The role of satisfaction with the performance appraisal; a comparative study between the public and private sectors.
| Autor | Rodrigues, Rosa Isabel |
1 Introduction
The management and appraisal of performance (PA) is a controversial subject in both the public and private sectors, and in most Portuguese organizations it more a ritual than a practice, which is why it does not achieve the results for which it was projected. Cunha et al. (2018) mentioned that much importance is given to the form and little importance to the content, which means the PA generally presents three weaknesses: (a) insufficient planning; (b) process and integrity problems; and (c) a non-meritocratic logic.
The quality and quantity of the work developed constitutes the competitive differential of any organization, and so it is highly important to understand how certain practices and processes influence organizational results (Nguyen et al., 2020). The PA has come to occupy a prominent place in organizations because only it can be used to measure the competences of their workers and the way they contribute to achieving organizational success, both qualitatively and quantitatively (Okolie et al., 2020). Consequently, workers' satisfaction with the PA is vital to reap the rewards of the most talented resources (Memon et al., 2019). Yet, it should be stressed that the performance of those who carry out similar functions should be evaluated using the same criteria, so that it can be compared in a fair, objective, transparent, and consistent way (Vuong et al., 2020). When the performance appraisal (PA) process is perceived by the workers' as inadequate and unfair, it tends to increase their demotivation, dissatisfaction with the work, and turnover intentions, leading to reduced productivity (Memon et al., 2020). On the other hand, when the PAP enables the workers to acquire more knowledge of the dimensions and procedures of their evaluation and gives them the opportunity to direct their efforts and actions toward the strategic objectives of the organization, they tend to feel more satisfied with the results of their performance (Bayo-Moriones et al., 2020). Organizations that build PAPs considered to be satisfactory by their workers "reap" and foster attitudes and behaviours that contribute significantly to organizational success (Memon et al., 2020).
In this sense, Widiani and Dudija (2020) mentioned that satisfaction with the PAP is considered one of the most important reactions to the PA per se, especially when it is seen as useful and accurate. The PAP is considered useful when it enables a diagnosis of workers' performance in a previously defined time period, because beyond having a strict relationship with all of the human resources management (HRM) practices, it contributes to improving the potential of each worker and, with that, it generates better personal and organizational results (Ahmed and Sattar, 2018). When the PAP offers accurately measured indicators, it enables grounded decision making and prevents the results from being influenced by the personal interests of the appraiser/hierarchical superior (He et al., 2020).
In Portugal, the investigation focuses essentially on the PA in the public sector (e.g., Correia et al., 2019; Lira, 2014; Lira et al., 2016; Madureira et al., 2021), with few studies examining the private sector (Cunha et al., 2018). In addition, the investigation into the differences between sectors has focused primarily on studying workers' motivation. The studies have shown that (a) workers in the public sector have greater intrinsic motivation and are less extrinsically motivated than their peers in the private sector, and (b) workers in the public sector are relatively more risk averse. The results also reveal that pecuniary incentives and variable remuneration based on merit can be counterproductive (Barbieri et al., 2023; Pagan and Malo, 2021).
In light of the above, this study is based on two essential questions:
Question 1: What differences in perception regarding satisfaction with the PA can be observed between public sector and private sector organizations?
Question 2: How does satisfaction with the PAP influence perceptions regarding the usefulness and accuracy of it by workers from different sectors?
In light of these questions, this study aims, on one hand, to clarify the differences that can emerge relating to satisfaction with the PA between the Portuguese public sector and private sector; on the other hand, it intends to broaden the scientific knowledge in this area by also analysing the mediating role of satisfaction with the PAP in the relationship between the perception of usefulness and accuracy of it and workers' satisfaction with the result of their last PA. Despite its relevance, there are no national or international studies that analyse the aforementioned constructs in an integrated way. In sum, the present study aimed to analyse (a) if satisfaction with the PA differs depending on the sector where the workers carry out their functions (private versus public), and (b) if the relationship between the workers' perception regarding the usefulness and accuracy of the PAP and satisfaction with the result of their last PA is mediated by satisfaction with the PAP.
