‘Perceptions of Performance Appraisal Quality’ and Employee Innovative Behavior: Do Psychological Empowerment and ‘Perceptions of HRM System Strength’ Matter?

Organizations need to be innovative for their long-term survival and this can be achieved when their employees demonstrate innovative behaviors at the workplace. Innovative behavior has thus received considerable attention from researchers, particularly on exploring the factors which foster employee innovative behaviors. Based on human resource system strength theory, the objective of this study is twofold. First, it examines the direct and indirect relationship between perceptions of performance appraisal quality (PPAQ) and innovative behavior mediated through psychological empowerment. Second, it examines the moderating effect of perceptions of HRM system strength in the hypothesized links. A total of 360 faculty members participated in the study from twelve public sector higher education institutes in Islamabad, Pakistan. Partial least squares structural equation modeling (PLS-SEM) is used for statistical analysis of the quantitative data collected through self-administered questionnaire. Results demonstrated that PPAQ is positively related with innovative behavior. The findings also support the mediating role of psychological empowerment and the moderating role of perceptions of human resource management (HRM) system strength. We contribute to the literature by demonstrating that HRM content and process are two complementary facets of an HRM system in bringing out positive work behaviors. A number of practical implications and directions for future research are outlined.