, and Allen, 1996) In summary, the majority of research performed over the past few decades has focused on the psychometric properties of rating formats, rater training, procedural and distributive justice factors supporting fair managerial practices, and cognitive operations conceming performance judgments (Barrett and Kernan,
1987; Bretz, Milkovich, and Read, 1992; Feldman, 1981; Hogan, 1987; Steiner and Rain, 1989; Spool, 1978; Vegiahn, 1993; Wemer and Bolino, 1997)
However, there is controversy regarding the usefulness of this research, as practitioners still express a great deal of dissatisfaction with appraisal tools, processes and systems (Bretz
Trang 17concemed that resultant discussions around performance ratings will demotivate employees, stifle commmnication and decrease productivity Experience has shown that appraisal systems and tools have not resulted in the desired outcome of tangible performance improvement Reported results document consistent failure in industry, as well as governmental agencies Banks and Murphy (1985) succinctly sum up the current state of affairs:
Organizations continue to express disappointment in performance appraisal systems despite advances in appraisal technology Appraisal reliability and validity still remain major problems in most appraisal systems, and new (and presumably improved)
appraisal systems are often met with substantial resistance In essence, effective unc’ spPrsisal in organizations continues to be a compelling but unrealized
Yet, despite these dismal outcomes, Murphy and Cleveland (1991) report that 74-89% of organizations continue to have formal appraisal systems Therefore, improving appraisal effectiveness deserves greater attention
Public sector agencies are giving appraisals increased attention In an attempt to improve productivity, while suffering significant reductions in funding, governmental organizations have become increasingly interested in accurately assessing employee job performance and involving employees in performance standards and goals (Bernardin and Beatty, 1984) Today’s diverse and changing workforce is demanding more participation in decision-making processes and can be resistive to hierarchical forms of organization This is due to passage of federal and state legislation, recent court rulings related to fair employment practices,
Trang 18and employee’s expectations of an employee/employer contractual relationship (Lane, 1994;
Pearce and Porter, 1986; Wemer and Bolino, 1997)
In response to these concerms, researchers have begun to explore the contextual aspects of the performance appraisal process, such as examining the characteristics of effective appraisal systems, assessing employees’ reactions to various aspects of appraisal systems, and the social context variables that can impact performance appraisal systems This type of research is
promising for managers and human resource personnel charged with the development and implementation of performance appraisal tools and systems (Bernardin and Beatty, 1984;
Duarte, Goodson and Klich, 1994; Igen and Feldman, 1983; Pooyan and Eberhardt 1989;
Thompson, 1998) What the new movement in research is suggesting is that the effectiveness of the appraisal system depends not only on the technical and legal aspects of the appraisal but
also on the broader organizational and managerial context
Prior researchers have found that many factors, such as managerial style, organizational structure, rating purpose, etc constitute these contextual infinences which may affect
appraisal effectiveness (Carroll and Scheier, 1982; Landy and Farr, 1980) Social context factors are a subset of these influences Most of the studies examining these factors, sach as
Trang 19implementation of a performance appraisal system (Dobbins, Cardy and Platz-Vieno, 1990;
Gosselin, Wemer and Halle’, 1997; Roberts, 1990; Thompson, 1998)
Additional factors that could influence employee appraisal satisfaction are appraisal session characteristics, such as the supervisor’s behavior (Cederblom, 1982; Giles and Mossholder,
1990) This research has addressed supervisor behavior during the appraisal interview and referred to this as supervisory session variables Session variables such as goal setting, encouragement of employee participation and supervisory support have been consistently related to positive employee reactions One concern or limitation regarding these studies is that they have focused on supervisory behaviors only during the performance appraisal interview Greller’s (1978) findings suggest that appraisal performance style was related to management style, which exists beyond the appraisal interview As the appraisal session is typically a rather brief, annual occurrence, focusing only on this interview would ignore other
system contextual variables
Statement of the Problem
This review of the literature thus far suggests that there has been little empirical research exploring the contextual and social factors, such as supervisory management style, on employee performance appraisal satisfaction Pooyan and Eberhardt (1989) suggest this
knowledge gap needs to be addressed with additional research:
Trang 20Therefore, to further close this gap, the purpose of this study will be to conduct research in a field setting in order to examine if and how a supervisor’s perceived management style effects
employee appraisal satisfaction Specifically, the study will: (1) examine the relationship
between perceived management style and employee performance appraisal satisfaction, (2) assess the possible moderating effects of the management styie rating, quality of the relationship between supervisor and subordinates, duration of supervisor/subordiate
