Performance Appraisal and Team Effectiveness: A Moderated Mediation Model of Employee Retention and Employee Satisfaction

Abstract

The changing business environment in the service sector requires service providers to adapt to the ongoing changes that incorporate more adaptability with a higher quality of service. Teamwork is an important aspect of working in the service sector as nowadays teamwork is seen as a fitting response to the changes in the business environment. Effective teamwork can help the service organizations to provide better quality service to its customers. The current study is an attempt to highlight the influence of performance appraisal (PA), employee satisfaction (ES) and employee retention (ER) on team effectiveness (TE) in the service sector. The analysis of the data was carried out using statistical tools, like the confirmatory factor analysis, and the structural equation modelling for elucidating the validity of the design. The results of the study show that PA and TE have a significant relation. ER acts as a partial mediator between PA and TE, and, on the other hand, ES acts as a moderator between PA and ER. The article provides key practical implications for the service sector in the state of Uttarakhand.