참여적 목표설정이 성과평가지표 탈락에 미치는 영향

This study investigates how the ratee’s participation in the target setting process affects performance measure drop. In general, we evaluate performance by comparing actual performance to target in quantitative performance measures. It is very interesting research topic to examine whether the level of ratee’s participation in target setting process affects the performance measure selection because it is different by target setting method of performance measure. According to the prior literature, it is known that participative target setting provides the ratees the perception of procedural fairness in the evaluation process, thereby motivating them to work hard. In the other side, there is also an incentive for ratees to utilize private information to make budgetary slack in participative target setting process when there is information asymmetry between rater and ratee. Thus, I expect that designers of a performance evaluation system will consider countervailing two incentives when he decides to drop performance measure. Using performance evaluation results of Korean public companies from 1985 to 2011, I investigate how participative target setting affect performance measure drop. As a result, I find that participative target setting does not significantly affect the performance measure drop. However, I find that the common measure is relatively less likely to be dropped compared to the unique measure because common measure is more informative than unique measure due to relative performance evaluation. These findings suggest that participative target setting influences performance measure drop differently depending on the performance measure characteristics like common versus unique measure. This study contributes to expand research stream in performance measure choice.