Performance appraisal as an antecedent to innovation: An analysis of its importance relative to other human resource practices

Abstract

Orientation: Innovation is essential to organisational survival, and several studies have shown that performance appraisals (PAs) contribute to innovation. Research purpose: The purpose of this study was to examine the importance of PA as an antecedent to innovation relative to other human resource practices (HRPs). Motivation for the study: The specific HRP drivers of innovation among employees and across organisations are not well specified, hindering appropriate resource allocation. Research approach/design and method: The PA-innovation link was investigated among 3180 employees across 53 South African organisations, utilising a cross-sectional survey design involving quantitative data, and focusing on correlation and regression analyses. Main findings: Human resource practices accounted for approximately 10% of the variance in innovation when considering individual employees. Performance appraisal was neither a common nor a unique predictor of innovation. When focusing on the link across organisations, a significant HRPs-innovation link was established in approximately 60% of organisations, with PA playing a significant role as the predictor of innovation in 10 (out of 53) organisations. Practical/managerial implications: Other HRPs, specifically supervisor support and staffing, played a much bigger role than PA in driving innovation of individuals, also across organisations. This specifies the relative importance of PA amongst other HRPs. Contribution/value-add: General managers, human resource practitioners and researchers can now use data-driven evidence to select specific HRPs which significantly enhance innovation among employees and across organisations.