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Perceived Purposes of Performance Appraisal: Correlates of Individual- and Position-Focused Purposes on Attitudinal Outcomes
Satoris S. Youngcourt, Pedro I. Leiva, Robert G. Jones

Performance appraisals have traditionally been directed at individuals, serving either an administrative or developmental purpose. They may serve a role denition purpose as well. This study sought to identify and more broadly dene the purposes of performance appraisals to include this role denition purpose. Furthermore, this study examined purposes of performance appraisals as perceived by the role incumbent, as opposed to the stated organizational purposes. The relationships between these perceived purposes with several attitudinal outcomes, including satisfaction with the performance appraisal, job satisfaction, affective commitment, and role ambiguity, are reported. Data from 599 retail service employees were used to test the hypothesized relationships. Results suggested support for a model consisting of three performance appraisal purposes having differential relationships with the outcomes examined, suggesting the purpose of the performance appraisal may inuence ratees perceptions of and attitudes toward their jobs. Over two decades ago, Bernardin and Beatty (1984) identied many interdependent purposes of performance appraisal, including to improve the use of resources and serve as a basis for personnel actions. Similarly, Cleveland and
A previous version of this article was presented at the annual meeting of the Academy of Management, New Orleans, Louisiana, in August 2004.
HUMAN RESOURCE DEVELOPMENT QUARTERLY, vol. 18, no. 3, Fall 2007 Wiley Periodicals, Inc. Published online in Wiley InterScience (www.interscience.wiley.com) DOI: 10.1002/hrdq.1207
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colleagues (Cleveland, Mohammed, Skattebo, & Sin, 2003; Cleveland, Murphy, & Williams, 1989) have shown that in practice, performance appraisals appear to be directed to four purposes: to make distinctions among people, distinguish a persons strengths from his or her weaknesses, implement and evaluate human resource systems in organizations, and document personnel decisions. Indeed, yet another goal of performance appraisals may ultimately be to increase performance at the individual and, subsequently, the organizational level (see DeNisi & Gonzalez, 2000; Meyer, Kay, & French, 1965). These distinctions among purposes of the performance appraisal are important for human resource development (HRD) research and practice for many reasons. Once performance ratings are made, the adequacy of management decisions about how to develop, reward, train, and otherwise attempt to affect the behavior of job incumbents is at stake. Having a clear idea about the links between initial rating decisions and later administrative and developmental decisions has been a major focus of considerable research literature (DeNisi & Gonzalez, 2000; Murphy & Cleveland, 1995). Because the purpose of performance appraisal is one of the factors that affect the characteristics and quality of the ratings, the practical implications of this research for professionals have included numerous attempts to improve performance ratings and measurement. For example, as numerous researchers have demonstrated, the purpose of the appraisal affects rating processes and outcomes (Bernardin & Beatty, 1984; DeNisi, Cafferty, & Meglino, 1984; Murphy, Balzer, Kellam, & Armstrong, 1984; Sharon & Bartlett, 1969; Williams, DeNisi, Blencoe, & Cafferty, 1985; Zedeck & Cascio, 1982). Appraisals conducted for developmental purposes, for example, are less prone to rating biases (say, elevation or leniency) than are appraisals conducted for administrative decision-making purposes (Meyer et al., 1965; Zedeck & Cascio, 1982). The most common purposes of performance appraisal tend to be aimed at the measurement of individuals, with the focus being on distinguishing either among individuals (the administrative purpose) or within individuals (the developmental purpose; Cleveland et al., 1989, 2003). This emphasis on individual-focused purposes, however, may be insufcient. The uncertain business environment that contemporary companies face has forced researchers and practitioners to conceptualize organizations as open systems with objectives and goals that continually need to adapt to the changing environment (Katz & Kahn, 1979; Schneider & Klein, 1994). Furthermore, from a more macro strategic perspective, the resource-based view of the rm (Barney, 1991; Barney, Wright, & Ketchen, 2001) has challenged traditional views of companies. This view proposes that the competitive advantage of a company depends on how valuable, rare, difcult to imitate, and difcult to replace are its resources. From this perspective, certain human resources are a cornerstone for the development of the companys core competencies, on which the company invests the most. This has forced researchers to identify employees
HUMAN RESOURCE DEVELOPMENT QUARTERLY DOI: 10.1002/hrdq
Perceived Purposes of Performance Appraisal
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as a source of competitive advantage in unstable business environments (Barney, 1991; Barney et al., 2001), especially employees who are highly valuable and unique for the companys core competency (Lepak & Snell, 1999). In this context, employees may play a role in the denition of their own jobs. Popular human resource practices such as quality circles (Schneider, Brief, & Guzzo, 1996) have demonstrated that incumbents are aware of their environment and are able to capture customer needs and propose changes in the work design and their own positions, thus improving organizational performance. From this perspective, performance appraisal theory can be expanded to suggest that performance appraisals have a third purpose that is more focused on the position than on the individual within the position. That is, change or clarication of the structure or content of the work associated with a position is an important and relatively overlooked purpose of performance appraisal and likely has a different impact on incumbents than do the traditional administrative and developmental purposes. Research on performance appraisal has tended to focus on how various purposes of performance appraisals inuence the appraiser and the rating outcome, overlooking the impact of the perceived intent of the appraisal on the employee being evaluated. Whereas several researchers have examined employee reactions to the performance appraisal system (Dipboye & De Pontriand, 1981; Mount, 1983), employee attitudes related to the purpose of the appraisal remain relatively unexplored (see Boswell & Boudreau, 2000, for an exception). Thus, another gap that needs to be addressed in performance appraisal theory is the impact that the purpose of the appraisal may have on employee attitudes toward the appraisal and the organization.
Study Purpose
The overarching goal of this article is to expand the traditional way of looking at the purposes of performance appraisal in order to increase managerial understanding of its potential effects and subsequently enhance its use for HRD. Beyond this objective, we have two specic purposes. The rst is to expand performance appraisal theory by identifying and more broadly dening the purposes of performance appraisals to include a position-focused purpose in addition to the traditional incumbent-focused purposes. Although a purpose aimed at role denition has important implications for organizations, it has remained relatively unexplored. The second purpose is to expand performance appraisal theory by examining the differential relationships that employees perceptions of the various purposes have with several criteria of interest (satisfaction, commitment, and role ambiguity). Several researchers have demonstrated that employees perceptions of the workplace are more important than the workplace itself in affecting attitudinal and behavioral organizational responses (Allen, 2001; James & McIntyre, 1996). From this standpoint, two individuals working for
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the same organization could perceive the purpose of the performance appraisal as being completely different. Regardless of the intended purpose of the appraisal, which may in fact serve both purposes, it is the perceived purpose of the appraisal that will likely inuence the employees attitudes toward the performance appraisal process and, ultimately, the organization. Whereby performance appraisals have traditionally held either administrative and developmental purposes, they speak directly to organizational development and individual career development, respectively. Expanding performance appraisal theory to include a third purpose that goes beyond these traditional approaches adds another dimension in which individuals may advance their own careers (by learning what is expected of them, they know where to focus their efforts) and identify areas in which supervisors may choose to offer additional training and development for their employees (for example, when the role denition purpose reveals additional requirements for a job that the incumbent does not already possess). In addition, a purpose aimed at role denition allows information for the organization as a whole to develop because the information gained from this purpose may show how different positions are increasing or decreasing in role breadth, thus indicating where more or fewer resources should be allocated. This additional purpose, aimed at the position rather than at the individual within the position, is clearly an overlooked area of research within the HRD literature. Therefore, we aim to address this gap and provide an understanding of how perceptions of these different purposes relate to important outcomes for organizations.
Literature Review
A review of the literature presents individual- versus position-focused purposes of performance appraisal, theoretical rationale for role denition purpose, and differential relationships of perceived purposes of the performance appraisal. Individual- versus Position-Focused Purposes of Performance Appraisal. From the traditional perspective, performance appraisals have been conceptualized to be intended to change the behavior of the incumbent in a position. Following Campbells model of job performance (Campbell, 1990; Campbell, McCloy, Oppler, & Sager 1993), performance appraisals are aimed at altering the motivation or the knowledge, skills, and abilities (KSAs) of the person in the position (or both). For example, supervisors may give rewards-based feedback based on performance ratings, which is aimed at enhancing motivation of a job incumbent. Or a supervisor may decide to provide training and development to a subordinate based on skills decits identied through performance appraisal. These performance appraisal outcomes have been virtually the entire focus of performance appraisal research, in terms of either accuracy (Landy, Barnes, & Murphy, 1978) or utility (Greller, 1978; Nathan, Morhman, & Milliman, 1991), or more direct measures of behavior intention
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(such as fairness perceptions; Burke, Weitzel, & Weir, 1978; Taylor, Tracy, Renard, Harrison, & Carroll, 1995). But in a dynamic job context, another plausible purpose of performance appraisals may be focused on the position itself rather than on the individual occupying the position. There are several reasons a position-focused purpose may be necessary. For example, the position requirements, for which an incumbent is evaluated in incumbent-focused appraisals, may change. As advancements are made in technology, the requirements for a job are likely to change. And just because the position requirements are changing does not mean that the employee within the position is changing too. Many employees remain in the same positions long after initial requirements have changed and new demands are placed on them. Although some changes are readily apparent, such as the increased use of technology or increasing skills required to perform a task or job, some changes in the job are not as apparent. It is in these latter cases that a position-focused appraisal would be most useful. For example, employees may become accustomed to assisting their fellow employees in ways that slowly transfer the responsibilities of one employees job to that of another. Employees from two separate positions within an organization may realize that although one of them is supposed to be responsible for a particular task, the other actually has more resources (such as time, opportunity, or KSAs) in order to complete the task more efciently or with higher quality. These changes may result without upper managements knowledge or approval and therefore may not be reected in the appraisal system for the two positions (the one with added responsibility, as well as the one with less responsibility). This may be even more the case when employees perform such activities as contextual or citizenship behaviors (Bateman & Organ, 1983; Borman & Motowidlo, 1993; Organ, 1988; Smith, Organ, & Near, 1983). According to Hough and Oswald (2000), organizations clearly require both task and citizenship performance. Because employees may assist each other and complete each others tasks, organizational decision makers would be well served to allow for and accept that jobs will slowly change and task requirements may switch hands. This sort of employee development by position redenition and citizenship may have important effects on both individual attitudes and organizational effectiveness. In the event that employees do become responsible for additional tasks or changes in technology or protocol occur, the performance appraisal should not only reect these changes; they may be a meaningful means for incorporating these changes through the performance review process. At a minimum, an employee should not be punished for not completing aspects of a job that are no longer necessary to fulllment of the purpose of the position. Similarly, an employee should be assessed on aspects of the job that are essential for optimal performance, regardless of whether these tasks were part of an original job description. As long as the manager is aware of changes in position requirements and the employee is accurately assessed on his or her performance in
