Performance Feedback Transparency

• Applicant: Professor Dr. Ingo Weller
• Subject Area: Operations Management and Computer Science for Business Administration
• Term: since 2023
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 529741405

Performance management (PM) is among the most critical, yet also most contentious, HR functions. While PM serves as the foundation for pay, development, and other people-focused processes, employee performance ratings tend to be cloaked in secrecy. Such secrecy has the potential to contribute to biases, and foster gender and ethnic pay disparities, unequal employment opportunities, and inequality and social injustice more broadly. A central aspect of PM is performance feedback. Given the social justice issues involved, scholars and policy makers have suggested that performance feedback should be more transparent: organizations should increase the extent to which employees are given information not only about their own absolute levels of performance, but that of relevant others as well. However, the effects and mechanisms of such performance feedback transparency (PFT) remain largely unknown. The proposed Middle East Cooperation study seeks to fill this gap by offering and empirically testing a parsimonious, theory-grounded model that explains (a) how PFT can elicit both positive and negative performance consequences at the individual-level and unit-level, and (b) when and for whom beneficial consequences are likely to outweigh adverse consequences. In the model that we propose to test, we integrate two opposing streams of theory, with one stream proposing negative consequences of feedback transparency driven by a status-focus, and the other proposing more positive consequences driven by a learning-focus. We further propose three contingency factors likely to regulate the relative strength of PFT’s potential beneficial vs. adverse effects, namely (a) the strength of the narrative accompanying feedback, (b) an individual’s relative performance position, and (c) an individual’s tenure. We aim to test our hypotheses in a multi-study project. A laboratory experiment will test the causal, indirect effects of PFT on individual-level task and contextual performance. A quasi-experimental field study will test the individual- and unit-level hypotheses and assess the generalizability of the results of the laboratory study. Integrating opposing perspectives and examining possible moderators, we address significant theoretical gaps in the extant literature. Our results will also provide managers with evidence-based insights on how to enhance the design and functioning of PM systems.

• DFG Programme: Research Grants
• International Connection: Israel
• International Co-Applicant: Professor Peter Bamberger, Ph.D.