The Effects of Accountability On Favoritism in Subjective Performance Evaluations: An Eye-Tracking Study

This study uses an eye-tracking experiment to investigate the effects of accountability on favoritism in subjective performance evaluations. While prior work provides evidence that managers exert favoritism when subjectively evaluating the performance of preferred subordinates, less is known about how managers use their discretion and deal with performance information when exerting favoritism as well as possible control mechanisms firms may implement to mitigate its occurrence. We develop and test theory suggesting that the effectiveness of accountability to mitigate favoritism depends on managers’ cognitive processing of performance information. We argue that accountability will cause managers to examine performance information more thoroughly, which may entail having to scrutinize information which reflects unfavorable on a preferred subordinate. This causes cognitive dissonance and managers resolve this dissonance by engaging in motivated reasoning and cognitively discounting this information. The more managers reduce cognitive dissonance by discounting unfavorable information, the less is the favoritism-mitigating effect of accountability. Consistent with our prediction, we find that the more cognitive processing managers allocate to information that reflects unfavorable on a preferred subordinate, the lower the efficacy of accountability in mitigating favoritism. We contribute by enhancing our understanding of the effects of accountability in subjective performance evaluation.

In this study, I examine whether supervisors respond to their own preferences in subjective performance evaluation under a forced distribution system (FDS). Using a proprietary, archival dataset in a car dealership, I find that subjective evaluations are higher when longer supervisor-subordinate relationships exist, whereas subjective evaluations are lower when greater supervisor-subordinate age differences exist. The empirical evidence also indicates that subjective evaluations predict promotions and future performance of the employees, implying that the use of subjectivity allows supervisors to incorporate the forward-looking information of employee performance despite its potential biases. This study contributes to the literature by focusing on the performance appraisal based on the FDS and documenting the impact of supervisor incentives on subjective performance evaluation. Data Availability: Data used in this study cannot be made public due to a confidentiality agreement.

The moderating role of decision mode in subjective performance evaluation

In this paper, we investigate how subordinate likeability induces bias in managers’ subjective performance evaluations. Based on the affect-consistency heuristic, we expect managers who use multiple performance measures to subjectively evaluate their subordinates’ performance to place greater weight on likeability-consistent performance measures than on likeability-inconsistent measures. Hence, we predict that likeability and performance information interact in affecting managers’ performance evaluations. The results of our experiment support this prediction. In line with prior research, we find evidence of likeability bias in subjective performance evaluations: likeable subordinates receive more favorable evaluations than dislikeable ones. We further find that participants adjust their performance evaluations in the presence of likeability-consistent performance information to a greater extent than in the presence of likeability-inconsistent performance information. Thus, in accordance with the affect-consistency heuristic, our results indicate that likeability bias occurs due to a differential, biased weighting of performance measures. Additionally, we find that perceived likeability is also affected by subordinates’ performance, which in turn partially mediates the effect of subordinate performance on evaluations: good performers are more likeable than poor performers. Hence, this can exacerbate likeability bias. We discuss the implications of our findings for the design of performance evaluation systems in practice.

This study aims to investigate the relationship between the subjective performance evaluations on pilot trainees' aircraft control abilities and their brainwave dynamics reflected in the results from EEG microstate analysis. Specifically, we seek to identify correlations between distinct microstate patterns and each dimension included in the subjective flight control evaluations, shedding light on the neurophysiological mechanisms underlying aviation expertise and possible directions for future improvements in pilot training. Proficiency in aircraft control is crucial for aviation safety and modern aviation where pilots need to maneuver aircraft through an array of situations, ranging from routine takeoffs and landings to complex weather conditions and emergencies. However, the neurophysiological aspects of aviation expertise remain largely unexplored. This research bridges the gap by examining the relationship between pilot trainees' specific brainwave patterns and their subjective evaluations of flight control levels, offering insights into the cognitive underpinnings of pilot skill efficiency and development. EEG microstate analysis was employed to examine the brainwave dynamics of pilot trainees while they performed aircraft control tasks under a flight simulator-based pilot training process. Trainees' control performance was evaluated by experienced instructors across five dimensions and their EEG data were analyzed to investigate the associations between the parameters of specific microstates with successful aircraft control. The experimental results revealed significant associations between aircraft control levels and the parameters of distinct EEG microstates. Notably, these associations varied across control dimensions, highlighting the multifaceted nature of control proficiency. Noteworthy correlations included positive correlations between microstate class E and class G with aircraft control, emphasizing the role of attentional processes, perceptual integration, working memory, cognitive flexibility, decision-making, and executive control in aviation expertise. Conversely, negative correlations between microstate class C and class F with aircraft control indicated links between pilot trainees' cognitive control and their control performance on flight tasks. The findings underscore the multidimensional nature of aircraft control proficiency and emphasize the significance of attentional and cognitive processes in achieving aviation expertise. These neurophysiological markers offer a basis for designing targeted pilot training programs and interventions to enhance trainees' aircraft control skills.