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the job in its current form, such problems are less likely to arise. The interaction that occurs during feedback following the performance appraisal may be a prime time for discussions of these changes in job and position requirements. In the best instance, the supervisor may choose to alter the position based on a particular strength of a particular incumbent. All of these examples illustrate ways that the performance appraisal itself can be considered an occasion for position, or role, denition. From another point of view, in tight labor markets, only some incumbents may be able to fulll all functions of a position as it has been conceptualized prior to their being employed. In such cases and in lieu of ring, managers may be forced to reduce position expectations in terms of level or number. When done systematically and with full understanding of the specic limitations of incumbents, alterations of the position and its design may serve to accomplish the organizational functions without making unreasonable demands on the incumbents. Similarly, in an uncertain business environment, altering a position to take full advantage of particular incumbents talents may help the organization gain a competitive advantage, if only by retaining a valued incumbent. In summary, in addition to individual-focused purposes of performance appraisals, another possible purpose could be change in the structure of the work associated with the position. From this perspective, performance appraisal outcomes may ultimately lead to training an employee to improve his or her performance (a developmental decision), removing an employee from a position (administrative decisions such as ring, promotion, and layoff ) or altering position requirements (role denition decisions such as reengineering or reorganization). The former cases are akin to the individual-focused developmental and administrative purposes of the performance appraisal; the latter case is more directed at the position, whereby the position itself may be altered in the interest of improving organizational performance or retaining a valuable incumbent. Thus, performance appraisal decisions are oriented toward the effectiveness of the position as a whole, in addition to its subset of individual incumbent effectiveness (DeNisi, 2000; Ilgen, 1993; Murphy & Cleveland, 1992, 1995). Theoretical Rationale for Role Denition Purpose. Some models of job performance (Campbell et al., 1993; Day, Sin, & Chen, 2004) suggest that the determinants of performance include not only abilities and motivations, but peoples declarative knowledge of what is expected of them. In their comprehensive theory of organizational behavior, Katz and Kahn (1979) described this in terms of social information and refer to it as role denition: the extent to which relevant job behaviors are clearly dened within a social environment. To the extent that role expectations are well understood, incumbents may demonstrate both their abilities and the level of effort they exert to meet these expectations. If people do not know what is expected of them, there is a good chance that their behavior will not conform to important others expectations,
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and effort and abilities will not be expressed appropriately in work behavior. Put simply, it is important to be willing and able to do a job, but it is essential to know what is expected in the job. It would be hard to demonstrate ones ability and motivation without a clear idea of how and when to apply them. But where and when do people receive role information in organizations? This question is far from new, as discussed over a quarter of a century ago by Katz and Kahn (1979), who noted, Research on role-sending in organizations has thus far concentrated more on side effects than main effects (that is, role enactment per se) and more on particular inadequacies in the expectational pattern and sending process (conict, ambiguity, overload) than on constructive elements (p. 203). These authors cited Likerts suggestion (1967) that supportive supervision may contribute to effective role enactment. This notion has received attention in the literature on participation in performance appraisal (see Cawley, Keeping, & Levy, 1998). However, the basic construction of roles has received less attention. One possible exception to this is Management by Objectives (MBO; McConkie, 1979; Murphy & Cleveland, 1995), which explicitly requires supervisors and subordinates to negotiate mutually agreeable goals in order to enhance incumbent effectiveness. Although this comes close to describing the role denition purpose, there are notable differences in terms of formality, prescription, and criteria of importance. Using Katz and Kahns terms (1979), MBO is a formal, prescriptive system aimed at individual effectiveness. The role denition purpose, however, may be a more nonnormative, informal part of discussions about performance that follow from the appraisal and are aimed not only at individual effectiveness but at the effectiveness of the position more broadly. That is, the purpose is to alter the position and clarify actual tasks and requirements of the position, not necessarily the agreed-on goals of the manager and employee. In a very rough sense, this role denition purpose acts as an ongoing job or position analysis. In this manner, performance appraisals can serve to identify aspects of the job that are no longer required or areas where job requirements have expanded. We propose that the performance appraisal is an important tool through which employees may receive information regarding their roles and superiors may adjust role expectations. This evaluation, along with discussions with the incumbent about organizational expectations regarding his or her role, is an important opportunity for role denition and adjustment. Differential Relationships of Perceived Purposes of the Performance Appraisal. The second purpose of this article is to examine the differential relationships of the three performance appraisal purposes (administrative, developmental, and role denition purposes), with several attitudinal outcomes of interest (employees commitment, satisfaction, and role clarity or ambiguity). The following sections describe the relationships that would be expected along with the theoretical and empirical justication for these expectations. Although testing the relationships of the different attitudinal outcomes
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considered in this study was not an aim, because previous research has demonstrated that some of the attitudinal outcome variables share a signicant amount of variance, the hypotheses suggested in this study were tested after controlling for some of these relationships. Figure 1 shows the hypothesized model. We next describe the relationships among dependent variables that need to be controlled to test the hypotheses. Then we provide the rationale to expect the three perceived purposes of the performance appraisal system to be correlated. Finally, we present the empirical and theoretical support to suggest the differential relationship between each perceived performance appraisal purpose and each of the dependent variables. Relationships Among Dependent Variables. Numerous studies have demonstrated that job satisfaction correlates positively with commitment (Green, Anderson, & Shivers, 1996; McFarlin & Sweeney, 1992; Mowday, Steers, & Porter, 1979). Nevertheless, because of the difculty of specifying the causal precedence of different affective responses (Mathieu & Zajac, 1990; Meyer, Stanley, Herscovitch, & Topolnytsky, 2002) and the fact that job satisfaction and affective commitment contribute uniquely to withdrawal behaviors such as turnover intentions (Tett & Meyer, 1993), the hypotheses suggested in this study are tested after controlling for the bidirectional relationship between affective commitment and job satisfaction. Role ambiguity has been found to correlate negatively with job satisfaction (Abramis, 1994; Jackson & Schuler, 1985). In this case, because role ambiguity is a variable that captures the perceptions individuals have regarding their Figure 1. Hypothesized Model for the Study
Performance Appraisal Satisfaction
Administrative Purpose
Job Satisfaction Developmental Purpose Affective Organizational Commitment
Role Definition Purpose
Role Ambiguity
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job and job satisfaction is a variable that captures an affective response toward the job, the effect of role ambiguity on job satisfaction will be controlled when testing the hypotheses suggested in this study. Finally, individuals job satisfaction has been researched based on the reports of workers regarding their job in general and with different facets of their job, such as satisfaction with their pay, their supervisor, and the organizational climate. Because satisfaction with the job is broader than satisfaction with individual facets of the job, it is logical to assume that job satisfaction is a more distal variable than is the satisfaction with specic job facets (see Chen, Gully, Whiteman, & Kilcullen, 2000, for similar thinking with general and specic self-efcacy). Thus, job satisfaction can be considered an antecedent of job satisfaction. Because satisfaction with the performance appraisal system can be considered a facet of the job, we posit that this variable has a direct effect on job satisfaction. Relationships Among the Three Perceived Purposes. Researchers (for example, Cleveland et al., 1989, 2003) have found that performance appraisals often serve multiple purposes rather than one sole purpose. Therefore, individuals may perceive, perhaps quite accurately, that the same appraisal is used for multiple purposes. For example, an employee may perceive a performance appraisal as serving a developmental purpose in that it identies his or her strengths and weaknesses, and simultaneously perceive the ratings as being used to determine a raise. Similarly, the employee may perceive the performance appraisal as indicating problems in the position (for example, because of low ratings in an area where the employee lacks control or opportunities to excel), thereby leading to changes in the job. Consequently, the employee may also view the same appraisal as serving a role denition purpose. In this manner, we expect individuals perceptions of any one purpose of the performance appraisal to be related to both of the others. Nevertheless, we maintain that the purposes of performance appraisal are distinct, separate purposes, as conceptualized and demonstrated by previous researchers (Boswell & Boudreau, 2000; Cleveland et al., 1989, 2003; Ostroff, 1993). Effects of Administrative Purpose on Dependent Variables. Administrative decisions can lead to such things as pay increases, bonuses, and promotions, which are often valued outcomes to employees. Thus, it is logical to assume that perceptions of such purposes would be related to job satisfaction. However, we do not expect a direct relationship between the administrative purpose and job satisfaction. Instead, we hypothesize that the relationship between administrative purpose and job satisfaction is mediated by satisfaction with the performance appraisal. As several researchers have noted, a performance appraisal system will be less successful if it is not accepted (Carroll & Schneier, 1982; Murphy & Cleveland, 1995). To the extent employees accept or are satised with the appraisal, they are expected to be more satised with their job in general. That is, a lack of satisfaction
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with the appraisal suggests that employees do not accept the rating or feel the appraisal is not just or accurate, and it may subsequently lead to feelings of overall job dissatisfaction because the valued outcomes are not as likely. Effects of Developmental Purpose on Dependent Variables. We hypothesize a relationship between perceptions of a developmental purpose and affective commitment. Affective commitment has been dened as the emotional bond individuals experience with an organization concerning their involvement in, identication with, and attachment to their organization (Meyer & Allen, 1991). Under the tenets of social exchange theory (Blau, 1964), it is reasonable to expect that if an individual feels the organization is providing support and opportunities for improvement, evidenced by the appraisal being used for developmental purposes, he or she may respond attitudinally. That is, because the organization is viewed as caring for the employee (through the developmental appraisal), the employee will reciprocate with commitment to the organization (Cialdini, 2001). We also posit that perceptions of the performance appraisal as serving a developmental purpose are related to job satisfaction through satisfaction with the performance appraisal. Considering that developmental performance appraisals are aimed at identifying strengths and weaknesses for the purposes of improvement and enhancement, individuals who perceive the appraisal as being used for this purpose may believe the organization is interested in their improvement and well-being. We believe this may be reected in part through their satisfaction with the appraisal. This satisfaction with the appraisal is then expected to lead to job satisfaction. Effects of Role Denition Purpose on Dependent Variables. Because performance appraisals aimed at role denition purposes are dening and clarifying roles, we posit that individuals who perceive the performance appraisal as being for this purpose will have lower levels of role ambiguity. Thus, by denition, if an individual views the appraisal as being at least in part intended for role clarication, then it is likely he or she will experience less ambiguity regarding the expectations of the job. We also posit that individuals who view the purpose of the appraisal as being for the clarication of roles will be more satised with the performance appraisal and consequently more satised with their job. This may result from several mechanisms. First, having a chance to communicate their opinions regarding the expectations and requirements of the job has been shown to have a positive relationship with satisfaction. For example, in a sample of management-level employees, Korsgaard and Roberson (1995) found that both instrumental voice and noninstrumental voice were important in predicting satisfaction with the evaluation. Second, there is some reason to believe that having an opportunity to help craft the job through role denition in performance appraisal may have an effect on satisfaction as well. Using metaanalytic procedures, Spector (1986) found that high levels of perceived control are positively related to job satisfaction. The feedback discussion following the
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performance appraisal may be a good time for employees to be actively involved in the denition of their jobs and may give employees a sense of control over both the performance appraisal process and their job. Although voice and actual control over the process may not truly exist, the perceptions that the appraisal is helping to clarify roles is the key to these affective reactions. Thus, perceptions that the performance appraisal serves a role-denition purpose are expected to relate positively to performance appraisal satisfaction. Satisfaction with the appraisal is believed to then lead to job satisfaction, as we have already noted. We further propose that when individuals perceive the performance appraisal as serving role denition purposes, they will have greater levels of affective commitment. When employees view the performance appraisal being used to make changes in their job, they may feel a sense of ownership and control over the appraisal and the job. Spector (1986) showed that high levels of perceived control are related to greater commitment toward the organization. Consequently we posit that employees will feel a greater sense of commitment toward the organization to the extent that the performance appraisal claries expectations and make necessary changes in the job.
Summary of the Problem and Hypotheses

