Managerial Discretion in the Use Of Self-Ratings in an Appraisal System: The Antecedents And Consequences

The strong position taken by Campbell and Lee (1988) regarding the limited usefulness of self-appraisals as an evaluation tool (Folger and Lewis, 1995) has elicited doubts about the use of self-ratings in the performance appraisal process. The leniency effect associated with self-ratings (Farh and Dobbins, 1989; Harris and Schaubroeck, 1988) raises concern about the legitimacy of using self-ratings, and sets the stage for possible disagreement between superiors and subordinates. However, studies of performance appraisal systems consistently indicate the importance of ratee involvement in the appraisal process (Landy et al., 1978; Dipboye and de Pontbriand, 1981; Greenberg, 1986; Folger and Konovsky, 1989; Cawley et al., 1998), providing indirect support for the use of self-appraisals. Furthermore, the traditional top-down appraisal system is clearly inconsistent with the trends toward employee involvement, suggesting that a performance appraisal interview based on an employee's self-rating is more appropriate than a discussion based only on the performance evaluation conducted by a manager (Meyer, 1991; Baruch, 1996). Early work by Bassett and Meyer (1968) reported that the subordinates who self-rated were generally positive about the self-appraisal approach and were more likely to see their manager's criticism of their performance as warranted when compared to those subordinates who were not given an opportunity to self-rate. More recently, Roberson et al. (1993) conducted a field experiment to investigate the impact of a "both-rate" self-appraisal (superior and subordinate independently completed ratings) where subordinates were randomly assigned to a "self-rate" or "no self-rate" condition. Roberson et al. (1993) hypothesized that individuals assigned to the self-appraisal condition would report greater satisfaction with the appraisal interview, greater understanding of their manager's expectations and perceive the procedure to be fairer than those individuals who did not self-evaluate. These hypotheses were not supported. However, an unexpected finding emerged. Roberson et al. (1993) found that individuals in the "no self-rate" group who performed an informal self-rating were more satisfied with the appraisal, and felt their ratings were fairer than individuals who did not self-rate. The results of the Roberson et al. (1993) study are not consistent with the oft-cited work of Bassett and Meyer (1968). There is a significant difference in the research design of the two studies. In the Bassett and Meyer study, individuals who self-evaluated did not receive a performance evaluation from their superiors; performance appraisal discussions were based solely on the subordinate's self-evaluation. In the Roberson et al. (1993) study, appraisal discussions were centered on the self-appraisals and the formal evaluation of their superiors. As noted by Campbell and Lee (1988), this situation may create the possibility for conflict. Roberson et al. (1993) surmise that formal self-ratings tend to raise employee expectations, while informal self-ratings may not have the same effect. In addition, formal self-ratings may be instituted in an environment where little employee participation has been allowed, while informal self-ratings are more likely to occur when individuals feel comfortable providing input. Given the concerns related to leniency effects and increased expectations of self-ratings, along with the mixed findings regarding individuals' reactions to self-appraisals, the question is raised as to under what conditions might self-ratings be useful. Our study differs from previous investigations of self-ratings in that superiors in the organization we studied were given full control over whether or not subordinates performed a self-rating of their performance. All superiors had received training related to the performance appraisal process. Superiors were required to conduct an appraisal interview following their formal review and rating of subordinates' performance. …