relationship, classification level (supervisor versus non-supervisor), performance rating, and/or age, on employee appraisal satisfaction
Theoretical Perspective
Carroll and Schneier (1982), Denhardt (1984), Harrison (1987), and Keeley (1978), in
their discussions on current organization theories saggest that organizations lie on a
continuum from closed to open systems The closed or mechanistic system focuses on routine internal operations, control mechanisms, a hierarchical structure and an overall objective of organizational efficiency Little effort is expended on anticipation of environmental influences At the other end of the continuum lies an open or organic system which encourages
participative employee teams, has more ofa flattened as opposed to hierarchical structure, and a flexible, adaptive, anticipatory style of environmental adaptation
It is important to note that performance appraisals are a subsystem of an organization, and thus inseparable from its context, the characteristics of the organization and the environment (Dobbins, Cardy and Platz-Vieno (1990; Nathan et al (1991) As previously mentioned, contextual factors can affect a performance appraisal system This study was concemed with
Trang 21specifically the relationship between a supervisor and the subordinates and the effect this may have on employee appraisal satisfaction
There has been a great deal of research on the effect management style has on
organizational effectiveness, employee motivation and job satisfaction (Argyris, 1964; Bennis,
1989; Covey, 1991; Herzberg, 1966; Likert, 1967; Masiow, 1954; Mayo, 1933; McGregor,
1957) These researchers’ findings suggest that effective management styles begin with an understanding of the basic tendencies of individuals toward growth and development and fase these tendencies with the demands of the organization’s tasks Such an effort would then provide an optinmm self-actualization for both the individual worker and the organization However, very few studies relate management style to the outcome variable of employee appraisal satisfaction Furthermore, the literature on performance appraisal discussing management style typically explores supervisor behaviors only during the evaluation session There are research findings that consistently report behaviors such as goal setting, employee patticipation, feedback opportunities and supervisor supportiveness that are positively related
to employee appraisal satisfaction (Cederblom, 1982; Roberts, 1992; Roberts and Reed,
1996) Of interest to note, however, was a research finding by Greller (1978) who reported that if supervisors behaved in a more participatory manner during an appraisal interview than
Trang 22suggest that if management style were placed on a continuum, the participative, goal setting and feedback style should be more positively related to increased employee appraisal satisfaction Therefore, one significant contribution of this research study was that it further imvestigated a supervisor’s management style from a day-to-day perspective, not just within the appraisal mterview context
Upon reviewing the literature on employee reactions to performance appraisals, one finds that research in this topic area did not begin until the late 1970's and early 1980's Researchers began to investigate the possibility that the opinion of the ratee regarding the performance appraisal process was as critical to its long-term effectiveness as was the validity and reliability
of the instrument and measures (Dipboye and de Pontbriand, 1981; Lawler, 1967; Maroney
and Buckley, 1992) While controlling for favorability of the appraisal, these researchers found that the employees’ opimions of the appraisal were associated with the opportunity to state their own side, job relevancy of evaluative factors and discussion of objectives and development plans Mount (1984; 1983) researched correlates of employee satisfaction to the appraisal system, particularly focusmg on the differences between employees and supervisors regarding appraisal system aspects that were linked to satisfaction On an expansion of
Monunt’s research, Pooyan and Eberhardt (1989) found significant differences in attitudes regarding the appraisal system between supervisory and non-supervisory employees
Trang 23categorizations of the employee’s abilities and performance His research suggested that supervisory time and resources are limited Therefore, some relationships with subordinates evolve into high quality, high loyalty and trust exchanges (in-group), while other dyadic exchanges can be of lower quality with low levels of mutual influence (out group) Dansereau (4975) found that supervisors displayed a more structured, authoritarian management styie towards employees in the out-group, while more of a mentoring, developmental style was evident towards employees considered to be in the in-group It was suggested that these differences in perceived managerial style could also affect employees’ satisfaction with their appraisal
Performance appraisal research also suggests that there can be moderating variables which influence appraisal outcomes Performance appraisal research examining gender has recetved
very mixed results (Benedict and Levine, 1988; Dobbins, Cardy, and Truxillo, 1986; Shore
and Thorton, 1986; Schmitt and Lappin, 1980; Pulakos, White, Oppler and Borman; Thompson and Thompson, 1985) In an experimental setting, Benedict and Levine’s (1988) research found evidence that females were more lenient with poor performers and tended to delay performance appraisals and feedback sessions Dobbins, Cardy and Truxillo (1986) findings suggest students tended to inflate ratings of males professors relative to their true performance levels, while females professors were underrated However, Shore and Thomton (1986) did not find gender differences when participants rated familiar tasks in work
