Compare and contrast the main claims of Goal Setting and Expectancy Theories with regard to Employee Performance Appraisal. What are the implications for the design of employee appraisal systems?

Résumé du document

The history of performance appraisal in the literature is quite recent. Its roots in the early 20th century can be traced to Taylor's pioneering time and motion studies, which interestingly also sets the beginning of the goal-setting theory. But this may not be very helpful, for the same can be said about almost everything in the field of modern Human Resources Management. Yet in a broader sense, the practice of appraisal is a very ancient art. In the scale of history, it might well deserve claim to being the world's second oldest profession. As Albert Camus wrote, "we should not wait for the last judgment - it takes place every day". Making judgments about those one is working with, as well as about oneself, is a basic human tendency. As a result, it seems appraisal is both inevitable and universal. Indeed, in the absence of a carefully structured system of appraisal, people will tend to judge the work performance of others, including subordinates, naturally, informally and arbitrarily. Thus, to avoid such injustice, a formal system of performance appraisal is needed to ensure, or at least to aim at ensuring, lawful, fair, defensible and accurate judgments.

Extraits

[...] These criteria are crucial to help employees reach assigned goals and should be used during the appraisal process. Before developing further on appraisal process, one has to admit that goal setting is not the only theory influencing on performance appraisal: expectancy theory namely offers an alternative approach studied in the next section. Expectancy Theory From the 1920s until the 1960s, a significant shift took place from physical conditions of work, as defined by Taylor and Gilbreth, to social conditions. This results of course from the influence of the Hawthorne studies, which marked the beginning of the Human Relations School. [...]

[...] A., (1978), Ubiquity of the Technique of Goal Setting in Theories of and Approaches to Employee Motivation”, Academy of Management Review, July issue. Locke, E. A., Bryan, J. F. (1969) Directing Function of Goals in Task Performance”, Organizational Behavior & Human Performance, Feb69, Vol Issue pp35-42 Locke, E. A., Latham, G., P., (2002), “Building a Practically useful Theory of Gaols-Setting and Task Motivation a 35-year Odyssey”, American Psychologist, Vol No Longenecker, C., Ludwig, D., (1990) “Ethical Dilemmas in Performance Appraisal Revisited” Journal of Business Ethics; Vol Issue 12, pp961-969 Marsden, D., (2003), “Renegotiating Performance: the Role of Performance Pay in Renegotiating the Effort Bargain”, published by Centre for Economic Performance, London School of Economics and Political Science. [...]

[...] When people lack intrinsic rewards in their work, their performance stays just adequate to achieve the reward offered, as they focus on short-term issues. In the worst case, employees may cover up mistakes, such as hiding an on-the-job accident in order to win a safety award. Going further, Colvin (1998) emphasise that money is especially weak in driving the most innovative employees, especially over the long-term. Another feature of rewards in a goal-setting approach is that goals tend to be set for individuals, rather than for teams. [...]

[...] On the other hand, expectancy theory stresses the interest of the employee in performing a task. This implies similar organisational policies as in the case of goal-setting theory. In addition, Samson (2002) suggests that performance could be improved if the employee is provided with adequate training which will increase the instrumentality. Evaluation At a first glance, goal setting theory offers a more objective evaluation since it is based on figures or pre-defined goals which are used to benchmark the actual performance. [...]

[...] On the one hand, if managers do not set high performance expectations, individuals will not produce superior results because aspiration will be low since individuals see that targets can be attained with the minimum of effort, persistence, and creativity. Conversely, if performance targets are set too high, individuals will not perceive them as attainable and they will have no positive motivational effect. In the worst case, they may even serve to demotivate. To this respect, psychological research from Erez and Zidon (1984) suggests a non-linear association between target difficulty and motivation. Above a threshold level of difficulty, motivation appears to increase with target difficulty up to the point where people approach the perceived limits of their ability. [...]