As part of our overarching goal to expand the traditional way of looking at performance appraisal purposes, we aim to increase managerial understanding of the potential effects of there being a role denition purpose in addition to the traditional purposes. As such, this study posed two primary research questions: (1) Do employees perceive performance appraisals to be used for these three purposes? and (2) How do these different purposes relate to employee perceptions of job satisfaction, satisfaction with the performance appraisal, commitment to ones job, and understanding of the expectations of their role? Boswell and Boudreau (2000) found that the perception of the developmental use of the performance appraisal inuenced employee satisfaction with the performance appraisal and satisfaction with the appraiser but found no such relationship between the perception of evaluative use of performance appraisals and these two attitudinal outcomes. We expand on their research by examining the relationships between perceptions of the two traditional purposes of the performance appraisal (administrative and developmental), as well as the third purpose of role denition that we have proposed. Furthermore, we expand the attitudinal outcomes to include overall job satisfaction, affective commitment, and role ambiguity. In the light of our research questions, and based on the rationale we have outlined, we proposed and tested the following hypotheses: HYPOTHESIS 1. The three performance appraisal purposes are separate but related constructs.
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HYPOTHESIS 2. The relationship between perceptions of an administrative purpose of the performance appraisal and job satisfaction is mediated by satisfaction with the performance appraisal. HYPOTHESIS 3. There is a positive relationship between perceptions of a developmental purpose of the performance appraisal and affective commitment. HYPOTHESIS 4. The relationship between perceptions of a developmental purpose of the performance appraisal and job satisfaction is mediated by satisfaction with the performance appraisal. HYPOTHESIS 5. There is a negative relationship between perceptions of a role denition purpose of the performance appraisal and role ambiguity. HYPOTHESIS 6. The relationship between perceptions of a role denition purpose of the performance appraisal and job satisfaction is mediated by satisfaction with the performance appraisal. HYPOTHESIS 7. There is a positive relationship between perceptions of a role denition purpose of the performance appraisal and affective commitment.
Method
Data for this study were collected as part of a larger examination of the effectiveness of a companys performance appraisal system. Questionnaires were sent through an interstore mail system to all employees and managers at 298 randomly selected automotive parts stores in a single organization. Originally 300 stores were selected, but 2 stores could not be used because they were not yet open. A total of 3,556 questionnaires were distributed to stores in Iowa, Kansas, Missouri, Nebraska, and Texas. Participants were told that this was university-based research designed to evaluate the companys performance appraisal system, that completion of questionnaires was voluntary, and that all individual responses would be kept condential. Participants were given two weeks to return the questionnaire, with an e-mail reminder from human resources sent two days before the deadline. The questionnaires were returned to the human resource department in envelopes marked as condential and were seen only by the researchers responsible for data entry. Participants. A total of 1,047 individuals returned questionnaires, for a response rate of 29 percent. Only individuals classied as employees were included in this study, however, because we were interested in employees perceived purposes of the appraisal, as opposed to the intended purposes of the appraisal. Consequently, managers and respondents who did not report their position were eliminated. From the sample of 643 employees who returned the questionnaires, 559 employees reported complete information for the variables of interest. Most of these respondents were white (79 percent) and male (70 percent), representative of the organization as a whole.
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Measures. We next present each of the measures used in this study. We have organized them by the independent variables (which include the three perceived purposes of the performance appraisal) and the dependent variables (which include the attitudinal outcomes of role ambiguity, job satisfaction, satisfaction with the performance appraisal, and affective commitment). Independent Variables. Perceptions regarding the three purposes of the companys performance appraisal system were measured with nine items: six (three administrative and three developmental) were taken from existing research (Cleveland et al., 1989; Longenecker, Liverpool, & Wilson, 1988), and three role denition purpose items were developed for this study. Response options ranged from 1 (strongly disagree) to 5 (strongly agree). The items taken from previous research were chosen based on how representative they were of the constructs of interests. The items used to assess perceptions of an administrative purpose were (1) Performance appraisals help determine whether to promote, retain or terminate an employee, (2) Performance appraisals determine what raise someone should receive, and (3) The performance appraisal process documents and recognizes employee performance. The items assessing perceptions of a developmental purpose were (4) Performance ratings let employees know where they stand, (5) Performance ratings are used to provide feedback about employee performance, and (6) Performance appraisals identify individual strengths and weaknesses. Finally, the three items selected to measure perceptions of a role denition purpose were (7) Performance appraisals provide information about what employees are responsible for accomplishing, (8) Performance appraisals provide information that helps make positive changes in the job itself, and (9) Performance appraisals provide information about what employees actually do in their jobs. Reliability estimates for administrative, developmental, and role denition purposes were .70, .75, and .73, respectively. Dependent Variables. Three items measuring perception of role ambiguity were taken from Rizzo, House, and Lirtzmans measure (1970) of role denition problems. The three role ambiguity items were (1) I know exactly what is expected of me, (2) I feel certain about how much authority I have on the job, and (3) I know what my responsibilities are. Only three items were used due to space considerations in the nal questionnaire administered. These items were chosen because of their relevance to the construct of interest and because they were among the items with the highest factor loadings in Rizzo et al.s original article (.61, .51, and .61, respectively). Response choices ranged from 1 (strongly disagree) to 5 (strongly agree). All items were reverse-coded to reect ambiguity rather than clarity. The reliability estimate for this scale for the current study was .75. Job satisfaction was measured with three items previously used by Tremble and Alderks (1992). These items were (1) I usually feel that my job is worthwhile, (2) I am interested in my present job, and (3) Overall, I am
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satised with my current job, Response choices ranged from 1 (strongly disagree) to 5 (strongly agree). The reliability estimate for this scale was .81. Satisfaction with the performance appraisal was measured with the following two items: (1) I am pleased with how performance appraisals are handled, and (2) I am generally satised with the performance appraisal process. A response set from 1 (strongly disagree) to 5 (strongly agree) was used. The reliability estimate for this scale was .86. Affective commitment to the organization was assessed using three items from Allen and Meyers affective commitment scale (1990): (1) I really feel as if this companys problems are my own, (2) This company has a great deal of personal meaning for me, and (3) I do not feel emotionally attached to this company, (reverse-coded) with a scale ranging from 1 (strongly disagree) to 5 (strongly agree). Allen and Meyers full eight-item scale was not included due to space limitations in the questionnaire. However, the three items were shown in their original study as being related to a single factor, with loadings of .52, .79, and .81, respectively. The reliability estimate for this scale for the current study was .69.
Analyses and Results

