This presentation is about the impact of perceived fairness on the motivation of employees. There are two variables that I took to prove the hypothesis via a survey that grabbed data from about 100 respondents.

1. XLRI Jamshedpur

2. Introduction
PMS (Performance Management System): Consists of aspects such as goal
setting, communication of the goals, periodic feedback, competency
development etc.
Performance Appraisal System (PAS), a subset of PMS, is considered one of
the most important aspects of PMS. Hence, we have focused on PAS.
PAS: Typically the employee- engagement meeting.

3. Research & Hypothesis
Our research focuses on one of the important aspects of PAS:
perceived fairness of this system. Fair PAS is expected to
happen when the employees’ ratings are commensurate with
what they truly deserve.
Hypothesis: Perceived fairness in PAS leads to motivation of
employees.

4. Methodology
Data collected by a survey questionnaire and was filled by
PGDM (GM) batch of 2014-15 & ex-colleagues of the team
members across organizations. A total of 99 respondents filled
our survey.
Perceived fairness of PAS was measured using questionnaire
on a five-point scale ranging from 1 (very unfairly) to 5 (very
fairly).
Motivation was measured using set of 18 questions, using a
scale ranging from 1 (does not correspond at all) to 7
(corresponds exactly).

5. Findings & Discussions
As expected, we found a positive correlation between
perceived fairness and “external regulation, identified
regulation and integrated regulation”
As expected, we found no correlation between the
perceived fairness and “amotivation and intrinsic
motivation “
Correlation between perceived fairness and introjected
regulated form of extrinsic motivation was negligible.

6. Findings & Discussions continued....

7. Findings & Discussions continued....

8. Strengths & Limitations
Strengths :
Questionnaire- High citations- Fairness- 213, motivation- 79.
We have explored 5 different kinds of motivation: intrinsic motivation, integrated regulation,
identified regulation, external regulation and introjected regulation.
We surveyed employees from TCS, Siemens, Steria, Ericsson, Schenider and Oracle.
The respondents of the survey have had an average of at least 5 years of work experience.
Therefore, their responses would not be affected by a single PAS.
This research is applicable to almost all the industries globally.
Limitations :
The questionnaires for perceived fairness and motivation have different scales. Due to this, it
was challenging to jumble the questions across input and output variables.
Because of different scales, the regression analysis could not be carried out on the sample
data.

9. Future Scope
The research has focussed procedural justice. The impact of distributive
justice and interactional justice on employee motivation could be explored
This research only focuses on PAS as it the most important aspect of PMS.
However, employee motivation could be a function not only of the PAS but
the entire PMS. Further research could take a deep-dive into these
parameters in order to ascertain the relationship between these variables.
The causality between perceived fairness of PAS and motivation can be
better tested by conducting the survey twice: Sometime (4 weeks) before
the PAS and say (4 weeks) after PAS.

10. Conclusion
The study clearly shows that the perceived fairness of the PAS by the employee
has a positive effect on his/her Identified Regulation and External Regulation type
of extrinsic motivations.
The most influenced motivation with the fairness of the PAS is the Identified
regulation motivation - personal importance and conscious valuing.
Results also conclude that other very strong significant extrinsic motivation is the
External Regulation- any rules, regulations or orders.
Amotivation & intrinsic motivation have a negligible correlation with fairness of
PAS.
In summary, perceived fairness of PAS is positively correlated with employee
motivation.