Trang 24ll
in performance ratings compared to the ratees’ performance level (Schmitt and Lappm, 1980;
Pulakos, White, Oppler, and Borman, 1989)
In a study conducted by Schmitt and Lappin (1980), investigations into the effects of rater
and ratee race and gender on rater accuracy found raters rated same-race ratees’ performance
more accurately This finding contradicts Landy and Farr’s (1980) fieid stadies which found
that raters rated same race ratees more favorably than those of another race Pulakos, White,
Oppler, and Borman’s 1989 study found that ratee race accounted for no more than 1% of the variance in overall performance ratings and ratee gender produced no significant bias in
performance ratings However, in a meta analysis of race effects, rater/ratee similarity resulted in higher ratings (Kraiger and Ford, 1985) Baldwin, Magjuka and Loher’s (1991) findings showed employee experience can have moderating effects For this study, it was decided not to test race and gender because research findings im this area have had conflictng results (igen, Bames-Farrell, and McKellin, 1993), and were not statistically significant in
Thompson’s (1998) recent study
Age and appraisal satisfaction was studied with research of nursing supervisors reporting younger subordinates rating higher than older subordinates (Ferris, Yates, Gilmore, and Rowland, 1985) Age was also a positively related significant variable reported in both the Cleveland and Landy (1981) and Griffeth and Bedeian (1989) studies, as well as Thompson’s (1998) research
Quality and duration of the supervisor/subordinate relationship are two other variables
shown to influence the performance appraisal process Relationship quality has been
Trang 25posits that a leader will develop relationships with different employees based on factors such
as dependability, competence, and interpersonal compatibility (Graen and Cashman, 1975; Graen and Scandura, 1987) However, only limited research has linked it to performance
appraisals Duarte et al (1984) m research exploring leader-member exchange and its effect on performance ratings found that employees in high quality leader-member exchanges rated high, regardless of the objectively measured performance Employees in high-quality leader- member exchanges enjoyed high levels of trust and respect, good comnnmications and a high
degree of discretion with leaders Dobbins et al (1990) lends support to these findings by concluding that appraisal satisfaction was positively correlated with closeness of supervision and quality of the leader-member exchange
The duration of the supervisor/subordinate relationship has played a role in performance ratings It has been found that in short-term relationships, supervisor overall feelings about the employee may influence his/her perception about the ratee’s performance (Duarte, et al, 1994) Fedor’s and Rowland’s (1989) research has also shown that a supervisor’s view of employee responsibility or control will vary based on the length of time a subordinate works for a supervisor Supervisors will tend to consider extemal factors in evaluating subordinate
control the longer and closer the working relationship (Duarte, et al 1994; Fedor and
Rowland, 1989)
Previous performance ratings and their fluence on the ratee’s appraisal satisfaction have
been researched and resulted in conflicting outcomes Fedor and Rowland (1989) did not find
Trang 2613
due to previous appraisal ratings Support for this finding has also been reported by Dorfman
et al (1986) and Russell and Goode (1988) For this research, performance appraisal rating will be investigated, as it was in Thorupson’s (1998) dissertation research
One final descriptive variable that will be added to this study’s questionnaire will be the
organizational geographic district Of the seven districts that make up this public health organization, one had begun to re-design their appraisal system and hoped to have it completed within the year Behavioral competencies and performance standards are being developed and defined The managerial goal is to have a more accurate, accepted system in
place within the year Furthermore, seven different directors lead seven districts, located
throughout the state Likert (1967) suggests that a manager’s pattern of leadership tends to be replicated in the leadership behavior ofhis sabordinates Dobbins, Cardy and Platz-Vieno (1990), suggest that appraisal systems should be designed to fit the unique characteristics of each organizational unit or workgroup in order to maximize appraisal satisfaction Finally, the public health directors desired mcliusion of this variable as they begm to redesign their
performance measurement systems The mean management style ratings, broken out by district, as well as appraisal satisfaction ratings, was presented in response to their request
Questions and Hypotheses
Based on the review of research concerning management style, performance appraisal satisfaction and social context im performance appraisal literature, the following questions and hypotheses were investigated:
Trang 27Question 2: Are there variables, sach as management style, quality of sapervisor-
subordinate relationship, duration of supervisor-subordinate relationship,
level (supervisor versus non-supervisor), performance appraisal rating, and/or age, that predict employee appraisal satisfaction?