Purpose This paper aims to analyze challenges of subjective performance evaluation (SPE) and their effects on team performance. It focuses on discretionary bonus allocations in teams and challenges driven by cognitive biases on the superior or the employee side. This is important as efficient teamwork is a relevant source of competitive advantages in firms, and firms often rely on teams to coordinate various, mutually supportive organizational activities. Design/methodology/approach The author analyzes results that have recently been discussed in the literature and link them to each other to create a more holistic picture about potential performance effects of SPE. Based on the analyses, the author develops avenues for future research and point out open questions. Findings Exploring employees’ fairness perceptions in team settings in which there is no clear standard for a “fair” team bonus allocation, the author finds that perceived fairness of team bonus allocation may decrease under SPE because employees interpret the “fairness” of the bonus allocation from an egocentric perspective. Such decrease in perceived fairness can eventually even lead to decreased team performance. Likewise, on the superior side, more complex, but highly relevant team can cause cognitive biases of superiors in assessing employee performance, thereby decreasing the potentially positive effects of SPE on team performance. Originality/value This paper contributes to the literature by analyzing recently discovered challenges of SPE in teams and linking them to each other to draw more general conclusions about the performance effects of SPE. For practice, my findings imply that firms may want to be cautious when evaluating the potential effects of SPE – as it is made by human beings with their cognitive biases. For research, the paper opens up new research possibilities and points out open questions.

Subjective evaluations of athletic performance are an important part of decision making across sporting organisations. Based on their expertise and intuition, coaches select their starting line-ups, scouts recommend or discourage teams from signing new potential players, and academy directors decide which players should move up or out of a team’s academy system. While this intuitive evaluation of performance occurs constantly throughout sport, little attention has been given to how this process can be more formally designed, implemented, and assessed to capture these expert evaluations of performance more effectively and thereby better inform decision making within sports organisations. In this opinion paper, the discrepancy between how often subjective evaluations are used in practice and how little research exists regarding their development, implementation, and effectiveness is examined. To assist in moving the sport science field forward, this paper will attempt to define subjective performance evaluations, describe the potential benefits that sporting organisations may get from using them, detail existing and potential uses for these measures, provide a framework for understanding how subjective data collection, and call upon the academic and applied sport community to drive the subjective evaluation field further.

We examine how subjective performance evaluations are influenced by the level and controllability of an accompanying measure of a separate performance dimension. In our experiment, supervisors evaluate the office administration performance of a hypothetical subordinate. We find that supervisors' subjective evaluations are directionally influenced by an accompanying objective measure of sales performance, even after excluding participants who perceive informativeness across measures. Consistent with concerns for fairness and motivation, we also find an asymmetric uncontrollability effect—supervisors' evaluations are higher when an uncontrollable factor decreases the subordinate's sales (i.e., they compensate for bad luck), but are not lower when the uncontrollable factor increases the subordinate's sales (i.e., they do not punish for good luck). This evidence suggests that supervisors use discretion provided to evaluate performance on one task to adjust for perceived deficiencies in the evaluation of performance on other tasks. Our study integrates theories of cognitive bias and motivation, highlighting the need to consider the potentially interactive effects of different performance measures in multi-task settings.

Organisations design performance evaluation systems to obtain desired work outcomes. This study analyses how subjective performance evaluation (SPE), a specific type of performance evaluation, is related to managerial work outcomes—turnover intention, organisational identification, and performance. To this end, we consider two possible mechanisms: feedback quality and trust in the supervisor. Moreover, we also consider whether adding objective performance measures to SPE alters these relationships. Based on questionnaire responses from 751 top executives and middle managers in small and medium enterprises, we find that SPE is negatively related to feedback quality, but this effect is mitigated when SPE is used jointly with objective performance measures. SPE is not directly related to trust in the supervisor when feedback quality is also considered in the analysis because the two mechanisms are inter-related—we find a positive relationship between feedback quality and trust in the supervisor. Both mechanisms are negatively related to turnover intention, but only trust in the supervisor is positively related to organisational identification. Finally, both turnover intention and organisational identification are positively related to performance. Our findings suggest that companies using SPE can improve work outcomes by adding objective performance measures to their performance evaluation system.

Subjective performance evaluation (SPE) in executive compensation raises concerns among investors due to a potential lack of pay-for-performance. However, while these concerns are reasonable, subjective performance evaluation can also supplement the incompleteness of objective performance measures and thereby improve incentive contracting. Based on this reasoning, we believe that SPE is essential for the progress of digital innovation where conventional performance measures typically fail to provide accurate information. Our results empirically verify that the adoption of SPE indeed encourages executives to engage in digital innovation. Moreover, we find that this positive association depends on CEOs' perception of director's ability and willingness to deviate from objective results when making subjective evaluations. Thus, our results are valuable for investors, firms, and compensation consultants thinking about SPE and struggling with digital innovation.

