Impact of functional interdependency on employee satisfaction with performance appraisal in the real estate industry

Elangovan N.,Sridhar Rajendran

doi:10.21511/ppm.18(4).2020.19

Elangovan N., Sridhar Rajendran

Open Access

https://doi.org/10.21511/ppm.18(4).2020.19

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Abstract

Unbiased performance appraisal tends to bolster the performance of employees. The studies indicate several inadequacies with the current performance appraisal systems. Functional interdependence is one such factor that has been ignored. The study aims to find the factors that can improve the satisfaction with performance appraisal of employees whose deliverables are highly interdependent on other functions. Organizational justice, rater competence, inter-functional conflict, and cohesion are considered the mediating variables. To test the model, the data are collected through a survey using a questionnaire from the executives of Indian real estate companies who have undergone the appraisal process at least once. Firms with more than 500 employees are randomly selected for the list of members of the real estate developers’ associations. The results show that functional interdependency has a negative impact on satisfaction with performance appraisal. Although conflict and cohesion are found to influence satisfaction with performance appraisal, they did not mediate the effect of functional interdependency on satisfaction with performance appraisal. However, the study found that rater competence and organizational justice have a mediating effect. The study provides practical implications to HR managers of real estate companies to train the raters and include the complexities of functional interdependencies in the appraisal system. A grievance mechanism should be created to address the employees’ concerns, ultimately improving satisfaction with performance appraisal.

Highlights

There are practical challenges posed by the appraisal process, leaving managers and employees frustrated and dissatisfied
The results show that functional interdependency has a negative impact on satisfaction with performance appraisal
The current study investigates the factors that can intervene with the performance appraisal process in an interdependent process and increase employee satisfaction

Summary

INTRODUCTION

There are practical challenges posed by the appraisal process, leaving managers and employees frustrated and dissatisfied. The researcher’s problem is to find out the factors that can improve employee satisfaction with performance appraisal in an interdependent environment This requires research on various HR aspects of the real estate sector. 2) Do appraisal-related factors such as rater competence and organizational justice affect the satisfaction with performance appraisal among employees who depend more on others’ performance?. 1. LITERATURE REVIEW, RESEARCH MODEL AND HYPOTHESES between organizational justice, rater competence, inter-functional cohesion, and conflict with satisfaction with performance appraisal in the inter-functional interdependence situations. De Dreu and Van Vianen (2001) found that A critical review of the literature reveals the impact “when there is an avoidant conflict management of functional interdependencies on the satisfaction culture, this increases the levels of both teams with performance appraisal in the real estate indusfunctioning and team effectiveness”.

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