Self-Regulatory Effects of Performance Management System Consistency on Employee Engagement: A Moderated Mediation Model

Abstract

The study investigates the influence of performance management system consistency on employee work engagement. Drawing on the ‘job demands-resources model’ and ‘regulatory focus theory’, it was hypothesized that when employees perceive their performance management system to be consistent, they develop positive outcome expectations, which primes their achievement-oriented motivation (promotion regulatory focus) and increases their engagement. Responses were collected from 779 employees belonging to three large, multi-national organizations in India. Data were analyzed using PLS-SEM package ADANCO and Hayes’ PROCESS macro. Support was found for a moderated-mediation model. Specifically, promotion focus was found to mediate the relationship between performance management system consistency and work engagement, while positive affect moderated the relationship between performance management system consistency and promotion focus. The study advances scholarly understanding of the psychological impact of performance management systems on employees by clarifying the cognitive-affective processes underlying this relationship. The study also adds to the literature on work engagement by establishing consistency as a key attribute for performance management systems to act as a ‘job resource’ for employees and enhance their engagement. The study makes a strong case for organizations to look at performance management as an integrated system and move away from an insular focus on performance-related practices such as appraisals.