To test the hypothesized model (see Figure 1), analyses of covariance structures were performed in LISREL 8.3 (Jreskog & Srbom, 1993). To control for capitalizing on chance when sequentially introducing modications to the model, we followed MacCallums suggestion (1992), performing the analyses in three sequential steps. In the rst step, tau-equivalent measurement models were estimated for the independent variables and the dependent variables separately using a rst subsample (n 155). In the second step, the hypothesized model was tested with a second subsample (n 197). And in the third step, the results were cross-validated with a third subsample (n 207). These three subsamples were obtained randomly from the original sample. To control for the threat of common method bias due to the crosssectional nature of the data, as recommended by Podsakoff, MacKenzie, Lee, and Podsakoff (2003), all analyses were performed controlling for the effects of a single unmeasured latent method factor. In addition, to control for item carryover effects, we assessed the correlations between the errors of sequential items but retained only the signicant paths for the analyses. To test the appropriateness of the models estimated through the analyses, we provide several indicators of the goodness of t. First, we provide the goodness-of-t index (GFI), which deals with error in reproducing the variance-covariance matrix and should be equal to or greater than .90 to accept the model. However, because GFI tends to be sensitive to the sample size and the distribution of the data, we also provide the comparative t index (CFI), which has been shown to be among the measures least affected by sample size (Fan, Thompson, & Wang, 1999). By convention, the CFI should be .90 or
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greater to accept the model. Another index that we included, which is less affected by sample size and deviations from the normal distribution, is the nonnormed t index (NNFI), in which values below .90 indicate a need to respecify the model, and values .95 and above indicate a good model (Hu & Bentler, 1999). Finally, we use the root mean square error of approximation (RMSEA) as an indicator of goodness of t. Researchers (Hu & Bentler, 1999) have suggested that an RMSEA value of .06 or less indicates good model t, although there is a tendency for it to overestimate goodness of t for small sample sizes (Fan et al., 1999). To test the improvement of the goodness of t of a model when removing (or adding) parameters, we examine the increase of the chi square of the nested model at a level of signicance of .05. Therefore, if a path is removed from a model and the increase on the chi square is not signicant, the more parsimonious model is considered a better solution. Table 1 shows scale means, standard deviations, reliability coefcients, and intercorrelations among the variables of interest. As shown, the correlations among variables were all signicant at a level of .01 even after controlling for common method variance, which tends to contribute to inated correlations. Independent Variables Measurement Model. We rst estimated the independent variables measurement model assuming tau equivalence among the items for each scale. To do this, a three-factor model underlying the nine performance appraisal purpose items was estimated with a four-factor conrmatory factor analysis (CFA), which controlled for a single unmeasured latent factor. In this analysis, the paths between the items and their hypothesized factor, as well as the paths between each item and the unmeasured latent factor, were constrained to be equal, the correlations among the three hypothesized factors were left free for estimation, and the correlations of the three factors with the fourth single unmeasured latent method factor were constrained to zero. Also, the correlations between the errors of two pairs of sequential items were left free Table 1. Descriptive Statistics, Reliabilities, and Correlations for the Variables Examined
M 1. Administrative purpose 2. Development purpose 3. Role denition purpose 4. Affective commitment 5. Job satisfaction 6. Role ambiguity 7. Performance appraisal satisfaction 3.65 3.84 3.60 3.32 3.95 4.00 3.39 SD 1 2 3 4 5 6 7 0.72 (.70) 0.62 .73 (.75) 0.70 .60 .67 (.73) 0.86 .36 .37 .40 (.69) 0.71 .39 .46 .45 .48 (.81) 0.67 .31 .42 .36 .29 .48 (.75) 0.98 .43 .43 .49 .39 .45 .30 (.86)
Note. N 599. All correlations are signicant at a level of .01. Reliability coefcients are along the diagonal.
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for estimation to test the presence of item carry-over effects. To test hypothesis 1, the goodness of t for this model was compared with (1) one two-factor model with one common factor (representing administrative, developmental, and role denition purposes combined into a single purpose) and a second single unmeasured latent method factor, and (2) three three-factor models obtained with all possible combinations of two of the three factors (administrative and developmental combined versus role denition separate, developmental and role denition combined versus administrative separate, and administrative and role denition purposes combined versus developmental separate) and a third single unmeasured latent factor. After testing for the appropriateness of the hypothesized three-factor structure, the loadings obtained for the items in each scale and the correlations among the three factors were retained to constrain these paths when testing the hypotheses with the second subsample. The four-factor CFA performed on the nine independent variable items yielded an appropriate t. However, because the correlations between the errors of two pairs of consequential items were not statistically signicant, the model was estimated again without leaving free for estimation those parameters. As shown in Table 2, when compared with the two-factor solution, in which all the items were associated with one common factor and a single unmeasured latent factor, the four-factor solution resulted in a statistically signicant chi-square increase, suggesting that the hypothesized solution has a better t. Furthermore, change in chi square was statistically signicant when compared with any of the possible combinations of the three-factor model. The four-factor solution showed that each of the three perceived administrative purpose items loaded 0.59 on their latent factor, the three perceived developmental purpose items each loaded 0.55 on their factor, and the perceived role denition purpose items all loaded 0.66 on their factor. In addition, as expected, the three hypothesized factors were highly correlated. Specically, the correlation between perceived administrative purpose and perceived developmental purpose factors was .98, the correlation between the perceived developmental purpose and the perceived role denition purpose factors was .92, and the correlation between the perceived developmental purpose and the perceived role denition purpose factors was .76.
Table 2. Independent Variables Measurement Models Goodness-of-Fit Indexes

