The Power of Words: Employee Responses to Numerical Versus Narrative Performance Feedback

Abstract

Should organizations embrace the recent trend of eliminating numerical ratings from their performance appraisals? In four experiments, we compared responses to performance feedback delivered in one of three formats: numerical-only, narrative-only, or a combination of both. Our findings suggest that narrative-only feedback was generally perceived as the fairest, likely because the evaluatees felt less negatively evaluated by it. However, narrative feedback was no longer perceived as fairer than the other two formats when the feedback was extremely positive or when recipients were informed about associated monetary outcomes. Furthermore, our findings indicated that feedback containing a narrative component not only gave recipients a clearer understanding of how to enhance their future performance but also often increased their motivation to do so. In interviews with human resource management professionals, we gained insights into the benefits of narrative feedback and understood why companies might be reluctant to eliminate numerical evaluations completely. Simple differences in performance feedback format can have a significant impact on employees' perceptions of fairness and their likelihood of improving performance based on the feedback. These insights are crucial for organizations to consider when designing their performance appraisal practices.