Hypothesis Ho1: There is no statistically significant difference among four perceived management styles and employee performance appraisal satisfaction Hypothesis Hal: There is a statistically significant difference among four perceived
management styles and employee performance appraisal satisfaction Hypothesis Ho2: There is no statistically significant correlation among employee
performance appraisal satisfaction and the following predictor variables: Ho2(a) management style,
Ho2(b) quality of supervisor-subordinate relationship
Ho2(c) duration of supervisor-subordinate relationship, Ho2(d) classification level (supervisor versus non-supervisor),
Ho2(e) performance appraisal rating,
Ho2(f) employee’s age,
Hypothesis Ha2: The employee’s performance sppraisal satisfaction is statistically significantly correlated with the following predictors:
Ha2(a) management style,
Ha2(b) quality of supervisor-subordinate relationship, Ha2(c) duration of supervisor-subordinate relationship,
Trang 2815
Ha2(e) performance appraisal rating Ha2(f) employee’s age
Definitions
Performance appraisal: a performance appraisal is the process by which an organization establishes, measures, and evaluates an empioyee’s behavior and accomplishments for a finite
period of time (Eckes, 1994)
Social context: Social context refers to those factors that involve the teraction between supervisor and subordinates It encompasses a vast number of issues and circumstances, including, but not limited to relationship between supervisor and subordinate, observation of performance by supervisor, interdependence among employees, interpersonal similarity
between a rater and a ratee, and personal power of the rater ( Duarte, et al., 1994; Mitchell, 1983.)
Management style: Management style refers to those attributes and behaviors used by a
supervisor in his interactions with subordinates (Likert, 1967)
Performance appraisal satisfaction: Performance appraisal satisfaction is the reaction of employees to various aspects of the appraisal process (Mount, 1984)
Trang 29Limitations and Delimitations
There were limitations to this replicated study First, all data was collected from a single source, a self-reported questionnaire measuring respondents’ perceptions regarding supervisor style and appraisal satisfaction The study relied on the willingness of the respondents to honestly complete the survey and return it Also, because the survey relies on self-report, respondents’ perceptions may differ from reality The reliance of single source data may result in common-soutce variance Secondly, it is assumed that the timing of the survey may bias some of the responses received and has the potential to skew answers Respondents receive an appraisal on the anniversary date of their hire, so some may have recently received an
appraisal, while others may have been evaluated at a longer interval from the time of the survey and have to rely on memory
There were delimitations of the study This investigation focused on the appraisal system in one state public health agency, so generalizations will be limited Additionally, although all seven public health districts were sampled, only the individuals in the Region 3 district have begun to redesign their appraisal system in a similar fashion to Thompson’s (1998) study Her study sampled only one district with a new appraisal system, from multiple districts across the state Therefore, this study’s sampling methodology will present a deviation from the original
study The other regional offices have not redesigned their appraisal systems
Finally, because this is survey research, and not experimental in design, causality cannot be shown Experimental research, in both public and private organizations, needs to be
Trang 3017 Significance of the Study
This study makes both substantive and theoretical contributions to current research in the
atea of performance appraisals Due to the paucity of research on examining the relationship of perceived management style and employee appraisal satisfaction, this dissertation’s findings will add to the existing body of knowledge im this topic area There have been studies that looked at supervisor’s behaviors in the appraisal session but they did not examine management
style throughout an ongoing relationship Social contextual factors that were examined have been linked to performance ratings or job satisfaction, not appraisal satisfaction This research study investigated these variables, thereby further relating management and leadership theory to the performance appraisal area
This field study will also add to work done in a public sector state agency setting What little research has been done m governmental settings has focused at the federal or mmmicipal level of organizations Also, the Governor’s office may be interested in the results of this study Recent passage of a piece of legislation made several significant changes to the state personnel system The Personnel Commission status was changed to that of a division reporting directly to the Governor Of particular interest to this researcher was the recently created 21 item personnel division action list One of the key action items to be addressed is performance measurement and the creation of training and evaluation programs for managers wtiting employee performance evalnations
Trang 31been devoted to performance appraisal systems This study will provide a system blueprint and
recommendations to allow practitioners in the field to target their efforts more successfully Summary