Models Four factors Two factors
2
df
GFI
CFI
NNFI RMSEA 1.00 .96 .014 .007
2*
df 3
p .00
30.95 30 .42 .96 1.00 57.51 33 .00 .92 .98
26.56
Note: GFI goodness-of-t index; CFI comparative t index; NNFI RMSEA root mean square error of approximation.
nonnormed t index;
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The strong correlations among the three purposes can be explained to some extent by the statistical technique used to perform the analysis. Because covariance structural analysis is a statistical technique in which the error of measurement is considered and partialed out from the item variances when analyses are performed, the correlations between latent factors tend to be much stronger than the zero-order correlation obtained from the scale scores. In this case, the correlation between administrative purpose and developmental purpose, initially estimated as being .73 when error of measurement is not removed, is .97 after correcting for the item error of measurement. In addition, the correlation between developmental purpose and role denition purpose, initially estimated as being .67, is .92 after controlling for the item error of measurement. Finally, the correlation between administrative purpose and role denition purpose, initially estimated as being .60, is .76 after controlling for the error of measurement. Despite the strong correlations among the independent variables, the fact that the four-factor measurement model (three hypothesized factors and a single unmeasured latent factor) demonstrated statistically better t than any other possible factor structure gives strong support for our rst hypothesis. Thus, it appears that the three perceived performance appraisal purposes, although highly correlated, are empirically distinct. Dependent Variables Measurement Model. In the second set of analyses, similar to the procedure used to estimate the independent variables measurement model, a series of CFAs was performed to test the appropriateness of the hypothesized four-factor solution for the dependent variable items (that the four dependent variablesjob satisfaction, satisfaction with the performance appraisal, affective commitment, and role ambiguityare all separate constructs). In this case, a four-factor model underlying the eleven dependent variable items was estimated performing a ve-factor CFA, which controlled for a single unmeasured latent factor (to control for the threat of common method bias, as described earlier). As with previous analyses, the paths between the items and its hypothesized factor and those between each item and the unmeasured latent factor were constrained to be equal, the correlations among the four hypothesized factors were left free for estimation, and the correlations of those factors with the fth single unmeasured latent method factor was constrained to zero. Also, the correlations between the errors of two pairs of sequential items were left free for estimation. The goodness of t for this model was compared with (1) a two-factor model with one common factor (all dependent variable items loading on the same factor) and a second single unmeasured latent method factor, (2) six possible four-factor models obtained with all combinations of three out of four factors and a fourth single unmeasured latent factor, and (3) seven possible three-factor models obtained with all combinations of two out of the four factors and a third single unmeasured latent factor. After testing for the appropriateness of the hypothesized three-factor structure, the loadings obtained for the items in each scale were retained to constrain these paths when testing the hypotheses with the second subsample.
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The ve-factor CFA performed with the eleven dependent variable items obtained an appropriate goodness of t. This analysis also showed that the error of the two pairs of sequential items was not statistically signicant, so the analysis was performed constraining to zero the relationship between their errors of measurement. Table 3 shows that when a two-factor solution in which the eleven items load on a common factor and a single unmeasured latent factor was compared to the hypothesized factor structure, the increase in chi square was statistically signicant, suggesting that the hypothesized factor structure had a better t than the alternative factor structure. Furthermore, the comparison of the hypothesized factor structure with all other possible alternative factor structures demonstrated that the hypothesized model yielded better t than any other possible factor structure. In terms of specic factor loadings, the hypothesized ve-factor solution showed that the three commitment items each loaded 0.72 on their latent factor, the three satisfaction items loaded 0.62 on their factor, the role ambiguity items all loaded 0.65 on their factor, and the satisfaction with performance appraisal items loaded .90 on their latent factor. Structural Equation Model: Testing the Hypotheses. After estimating the independent variable and dependent variable measurement models separately, using the second subsample, we assessed the hypothesized relationships between the independent and dependent variables estimating a null model, in which the paths between all the latent exogenous factors and the latent endogenous factors were constrained to zero, while the hypothesized relationships between dependent variables were left free for estimation. In order to estimate the suggested bidirectional relationship between organizational commitment and job satisfaction, the beta paths between these two variables were constrained to be equal. The results obtained for each of these paths were retained to test the hypothesized model. Then we assessed the goodness of t of the hypothesized model structure with all the proposed relationships. Parameter estimates were reviewed and modication indexes explored to test each of the remaining six hypotheses. Once the nal model was identied, the solution was compared with a competing model, in which all the paths between the latent exogenous factors and the latent endogenous factors were left free for estimation. The nal solution was cross-validated using the third subsample.
Table 3. Dependent Variables Measurement Models Goodness-of-Fit Indexes

