The mediating role of the quality of performance appraisals on the association between the use of multidimensional performance measures and performance

This study aims to examine the impact of the use of multidimensional performance measures on the quality of performance appraisals (clarity, communication, fairness and trust) and the subsequent impact on employee job performance and organisational performance (financial and non-financial performance). Data were collected using an online survey questionnaire completed by a random sample of 203 lower-level managers in Australian organisations. The results reveal that the use of multidimensional performance measures exhibits a direct positive association with all four dimensions of the quality of performance appraisals and an indirect association with employee job performance (through trust), non-financial performance (through trust) and financial performance (through trust and clarity). The findings provide managers with an insight into the significant role of using multidimensional performance measures in enhancing the quality of performance appraisals and performance. In addition, the findings indicate that the impact of using multidimensional performance measures on employee job performance and organisational performance is enacted through the quality of performance appraisal, thereby highlighting the importance of the quality of performance appraisals, in particular clarity and trust, as a mediator of the association between the use of multidimensional performance measures and performance.