There is a tremendous amount of material on appraisals, from both researchers and practitioners alike, yet results continue to be disappointing and conflicting The early research
focused on the psychometric issues to improve evaluation tools Later, researchers began to focus on contextual characteristics such as validity and reliability of the instrument and subsequent rater training, primarily occurring in a lab setting using student participants
This present study went beyond these earlier efforts with the goal to further increase our knowledge in the area of social contextual variables by examining the influence an employee’s perception of supervisor’s management style has on employee appraisal satisfaction The
study also attempted to ascertain what variables moderated or predicted employee appraisal satisfaction Chapter two provides an in depth review of the performance appraisal literature, as well as the variables investigated Chapter three will outline the research methods used to
investigate the relationships of the variables discussed in Chapter two Chapter four will report the findings of the analysis procedures used to address the research questions and hypotheses
Trang 3219
CHAPTER 2: REVIEW OF THE LITERATURE
Introduction
The literature reviewed in this chapter is arranged in topical format and will provide the theoretical and empirical base for examining the hypotheses discussed in Chapter One The first part of this chapter will discuss the background on performance appraisals conducted in the public sector and early performance appraisal research The following three sections will examine the literature that 1) reports on the issue of employee performance appraisal
satisfaction and its importance to the overall effectiveness of a performance appraisal, 2) discusses leadership or management style and its influence on various aspects of the performance appraisal, and 3) identifies possible moderating effects of certain variables on appraisal satisfaction The final section of this chapter summarizes what has been discovered
and how this present study intends to address some of the issues needing additional research Performance Appraisal Research
Performance appraisals involve a complex process of supervisory judgments used to
measure and evaluate the work performance of subordinates Although at first glance this may appear to be a fairly straightforward practice, appraisal of another’s work involves many
players and thought processes
Performance appraisals are not new, as the following quote by Whisler and Harper (1962)
Suggest:
The appraisal of individual performance is a fundamental human act Long before the emergence of great bureaucracies which dominate so much of our lives today, each man watched over men, appraising their behavior in terms ofhis goals and needs and
Trang 33Relationships were initiated, strengthened, or severed on the basis of personal appraisals of others
Although not a new procedure, what is recent is the modem organization with its complex, formal structure, thereby necessitating a more formal method of appraisal, for both public and private organizations However, one organizational theorist, W.E Deming (1986), believed employee evaluations are detrimental to the goals of an organization and should be eliminated He suggested that organizational processes were a better focal point than the individual
In spite of Deming’s suggestion, most organizations have personnel policies which include some type of performance appraisal in order to justify promotional, salary, and termination decisions, to determine training and development needs, and correct employee performance
and set goals (Becker, 1995; Eckes, 1994; Fitz-enz, 1993; Pearce and Porter, 1986) In fact
Fitz-enz (1993) suggests that performance evaluation is essential because “ without performance measures, we generate ambiguity and anxiety and neither are conducive to improvement.” Furthermore, if performance appraisal was eliminated, the other human resource actions could occur almost at random or based on supervisory intuition (Ewen,
1994)
Bemardin and Beaty (1984) and Roberts (1990) cite four major reasons why there has been continued, in fact a renewed, interest in the subject of performance appraisals First,
there was the legislation passed around affirmative action and equal employment opportunity With passage of these laws, organizations were very concemed that they not engage in discriminatory practices based on race, gender, age, religion, national origin or disability
Trang 3421 designated groups within their work force Therefore, personnel practices needed to be valid and job related One tool that offered some measure of assurance was a formalized
performance appraisal system Secondly, as the American worker gained more autonomy with employee rights, such as due process, they also wanted more voice on decision-making and
procedures, such as merit pay and promotional and transfer decisions Third is the issue of the increased costs of mismanaging human resources, due to poor hiring matches to
organizational competencies, wrongful terminations, etc Dramatic savings could result if selection, and other measurement procedures were improved Finally, is the issue of productivity One strategy recommended by Landy, Farr and Jacobs (1982) suggests that improved personnel practices, especially useful performance appraisal systems, can increase productivity of American workers These concems have furthered continued attempts to develop effective appraisal tools and systems
