The Effect of Non-financial Performance Measures on Role Clarity and Procedural Fairness

The Role of Knowledge of Performance Appraisal Systems

DOI

10.2991/978-94-6463-026-8_24How to use a DOI?

Keywords

Non-financial performance measures; Knowledge of performance appraisal systems; Role clarity; Procedural fairness

Abstract

Due to the lack of efficiencies of traditional performance measures that focus on financial performance, organizations emphasize non-financial performance measures. There is a growing discussion on the advantages and consequences of non-financial performance measures usages, such as employees’ behavior. To be accepted by employees, the performance measurement systems need to be perceived as clear and fair. This study aims to investigate the effect of non-financial performance measures on role clarity and procedural fairness. In addition, this study also examines whether the knowledge of performance appraisal systems mediates the relationships. The data were collected through survey questionnaires from 79 employees at the managerial level of service organizations, specifically public accounting firms and a state-owned administrative service located in Jakarta, Bogor, Depok, Tangerang, and Bekasi. PLS-SEM with SmartPLS Software Version 3.3.3 was used to analyze the data. The results indicate that non-financial performance measures significantly affected role clarity and knowledge of performance appraisal systems. While there are no relationships between (1) non-financial performance measures and procedural fairness and (2) knowledge of performance appraisal system and procedural fairness, there are significant associations between (1) knowledge of performance appraisal systems and role clarity and (2) role clarity and procedural fairness. These results suggest that non-financial performance measures improve employees’ perceptions of role clarity and procedural fairness through a better knowledge of performance appraisal systems.

Copyright

© 2023 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Utami Puji Lestari
AU  - Yusep Friya Purwa Setya
AU  - Lanita Winata
PY  - 2022
DA  - 2022/12/10
TI  - The Effect of Non-financial Performance Measures on Role Clarity and Procedural Fairness
BT  - Proceedings of the 3rd Annual Management, Business and Economics Conference (AMBEC 2021)
PB  - Atlantis Press
SP  - 212
EP  - 218
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-026-8_24
DO  - 10.2991/978-94-6463-026-8_24
ID  - Lestari2022
ER  -