Examining the relationship between behaviors and outcomes: An investigation of the impact of behavior-based feedback and development action planning on individual outcome measures

Performance appraisal is often considered the most important human resource application as organizations use it as a foundation for individual development and performance improvement. Two important considerations in the overall effectiveness of the performance appraisal process are: (1) the performance criteria---the standard against which successful or unsuccessful performance is determined, and (2) the method of evaluation. Organizations most commonly define performance in one of two ways---outcomes or behaviors, although it is becoming increasingly more common for organizations to define performance behaviorally. That said, behaviors can be measured objectively or subjectively. Due to the effort required and cost associated with objectively measuring behaviors, the most frequently used measures are subjective via ratings. Underlying these trends are three critical assumptions organizations make: (1) the behaviors chosen to define performance underlie individual outcome measures; (2) the subjective assessment via ratings of behaviors will be accurate; and (3) when an individual receives accurate feedback on specific, job-relevant behaviors and takes action to change those behaviors, this will result in improved individual performance.;The present field study sought to examine these three assumptions statistically and experimentally utilizing a quasi-experimental interrupted time-series design in a large financial services organization. First, the performance evaluation process was systematically designed to include multiple raters assessing 101 bankers on behavioral performance criteria. Following the receipt of feedback via an individualized report and one-on-one coaching session to assist in the interpretation of the feedback, a sample of the participants created development action plans designed to improve performance in specific behaviors.;Rating accuracy was assessed through the extent to which the behavioral ratings exhibited construct validity. Results of confirmatory factor analyses were inconclusive regarding the level of factor form and measurement equivalence. Results of predictive bivariate correlation analyses resulted in significant positive relationships between behavioral ratings and performance on two objective financial outcome measures. However, only a small subset of those behaviors maintained significance when controlling for pre-assessment financials in a partial correlation analysis, thus providing partial support for the hypothesis that behaviors underlie outcomes. Contrary to expectations, results of a repeated measures analysis of covariance (ANCOVA) revealed that development planning did not have a significant impact on performance improvement for the two outcome measures.;The present study represents the first systematic attempt to determine the impact behavior-based feedback coupled with development planning has on improvements in objective outcome measures in a field setting. Despite the fact that the results were inconclusive, they nevertheless raise significant implications for organizational practice and future research in performance management.