1.1 Conceptualizing the functions of the performance appraisal
The PA is a tool that enables an improvement in individual performance and the identification of workers' contributions to organizational results (Ahmed and Sattar, 2018). According to Memon et al. (2019), besides facilitating the definition of objectives and the identification of training needs, the PA has an important evaluative component that enables a comparison with other members of the organization and/or with previous individual performance. Setiawati and Ariani (2020) added that the results obtained in the PA significantly influenced workers' behaviour and consequently their performance levels.
There is consensus that, independently of the sector, the PA seeks the following: (a) to align workers' performance with the strategy of the organization; (b) to provide information about the aspects most valued by the organization; (c) the acquisition of new knowledge and competences; (d) to increase workers' motivation; (e) to provide a basis for the decisions taken in the various HRM practices (e.g., rewards management, career development, validation of the recruitment and selection process); and (f) management of the challenges resulting from the constant transformations of the work context (Stewart and Brown, 2020).
Rahman et al. (2020) added that the PA is a dynamic process that is developed over five stages: (a) definition of competences (e.g., techniques, behaviours) and of the objectives to achieve in the previously defined time period; (b) putting into practice the plan established in the previous phase; (c) the performance appraisal per se, through filling in an evaluation form and its approval by the direct boss/hierarchical superior; (d) discussion of the results obtained with the collaborator, giving them feedback about their progress and the points they need to improve; and (e) planning of the objectives for the next PA cycle in accordance with the organization's strategy. The PAP can involve various players, namely: the appraisee, the direct boss, peers, subordinates, and other stakeholders (Nguyen et al., 2020).
1.2 Satisfaction with the performance appraisal
Satisfaction with the PA is a crucial variable in the organizational context, as it is directly related with workers' performance (Naeem et al., 2017). Dissatisfaction with the PA creates negative attitudes and perceptions that translate into counterproductive results for the organization (e.g., low productivity, increased turnover intention), which is why the PA is essential for making the most of individual potential. Satisfaction with the PA lies in a reciprocity relationship and when the collaborator perceives that their appraisal is fair, impartial, and mutually beneficial they have a tendency to reciprocate in the same way, leading to increased performance and organizational commitment (Memon et al., 2019).
Memon et al. (2020) argued that the higher workers' satisfaction is with the results of their PA, the more motivated they feel and less willing they are to abandon the organization.
1.3 Satisfaction with the performance appraisal in Portugal: differences between sectors
According to Madureira et al. (2021), the PA in the private sector implies the evaluation of workers by their managers with the aim of improving individual performance. This evaluation can result in positive consequences (e.g., productivity rewards, rapid career progress) or negative ones (e.g., penalties, slow career progress) for the evaluated party. These results influence workers' involvement with the PAP in accordance with how fair/unfair and/or positive/negative they perceive it to be.
In the public sector, the PA also implies the evaluation of the worker by their manager(s) with the aim of improving individual performance. However, it was only after the implementation of New Public Management (NPM), at the start of the 21st century, that the public sector began to focus on individual performance through PAPs that enabled the comparison and differentiation ofworkers' performance and their contribution to organizational objectives (Madureira et al., 2021). Despite each sector having its own characteristics, the methods and techniques used in the private sector have begun to be introduced in the public sector, namely with regard to promotions and bonuses (Al-Jedaia and Mehrez, 2020; Madureira et al., 2021), which could arouse different reactions from the workers from the different sectors. Naeem et al. (2017) highlighted that private sector workers feel more satisfied with the results of their PAs than those from the public sector, because they believe them to be fair and that they translate their performance.
In Portugal, and in a NPM logic, workers from the public sector are assessed through the Integrated System for Performance Appraisal in the Public...
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