This study compared the effects of three treatments (two antihistamines and one placebo) on cognitive information processing, mood, subjective feelings of drowsiness, and subjective performance ratings in 28 healthy men. Evaluations were given at 1, 3, 5, 7, 9, 11, 13, and 15 hours post ingestion. Results revealed performance decrements post diphenhydramine (benadryl) ingestion on three tasks. No decrements in performance were found post ingestion of hismanal. Subjective effects of mood were noted for both antihistamines; however, these effects were greater post benadryl. Subjects were able to determine receipt of a placebo versus an antihistamine following ingestion of either a placebo or benadryl. Results suggest that hismanal is superior to benadryl for avoidance of subjective effects and performance of information processing tasks.

I study the implications of economic shocks for objective and subjective CEO performance evaluation. I explore objective CEO performance evaluation using the sensitivity of CEO cash pay to earnings. To set this sensitivity, pay-setting parties draw on information about earnings, which is perturbed when a shock occurs: after the shock, pay-setting parties lack information about earnings and need to estimate post-shock earnings, which introduces estimation risk into earnings-based CEO cash pay. To mitigate the impact of estimation risk on risk-averse CEOs, pay-setting parties reduce the sensitivity of CEO cash pay to earnings immediately after a shock. Over time, pay-setting parties learn about post-shock earnings, and estimation risk declines; I predict that, as a result, the sensitivity of CEO cash pay to post-shock earnings rises. Using U.S. executive pay data between 1992 and 2013, I find support for this prediction and document that the sensitivity of CEO cash pay to earnings increases progressively after a shock occurs. I next explore subjective CEO performance evaluation using handcollected data from U.S. proxy statements. I document that firms rely more extensively on subjective performance evaluation for setting CEO cash pay right after a shock occurs. My results suggest that objective CEO performance evaluation is deemphasized right after a shock in favor of subjective CEO performance evaluation, only to be used more intensely again as time passes since the shock occurred.

Player evaluation plays a fundamental role in the decision-making processes of professional sporting organisations. In the Australian Football League, both subjective and objective evaluations of player match performance are commonplace. This study aimed to identify the extent to which performance indicators can explain subjective ratings of player performance. A secondary aim was to compare subjective and objective ratings of player performance. Inside Football Player Ratings (IFPR) and Australian Football League Player Ratings were collected as subjective and objective evaluations of player performance, respectively, for each player during all 1026 matches throughout the 2013–2017 Australian Football League seasons. Nine common player performance indicators, player role classification, player age and match outcomes were also collected. Standardised linear mixed model and recursive partitioning and regression tree models were undertaken across the whole dataset, as well as separately for each of the seven player roles. The mixed model analysis produced a model associating the performance indicators with IFPR at a root mean square error of 0.98. Random effects accounting for differences between seasons and players ranged by 0.09 and 1.73 IFPR each across the five seasons and 1052 players, respectively. The recursive partitioning and regression tree model explained IFPR exactly in 35.8% of instances, and to within 1.0 IFPR point in 81.0% of instances. When analysed separately by player role, exact explanation varied from 25.2% to 41.7%, and within 1.0 IFPR point from 70.3% to 88.6%. Overall, kicks and handballs were most associated with the IFPR. This study highlights that a select few features account for a majority of the variance when explaining subjective ratings of player performance, and that these vary by player role. Australian Football League organisations should utilise both subjective and objective assessments of performance to gain a better understanding of the differences associated with subjective performance assessment.

We investigate the influence of peer quality on subjective performance evaluation using 75,413 ratings of 130 employees from 6,908 raters in a business school setting. We find that subjective performance ratings are lower for employees with higher quality peer groups in both randomized and nonrandomized settings. Using a novel long‐window setting, we observe peer effects persisting, but slowly decaying, for several months even when priming raters with the employees' previous performance information. We find that the strength of the peer effects is greater for focal employees with weaker performance, for the peers with higher attribute similarity, and when the performance of peers is more extreme. Overall, we find strong and persistent peer effects in subjective performance evaluation.

An important issue in human resources is the procedure of the employees’ performance evaluation. The appraisal is essential in the sense of employee appreciation and motivation. Most employers use a subjective performance evaluation of a single superior or a group of persons involved in the employee’s working processes. The subjective evaluation of a group or one person is often questioned about being appropriate. An often-named solution for a more objective criteria could be data driven performance measures. Professional sport provides a unique opportunity to compare objective and subjective performance evaluation measures. A data set of the German Bundesliga was used to test if the two different performance measure come to equal results. It is shown that differences in means exist but equivalence tests support the hypothesis that both measures could be treated as equal. In toto, it seems that in an environment where performance is relatively good to measure objective and subjective performance evaluations lead to equivalent results.