Public Sector Performance Management
Performance appraisal usage increased in the public sector in the late 1970s, especially with the passage of the Civil Service Reform Act of 1978 (Moore, 1985) The phrase
“performance measurement” first entered the Civil Service lexicon following the introduction of the Civil Service Reform Act It was introduced to the federal work force with the aim of imcreasing productivity by improving performance appraisal systems across every level of government The mandate was each agency was delegated with more authority to develop a decentralized but viable performance appraisal system Each agency was to develop standards and employees were encouraged to participate in the development of these standards
Trang 35performance appraisal process and critical to successful implementation The theory behind the legislation was a belief in economic incentives as motivators for public employee
performance, linking pay to performance Focus was placed on improvements to performance appraisals by implementing merit and performance-based bonus pay systems (Lane, 1994) State and local jurisdictions soon adopted similar approaches Surveys of state and locai governments indicate that performance-based systems are becoming more common (Moore,
1985) The courts are also requiring more performance-based systems
However, in practice, significant procedural and legal requirements have been a driving concern of public sector personnelists (Ewen, 1994) There are components of public sector jobs that are difficult to quantify and measure, yet critical to successful performance, such as
initiative, teamwork, or courtesy and tact with customers Economic and political conditions may change that can undermine the feasibility of previous objectives and standards This concem has served to limit experimentation and options in government agencies’ performance management processes The results have been disappointing due to government hiring and pay freezes, rating inflation, and organizational downsizing Promotions can result due to seniority or exam scores, rather than demonstration of meritorious performance Compensation
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can be the result of hard bargaining and compromise, and typically stated in vague language Employees can be uncertain about the standards that will be used to measure their
performance in carrying out the program directives
Furthermore, in addition to the above mentioned issues, the very nature of public sector employment, with its emphasis on service, adds to the difficulty of accurate definition of performance standards and goals and establishment of clear links to merit pay principles Additionally, for government employees, job responsibilities can fall along a continuum of activities, making it difficult to identify which person was responsible for what specific task and outcome Profitability and return on investment, standard measurements in the corporate
world, are difficult to measure in the public sector With the ‘Teinvention” reform movement,
public sector managers are asked to do increasingly more with less full-time equivalent
positions Coupled with the arrival of total quality management and its emphasis on teams and flatter organizational hierarchies, managers report difficulty in isolating individual performance and individual contributions (Ewen, 1994)
Nalbanian (1981) also notes that even with clear standards, trust plays an important part in any appraisal system He suggests the quality of the appraisal process, from the ratee and rater
perspective, depends on the day - to- day supervisor-subordinate relationship Moore (1985) goes on to say that public managers also need to realize that the supervisor’s motivation and ability to perform accurate appraisals is as important as the design of the appraisal
Supervisors should be provided training on how the performance objectives and standards link directly to the strategic plan’s goals, how to avoid common errors in evaluation such as the
Trang 37interviewer’s evaluation is based on limited information, e.g based on a smile or handshake, an applicant is judged as a leading candidate before the interview begins Central tendency refers to the interviewer’s inclination to appraise the candidate at a central point on a scale, usually the average or midpoimt Leniency is a rater’s tendency to assign ratings that are
higher than those warranted by a ratee’s performance (Mcintyre, Smith, Hassett, 1984) Establishment of performance appraisal systems that reduce managerial subjectivity remains a critical challenge
Purpose and Function of Performance Appraisals
Carroll and Schneier(1982) and Kravchuk and Schack (1996) stress that a performance
appraisal system within the human resource management system is nested within the greater organizational system These authors use an open systems approach which advocates viewing the performance appraisal system within the organizational context in which it operates
With respect to the functions of appraisals, Becker (1995) suggests that they should be
designed to 1) help people productively discuss and address performance mistakes so goals are achieved, and 2) recognize excellent performance (Dobbins, Cardy, and Platz-Vieno,
1990; Harvey, 1997; Lane, 1994; Lovrich, Shaffer, Hopkins and Yale, 1981; Lyons, and
Callahan, 1996; Roberts, 1990), stress that the fimction of evaluations should be to encourage managers to coach employees with a fiture orientation to developmental performance