Models Five factors Two factors
2
df 45 51
p .00 .00
GFI .90 .74
CFI .96 .77
NNFI .95 .65
RMSEA .08 .17
2*
df 6
p .00
94.66 298.46
203.81
Note: GFI goodness-of-t index; CFI comparative t index; NNFI RMSEA root mean square error of approximation.
nonnormed t index;
333
The estimation of the null model showed that the suggested relationships were statistically signicant. The bidirectional relationship between organizational commitment and job satisfaction was .22, the effect of satisfaction with performance appraisal on job satisfaction was .22, and the effect of role ambiguity on job satisfaction was .42. Therefore, the hypothesized model shown in Figure 1 was estimated with structural equation modeling techniques, leaving free for estimation the hypothesized relationships between exogenous and endogenous latent variables. In this way, the parameter estimates suggested that the solution was not appropriate. That is, several estimated paths were not signicant, and the estimation of simultaneous relationships forced the model to overestimate some of the parameters. One of the explanations for the overestimation of the parameters is the high correlations among the independent variables, which leave little variance to estimate the relationships with the dependent variables. Therefore, we had to adopt a different strategy to test the hypotheses. First, we estimated an alternative model in which the administrative purpose (satisfaction with performance appraisal), developmental purpose (affective commitment), and role denition purpose (role ambiguity) paths were included. Second, we estimated the increase in the chi square when each of the other hypothesized relationships was successively included in the model. The suggested alternative model obtained acceptable goodness of t (x2(186) 288.67, p .01, GFI .86, CFI .96, NNFI .96, RMSEA .05). This provided support for hypothesis 3, which suggested that perceived developmental purpose was signicantly related to affective commitment, and support for hypothesis 5, which suggested that perceived role denition purpose was signicantly related to role ambiguity. To test hypotheses 2, 4, 6, and 7, we compared this alternative model successively with other models to test each of our hypotheses. When the direct path between administrative purpose and job satisfaction was included in the model, the increase in chi square was not statistically signicant, suggesting that the relation between perceived administrative purpose and job satisfaction was fully mediated by satisfaction with the performance appraisal system (x2(185) 285.15, p .01, GFI .86, CFI .96, NNFI .96, RMSEA .05, dx2(1) 3.42, p .06). This provides full support to hypothesis 2, which suggested that the perceived administrative purpose of performance appraisal is related to job satisfaction and mediated by satisfaction with the performance appraisal. When the relationship between perceived developmental purpose and job satisfaction was included in the alternative model, the increase in chi square was not statistically signicant (x2(185) 285.60, p .01, GFI .86, CFI .96, NNFI .96, RMSEA .05, dx2(1) 3.07, p .08). Furthermore, when the path between perceived developmental purpose and satisfaction with the performance appraisal was included in the alternative model, the increase in chi square was not statistically signicant (x2(185) 285.16, p .01, GFI .86,
334
CFI .96, NNFI .96, RMSEA .05, dx2(1) 3.51, p .06). Thus, hypothesis 4, which suggested that the relationship between perceived developmental purpose and job satisfaction was mediated by satisfaction with performance appraisal, was not supported. When the relationship between the perceived role denition purpose and job satisfaction was included in the alternative model, the increase in chi square was not statistically signicant (x2(185) 286.80, p .01, GFI .86, CFI .96, NNFI .96, RMSEA .05, dx2(1) 1.07, p .17). In addition, the inclusion of a path between perceived role denition purpose and satisfaction with the performance appraisal into the alternative model did not yield a statistically signicant increase in chi square (x2(185) 287.06, p .01, GFI .86, CFI .96, NNFI .96, RMSEA .05, dx2(1) 1.61, p .21). Thus, we found no support for hypothesis 6, which suggested that the relationship between perceived role denition purpose and job satisfaction was mediated by satisfaction with the performance appraisal. Finally, when the relationship between the perceived role denition purpose and affective commitment was included in the alternative model, the chi-square increase was not statistically signicant (x2(185) 288.65, p .01, GFI .86, CFI .96, NNFI .96, RMSEA .05, dx2(1) 0.02, p .89). Therefore, hypothesis 7, which suggested a signicant relationship between perceived role denition purpose and affective commitment, was not supported. The total unstandardized effects of the exogenous variables on the endogenous variables showed that perceived administrative purpose had a signicant and strong effect on satisfaction with performance appraisal (.53), a signicant but small effect on job satisfaction (.14), and a signicant but very small effect on affective commitment (.03). Perceived developmental purpose had a signicant and strong effect on affective commitment (.49) and a signicant but small effect on job satisfaction (.11). Finally, perceived role denition purpose had a signicant and moderate effect on role ambiguity ( .33), signicant but small effect on job satisfaction (.15), and signicant but very small effect on affective commitment (.03). Figure 2 shows the completely standardized solution for the nal model. To test the stability of the nal model, a cross-validation was performed with the third subsample. The model t was marginally acceptable (x2(186) 415., p .01, GFI .81, CFI .93, NNFI .93, RMSEA .07), and all paths between the exogenous variables and endogenous variables were significant at a level of .05. This result offers stronger support for the already supported hypotheses: 1, 2, 3, and 5.
Discussion
Our rst objective was to identify and more broadly dene the purposes of performance appraisals. In addition to the traditional administrative and developmental purposes aimed at incumbent performance management, we
Perceived Purposes of Performance Appraisal Figure 2. Completely Standardized Solution for the Final Model
Performance Appraisal Satisfaction .22 .98 Job Satisfaction .22 .47 .92
335
Administrative Purpose
.58
.76
Developmental Purpose
Affective Organizational Commitment
.42
Role Definition Purpose
.33
Role Ambiguity
proposed that another purpose of the appraisal may be directed toward dening the position itself: a role denition purpose. We assessed employee perceptions of these three performance appraisal purposes and found that performance appraisal systems were not only perceived to provide information regarding the employees administrative future and their own development, but also were directed at the position as a whole within its organizational context. Although we expected the three purposes to be correlated with one another, they were correlated to a greater extent than is ideal. Specically, the two individual-focused purposes were the most correlated (.98), followed by the relationship between developmental purpose and role denition purpose (.92), and then the relationship between administrative purpose and role definition purpose (.76). We assert, however, that they are still separate constructs for several reasons. First, although they are the highest correlations within this article, previous researchers have demonstrated that the two individual-focused purposes (administrative and developmental) are empirically distinct. Given that these two purposes are both individual focused, it is not altogether surprising that they are highly correlated. The distinction between these two purposes, however, is not the focus of this study. The high correlations between the role denition purpose and the other two purposes are the primary concern here. Nevertheless, they are clearly separate from a theoretical stance. Furthermore, we refer to previous studies (Bosson & Swann, 1999; Chen, Gully, & Eden, 2004) that also had high correlations between their constructs
336
of interest. Specically, Bosson and Swann (1999) found that peoples feelings of self-liking and self-competence were highly correlated with one another (.76) yet independently related to self-verication strategies. Similarly, Chen et al. (2004) found that general self-efcacy and self-esteem were highly correlated (.80) but were considered to be empirically and conceptually distinguishable because they related to task performance in predictably distinct processes. Thus, in both examples, although highly intercorrelated, they were considered to be distinct constructs because they were differentially related to outcomes of interest or related in manners that were predictably different. Also, the error of measurement is considered and partialed out from the item variances when analyses are performed using covariance structural analysis; thus, the correlations between latent factors are inated compared to what one would nd with zero-order correlations. Indeed, our analyses comparing models indicate that the three purposes are best thought of as being empirically distinct. Therefore, although they are highly intercorrelated, they can be considered separate constructs. The second objective of this study was to examine the differential relationships these various purposes have with several criteria of interest. We hypothesized numerous relationships and tested these using structural equation modeling techniques. Although the rst model did not support all of our specic predictions, the model supported our overall propositions: (1) employees distinguish among the three proposed performance appraisal purposes, and (2) the perceptions of different purposes for the performance appraisal system are related differentially to the different attitudinal variables. Our results suggest that the perception of each of the three purposes of performance appraisal systems relates differently to attitudinal outcomes. Specically, perceived administrative purpose was related to job satisfaction through satisfaction with the performance appraisal; perceived developmental purpose yielded direct relationships with job satisfaction and affective commitment; and perceived role denition purpose was directly related to role ambiguity, which related to job satisfaction. Implications for HRD Research and Practice. This study contributes to HRD research and practice in several ways. In terms of implications for HRD research, our second objective at least begins to answer Cleveland et al.s long overdue call (1989) for more research on the correlates and consequences of using performance appraisals for potentially conicting uses. Future research is needed to explore the consequences of using performance appraisals for multiple purposes. An extension of these effects to nonattitudinal consequences might be particularly useful. Along these lines and in line with implications for HRD practice, to the extent that there are any differences in the perceived purpose of the performance appraisal, employers may want to be clearer in communicating the intended purpose of the system depending on the outcome they hope to achieve. For example, in times of change, managers may nd that employees are confused about what their actual job
