The effects of directive practices in performance management systems on employees' subjective well‐being

Abstract While performance management systems are ubiquitous in organisations, their impact on employees' subjective well‐being remains highly contested in management research. This paper examines how directive practices in performance management systems influence employees' subjective well‐being by using self‐determination theory as a theoretical framework for our analysis and in particular the three needs for autonomy, competence and relatedness. Using data from 65 semi‐structured interviews with academics from schools of business and management in universities in the United Kingdom, we identified four subjective well‐being themes: feelings of inadequacy, resigned compliance, cognitive dissonance and self‐inflicted pressure. The findings indicate that directive practices in performance management systems generally thwarted the satisfaction of academics' needs for autonomy, competence and relatedness, which is negative for their subjective well‐being based on self‐determination theory. However, on occasion, directive practices in performance management systems helped academics to partially fulfil the needs for competence and relatedness when academics were able to meet their performance targets. We contribute to the literature by drawing on self‐determination theory to provide a novel analysis of the underexplored area of the effects of directive practices in performance management systems on employees' subjective well‐being.