pmprovement They suggest that the appraisal tool for public sector organizations needs to be developmental, rather than directive or administrative There are several researchers who also see a need for appraisals to provide documentation of fair procedures and outcomes (Barrett
Trang 38Employees desire feedback about their progress (Igen, Fisher and Taylor, 1979) If
feedback was positive, their psychological needs of competence and success were met If negative feedback is the result, they can experience a sense of failure, so the manner in which managers provided feedback was also very important (Herold, 1985; Nalbanian, 1981;
Schoenfeld, 1994; Schellhardt, 1996)
Dissatisfaction and Ineffectiveness of Appraisal Systems
Despite the fact that performance appraisals are used in most private and public sector
organizations, dissatisfaction seems to be the norm A 1995 national survey indicated that
forty-four percent of 218 companies with evaluation systems had changed theirs in the previous two years and another 29 percent expected to do so ( Schellhardt, 1996) A survey by the Society for Human Resource Management, of Alexandria, Virginia concluded that
more than 90 percent of appraisal systems were unsuccessful (Finn and Fontaime, 1984) Antonioni’s (1994) survey of 297 managers from Midwest companies indicated that the sixty- eight percent rated appraisals as ineffective, and had either stopped using them or planned to stop using them with the next two years Latham and Wexley (1994) report that appraisers perceive the instruments to be cumbersome and difficult to use due to subjective, vague standards, and inconsistency among raters They also report that most employees do not look forward to the process because of the judgmental aspect of the evaluation Supervisors do not like it because it can demotivate employees and decrease productivity and morale
Longenecker and Nykodym’s (1996) study on public sector performance appraisal systems reports discouraging findings as well Their survey report states that although agency
Trang 39and that appraisal systems are not always as effective as agency management believes Bemardin and Beatty (1984) also suggest that lack of employee mput, inadequate
management training, unclear performance standards and rater bias can also contribute to appraisal ineffectiveness Deming’s (1986) suggestion is to eliminate this problematic tool, because of the possible demotivating aspects However, many researchers argue that to eliminate appraisals would encourage an entitlement culture that could replace performance standards Deming fails to recognize that focusing on behavioral competency for appraisal can provide valuable feedback and job assessment (Ewen, 1994)
Although most of the past research has focused on psychometric properties and cognitive operations of performance appraisals, many researchers are now beginning to question whether this area of research, usually conducted in lab settings, yields the most useful information for practitioners (Banks and Murphy, 1985; Bretz, Milkovich and Read, 1992;
Cardy and Dobbins, 1994; Dobbins, Cardy and Platz-Vieno, 1990; Dipboye, 1985; Gosselin, Wenner, and Halle’, 1997; Lane, 1994; Murphy and Cleveland, 1991; Nalbanian, 1981; Napier and Latham, 1986; Roberts, 1995) The concem of these researchers is that if current research
continues along past lines, the gap between research and practice will only increase Murphy and Cleveland (1991) noted that although nmch of the research has focused on appraisal formats and minimizing rater’s bias, perhaps an area that warrants further attention is the
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operational effectiveness Furthermore, in discussing the trade-offs between studying performance appraisals in laboratory and field settings, they also suggest that although laboratory studies allow for strict control of the experimental setting, most laboratory studies have a definite artificial character Their conclusion was that a field approach to appraisal research is most appropriate These researchers and others are now turing their attention to other aspects of the performance appraisal process, such as contextual and social variables and their subsequent impact on satisfaction These areas have received limited study (Bemardin
and Beatty, 1984; Duarte, Goodson, and Klich, 1994; gen and Feldman, 1983; Judge and Ferris, 1993; Landy and Farr, 1980; Thompson, 1998) These researchers stress that appraisal
systems are integrated into a larger organizational system and do not exist in a vacuum Their work suggests that organizational variables, such as organizational size, span of control, and
climate can affect the appraisal process
Landy and Farr (1980) present a definition for contextual variables as “those that are not explicitly related to the nature of the rater, ratee, or rating instrument, but rather may be considered part of the context in which the rating occurs.” For example, rating purpose, job position or characteristics, interpersonal similarity between rater and ratee, rating expectation and norms (such as rating inflation), work interdependence, and the opportunity for the supervisor to observe behavior can all have an effect on performance ratings The work of these researchers has suggested to those interested in the field of performance appraisal that performance ratings are not just the sum of their parts, but are also influenced by social and contextual factors Additional work needs to be done as the research in this arena is very