337
responsibilities entail. Under these conditions, managers may want not only to build a role denition purpose into the performance review system but to communicate this intent to employees in order to increase employee perceptions of role clarity. Another implication for our study with HRD research and practice involves the criteria that we chose to use. The criteria of interest in this study (satisfaction, commitment, and role ambiguity) are primarily attitudinal variables, which have broad implications for their responses to individual development systems, organizational development, and ultimately organizational effectiveness. Employees attitudes, especially to the organization, are increasingly relevant for companies in the contemporary unstable and competitive business environment. It has been demonstrated that organizational attitudes predict turnover (Griffeth, Hom, & Gaertner, 2000), which may hurt company performance from at least two standpoints. In the short term, turnover has a nancial impact on an organization because of the costs associated with recruiting, selecting, hiring, and training a new employee (Abbasi & Hollman, 2000). Moreover, these costs are usually higher for valuable and unique human resources, which demand more investment (Lepak & Snell, 1999, 2002). Turnover also has a nancial impact on the organization in the long term, as it may represent a loss of a companys competitive advantage when valuable, rare, hard-to-replace, and inimitable employees leave the company (Barney, 1991; Barney et al., 2001). Our research also provides recommendations regarding perceptions of appraisals that individuals may have. This research focused on employee perceptions of performance appraisal purposes rather than on actual intended purposes of the appraisals, as designated by the organization. Therefore, our results support the importance of employee perceptions, regardless of actual use, a nding that is similar to that of Boswell and Boudreau (2000). Depending on the outcomes they are interested in (for example, role clarity versus affective commitment), organizations could make certain aspects of the performance appraisal process clear so that employees understand and believe that the appraisal is truly for that purpose, such as personal and career development. However, we echo Boswell and Boudreaus recommendation (2000) that organizations should be mindful in matching employee perceptions to what the organization is really doing in order to avoid possible feelings of manipulation or injustice. Finally, HRD practitioners may want to take note of the versatility that a third purpose offers: it allows many different decisions to be made from the same evaluation (such as whom to promote, areas for employee development, or what parts of the job to restructure). For example, in tight labor markets, only some incumbents may be able to fulll all functions of a position as it has been conceptualized prior to their being employed. In such cases, and especially where training is not feasible because costs are too high or no trainers are available, for example, managers may be forced to reduce position expectations
338
in terms of level or number. When done systematically and with full understanding of the specic limitations of incumbents, alterations of the position and its design may serve to accomplish the organizational functions without making unreasonable demands on the incumbents. Similarly, in an uncertain business environment, altering a position to take full advantage of particular incumbents talents may help the organization gain a competitive advantage, if only by retaining a valued incumbent. Thus, this broader conceptualization of the purposes of the performance appraisal may be advantageous to employees within the positions as well as the organization as a whole. Strengths, Limitations, and Future Research. This study has several strengths. First, data were obtained from employees within a single organization across the Midwest. By limiting the sample to a single organization, we can be assured that relationships between the perceived purposes of the appraisal and the attitudinal outcomes are truly representing the perceptions and are not confounded by the actual purpose of the appraisal. That is, the actual purpose of the performance appraisal did not vary by store in this organization, although clearly the perceived purposes varied in their relationships with outcomes. Another strength is that the relatively large sample that was available allowed us to perform cross-validations, in order to account for several potential problems, including common-method bias and item carry-over effects. An even larger sample size would have been ideal because larger subsamples may have prevented instability in the expected relationships among variables. Still, the representativeness of a sample to the overall organization was certainly a strength. Yet another strength is the use of covariance structure analysis to test our seven hypotheses. This statistical analysis allows us to test multiple relationship hypotheses at the same time while controlling for type 1 error, which is inated when multiple relationships are tested sequentially using different statistics (as in typical regression techniques used to test mediation, for example). This study is not without limitations. First, although we maintain that the three purposes are distinct, as demonstrated by the criterion-related validity and results of the structural equation models provided, they were still correlated to a greater extent than is ideal. Nevertheless, future researchers may want to consider using different items that are even more distinct. In addition, researchers may want to focus on whether there are differences between actual and perceived purposes and whether there is less of a distinction when considering employee perceptions. Unfortunately, we did not collect data on the actual uses of the performance appraisal and are therefore unable to examine this within the current study context. Another limitation with our study was that all data were cross-sectional, and therefore we are unable to infer causality. For example, satised and committed employees may perceive performance appraisals purposes differently, rather than the perception of purpose driving satisfaction and commitment. Clearly a longitudinal design would need to be employed in the future versus
339
the cross-sectional one used in the current study. In addition, although our nal sample size was more than sufcient, our response rate (29 percent) was somewhat lower than we would have liked. That is, although some researchers (among them, Steeh, 1981) have noted that for most mailed surveys, a response rate of 10 percent is typical and 20 percent is the best that can usually be expected, others (including Baruch, 1999; Kerlinger, 1986) have set the typical response rate at closer to 40 or 50 percent. Nonetheless, despite efforts to increase the return rate (reminder e-mails and organizational support), our response rates remained somewhat low. Future researchers may want to consider offering incentives or conducting data collection on-site in order to achieve higher response rates. Two other limitations in this study concern our measures. First, our measure of role denition does not clarify for whom role denition is intended. For example, the items for this purpose all say, Performance appraisals provide information . . . , but they do not state the target of this provided information. It could be that information provided primarily to the organization would serve as documentation function, whereas information provided to the manager-employee dyad actually leads to a renegotiation of the role itself. Thus, although the performance appraisal purpose questions were constructed in the same fashion, the role denition purpose scales could have included the target of the provided information. A second limitation concerns our measure of satisfaction with the performance appraisal not clearly differentiating between satisfaction with the process and satisfaction with the outcome. These two components are embedded within the scale, with satisfaction with the process implied in the rst item and satisfaction with the process and outcome in the second item. Thus, it is not possible to separate out these different elements of the performance appraisal. This was not a key component of our study, however, and thus was not deemed to be a substantial limitation. Nevertheless, future researchers should measure process and outcome satisfaction separately and build the two variables into the theoretical model. Finally, we limited the outcome variables used in this study to attitudinal variables. Although the focus of the research is on the purposes of the performance appraisal, not on the outcomes themselves, future research in this area may benet from moving beyond attitudinal outcome variables. That is, although we addressed outcomes that are quite relevant for contemporary companies and have been linked with numerous important outcomes, it would be worthwhile to examine such aspects as individual and rm performance. In addition, performance ratings would be interesting to examine within the framework used here. For example, one could argue that the relationship between the perceptions people have regarding the performance appraisal system and attitudinal variables may be moderated by previously obtained performance appraisals ratings (Boswell & Boudreau, 2000, 2002). Unfortunately, this information was not available for the study examined here.
340 References
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Satoris S. Youngcourt is assistant professor of psychology at Kansas State University. Pedro I. Leiva is professor of psychology at P. Universidad Catolica de Valparaso in Chile. Robert G. Jones is associate professor of psychology at Missouri State University.

