The Impact of Performance Management Systems on Employee Wellbeing and Performance (WITHDRAWN)

Human Resource Management (hereafter: HRM) systems, such as performance management systems, are often assumed to contribute to employees’ performance by increasing their wellbeing first. Although intuitively appealing, research shows that employee wellbeing and performance are not always congruent outcomes of performance management systems. Adopting a system strength approach, we hypothesize that strong performance management systems lead to mutual gains in terms of psychological wellbeing (e.g., affective organizational commitment) and performance, but can result in conflicting outcomes for physical wellbeing (e.g., exhaustion) and performance. These hypotheses were tested on a sample of 459 teachers and 81 headmasters, working in Flemish education. Structural equation modelling supported the hypotheses. Strong performance management systems increased both employee wellbeing and performance. While psychological wellbeing mediated the relationship between performance management systems and performance, employees’ physical wellbeing and performance were rather independent outcomes. This study contributes to a better understanding of what effective performance management systems are, how they can be implemented as such, and how they can result in both wellbeing and increased employee performance.