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Ejss 10 3 15
Ejss 10 3 15
Arshad Zaheer
Foundation University, Islamabad, Pakistan
E-mail: arshad_zz@yahoo.com
Tel: +92-3335135751
Abstract
This paper aims at studying outcomes of performance appraisal and exploring factors that
can make harm to the PA effectiveness in the perspective of Pakistani public and private
sector organizations. Data were collected through survey of 127 managers and employees.
Overall results reveal that in Pakistani public and private sector organizations, awareness
level about outcomes of effective performance appraisal is more than factors that can make
harm to the effectiveness of performance appraisal. Managers have different views from
employees regarding detriments to PA effectiveness whereas, regarding outcomes of PA
effectiveness, male and female managers/operatives have different views.
1. Introduction
Effectiveness of performance appraisal has so far been studied in different contexts. However,
exploring important areas like outcomes of effectiveness of performance appraisal and identification of
factors that can make harm to the effectiveness of performance appraisal in perspective of Pakistani
organizations was needed. Therefore, the researchers set objectives of this paper to study the outcomes
of effectiveness of performance appraisal and to find key detriments to effectiveness of performance
appraisal in Pakistani organizations. This paper aims at answering the following research questions:
i. What are outcomes of effective performance appraisal in Pakistani organizations?
ii. What are the factors that can harm effectiveness of performance appraisal in Pakistani
organizations?
2. Literature Review
Published literature concerning outcomes and detriments of effectiveness of performance appraisal are
discussed separately as under:
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H2: There is a significant difference of opinion between managers and employees working
with public/private sector organizations regarding (a) outcomes of effective performance
appraisal and (b) detriments to effectiveness of performance appraisal.
H3: There is a significant difference of opinion between male and female managers/employees
working with public/private sector organizations regarding (a) outcomes of effective
performance appraisal and (b) detriments to effectiveness of performance appraisal.
Selected Dimensions % n
Age
20 to 29 years 77.08 88
30 to 39 years 15.04 17
40 to 52 years 07.08 08
Gender
Male 78.2 97
Female 21.8 27
Education
Masters or above 31.6 36
Graduation 68.4 78
Experience
Less than 1 year 34.0 34
1 to 3 years 38.0 38
4 to 7 years 17.0 17
8 years or above 11.0 11
Job Position
Managerial/Officer 66.7 76
Employee/Operative 33.3 38
Type of Organization
Pubic Sector Organization 50.0 57
Business/Private Sector Organization 45.6 52
Own Business 4.4 5
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Table2: Summary of Factor Analysis and Tests of Assumptions for Factor Analysis – Kaiser-Meyer-Olkin
(KMO) and Bartlett’s Coefficients
Items Bartlettd
Items Iterations
Total Eliminate
Variables Remainin Total (Ca, KMOc
Items d Total χ2 df Sig.
g RMb)
(Ca, RMb)
Outcomes of
14 8 6 4 0.715 164.096 15 0.000*
Effective PA
Detriments to
19 11 8 5 0.759 225.833 28 0.000*
Effectiveness of PA
Total 33 19 14 9
Note: a C = Communalities
b RM = Rotation Matrix
c KMO = Kaiser-Meyer-Olkin Measure of Sampling Adequacy
d Bartlett’s Test of Sphericity
* p < 0.01
The factors having higher loads existed in the variables of outcomes and detriments of
effectiveness of performance appraisal. Table 3 shows that these variables have 14 items with higher
loads based on communalities and rotated component matrices. The estimates of the variance in each
item accounted for by the components in the factor solution were above 0.50. According to rotation
sums of squared loadings, component/s collectively explained more than 60% of the variance.
Regarding variable of outcomes of effectiveness of performance appraisal, items eliminated
were “Employees’ learning about themselves”, “Establishment of relationship between performance
and reward”, “Use of evaluations as feedback to improve performance”, “Existence of feelings of
equity among employees”, “Development of managerial strategies for training”, “Reduced employee
stress”, “Review of overall progress” and “Development of specific action plans for future”.
For variable of detriments to effectiveness of performance appraisal, items eliminated were
“Exemptions to the highly visible employees”, “Conduct of performance appraisal to punish the low
performers”, “Use of fundamentally flawed appraisals”, “Focus on encouragement of individual
instead of teamwork”, “Focus on extremes (exceptionally good or poor performance)”, “Support to
autocrat (dictator type) supervisors”, “Use of vague qualities and irrelevant measurement criteria”,
“Use of useless checklists for evaluation”, “Monologues instead of dialogues in feedback sessions”,
“Supervisor’s misguidance to rater” and “Inaccuracies at supervisor/organization’s end”.
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Table 3: Factor Loadings – Outcomes and Detriments of Effectiveness of Performance Appraisal
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Table 4: Means and Standard Deviations
Variables M SD
Outcomes of Effective PA 4.04 0.553
Employees’ knowledge about how they are doing 4.26 0.799
Improvement in the accuracy of employee performance 4.06 0.868
Linkage between current performance and employee's goals 4.00 0.909
Employees’ learning about “what management values” 4.00 0.882
Reduced employee turnover 3.60 1.037
Increased motivation 4.27 0.784
Detriments to Effectiveness of PA 3.60 0.649
Organizational politics that disturb performance of targeted employees 3.70 1.150
Doubts in the mind of performers about appraisal's after effects 3.69 0.983
Rewards on nonperformance 3.29 1.238
Creation of emotional anguish in employees 3.49 1.029
Reluctance of raters to offer feedback 3.45 0.966
Appraisal's focus on achievement of short term goals 3.74 1.044
Subjectivity of appraisal results 3.65 0.929
Inconsistencies in setting and applying appraisal criteria 3.60 1.063
Table 5 displays the results of two independent samples t statistic, applied to test the hypotheses
1, 2 and 3. The average perceptions of managers/employees of public and private sector organizations
of Pakistan were same in respect of variables of outcomes and detriments of effectiveness of
performance appraisal. Results related to hypothesis 2, revealed that average perceptions of
managers/officers and employees/operatives of public/private sector organizations of Pakistan were
same in respect of outcomes but different in case of detriments of effectiveness of performance
appraisal. Results of third hypothesis revealed that average perceptions of male and female
managers/employees of public/private sector organizations of Pakistan were different in respect of
outcomes but same regarding detriments of effectives of performance appraisal.
Table 5: Independent Samples t-test With Respect To Sector, Position and Regarding Outcomes and
Detriments of Effectiveness of Performance Appraisal
These results overall support literature for outcomes of effectiveness of performance appraisal
while corresponding with the previous studies (e.g. Beer, 1981; Stephan & Dorfman, 1989; Dobbins,
Cardy & Platz-Vieno, 1990; Nurse, 2005; Teratanavat, Raitano & Kleiner, 2006) and also support
literature (see Deluca, 1993; Segal, 2000; Nurse, 2005; Horvath & Andrews, 2007) while studying
factors that can make harm to the effectiveness of performance appraisal.
5. Conclusion
Conclusions substantiated the research objectives while answering the research questions that Pakistani
public and private sector organizations do believe in the role of outcomes and detriments for
effectiveness of performance appraisal. The respondents are more aware about outcomes of effective
performance appraisal than factors that can make harm to the effectiveness of performance appraisal.
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As regards detriments to PA effectiveness, Managers have different view from employees. Likewise,
regarding outcomes of PA effectiveness, male and female managers/operatives have different views.
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