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Perceived Purposes of Performance Appraisal: Correlates of Individual- and Position-Focused Purposes on Attitudinal Outcomes

Satoris S. Youngcourt, Pedro I. Leiva, Robert G. Jones

Youngcourt, Leiva, Jones

Perceived Purposes of Performance Appraisal

Youngcourt, Leiva, Jones

Perceived Purposes of Performance Appraisal

Youngcourt, Leiva, Jones

Perceived Purposes of Performance Appraisal

Youngcourt, Leiva, Jones

Job Satisfaction Developmental Purpose Affective Organizational Commitment

Role Definition Purpose

HUMAN RESOURCE DEVELOPMENT QUARTERLY DOI: 10.1002/hrdq

Perceived Purposes of Performance Appraisal

Youngcourt, Leiva, Jones

Perceived Purposes of Performance Appraisal

Summary of the Problem and Hypotheses

Youngcourt, Leiva, Jones

Perceived Purposes of Performance Appraisal

Youngcourt, Leiva, Jones

Analyses and Results

Perceived Purposes of Performance Appraisal

Youngcourt, Leiva, Jones

Table 2. Independent Variables Measurement Models Goodness-of-Fit Indexes

NNFI RMSEA 1.00 .96 .014 .007

30.95 30 .42 .96 1.00 57.51 33 .00 .92 .98

Perceived Purposes of Performance Appraisal

Youngcourt, Leiva, Jones

Table 3. Dependent Variables Measurement Models Goodness-of-Fit Indexes

GFI .90 .74

CFI .96 .77

NNFI .95 .65

RMSEA .08 .17

Perceived Purposes of Performance Appraisal

Youngcourt, Leiva, Jones

Affective Organizational Commitment

Role Definition Purpose

Youngcourt, Leiva, Jones

Perceived Purposes of Performance Appraisal

Youngcourt, Leiva, Jones

Perceived Purposes of Performance Appraisal

Youngcourt, Leiva, Jones

HUMAN RESOURCE DEVELOPMENT QUARTERLY DOI: 10.1002/hrdq

Perceived Purposes of Performance Appraisal

HUMAN RESOURCE DEVELOPMENT QUARTERLY DOI: 10.1002/hrdq

Youngcourt, Leiva, Jones

HUMAN RESOURCE DEVELOPMENT QUARTERLY DOI: 10.1002/hrdq

Perceived Purposes of Performance Appraisal

HUMAN RESOURCE DEVELOPMENT QUARTERLY DOI: 10.1002/hrdq

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