Journal of Management Development

Performance appraisals: usage, criteria and observations

Linda S. Pettijohn R. Stephen Parker Charles E. Pettijohn ohn L. Kent
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Linda S. Pettijohn R. Stephen Parker Charles E. Pettijohn ohn L. Kent, (2001),"Performance appraisals:
usage, criteria and observations", Journal of Management Development, Vol. 20 Iss 9 pp. 754 - 771
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Danielle S. Wiese, M. Ronald Buckley, (1998),"The evolution of the performance appraisal process", Journal
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Journal of
Management Performance appraisals: usage,
Development
20,9
criteria and observations
Linda S. Pettijohn, R. Stephen Parker, Charles E. Pettijohn
754 and John L. Kent
Southwest Missouri State University, Springfield, Missouri, USA
Keywords Performance appraisal, Job evaluation, Sales management
Abstract Performance appraisals are often described as the ``job managers love to hate''. A
study was designed to provide sales managers with information designed to increase the benefits
of engaging in the evaluation process and reduce the negative sentiments often associated with
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appraisals. To accomplish this objective, 214 salespeople were personally interviewed and asked to
provide information regarding their perceptions of their performance appraisals. The results
indicate that salespeople have positive perceptions regarding the appraisal process. Findings also
indicate that while salespeople are often evaluated at least twice annually, the criteria used are not
always the ones that salespeople view as being the most appropriate. The conclusions derived from
the analysis may provide insight to sales managers as they attempt to develop and implement
appraisal processes that are viewed as being valid and as they attempt to enhance the benefits that
may be obtained from engaging in this process.
Of all the sales management activities discussed by both practitioners and
researchers, the performance appraisal seems to be regarded with the greatest
amount of ambiguity. On the one hand, it seems that almost all sales
management textbooks devote considerable space to discussions of the
performance evaluation process and managers seem to agree that it is a
necessary and critical task (Mohrman et al., 1989). But, on the other hand, it
seems that managers often trivialize the process, fail to use it to its greatest
potential, or avoid it entirely (Markowich, 1994; Morris et al., 1991; Thomas and
Bretz, 1994; Wanguri, 1995). Perhaps the contradiction between theory and
practice may be attributed to a recognition that while properly conducted
performance appraisals might yield considerable dividends, in practice,
managers may feel ill-equipped to conduct effective appraisals. Sales managers
may have unresolved issues concerning the frequency with which appraisals
should be conducted or the criteria that should be used in the appraisal process.
Numerous researchers (Bush et al., 1990; DeCarlo and Leigh, 1996; Smither,
1998; Thomas and Bretz, 1994) argue that these unresolved issues may be
partially attributed to a paucity of empirical research as it is related to the
appraisal process, especially in a personal selling context.
A variety of factors may exist that could rationally explain the reluctance of
sales managers to fully implement a procedure that has been described as
being one of the most important and beneficial activities at their disposal. Such
a reluctance may be attributed to various uncertainties regarding several
aspects of the evaluation process. Such aspects may include, but are not limited
Journal of Management Development,
Vol. 20 No. 9, 2001, pp. 754-771.
to, issues such as the criteria used in the evaluation, the frequency with which
# MCB University Press, 0262-1711 the evaluations should be conducted, and whether the criteria used in
 performance evaluations are in essence universal or customized to specific Performance
sales situations. Finally, with regard to the criteria selected, if sales managers appraisals
believe that a customized appraisal is appropriate, they may also wonder
whether the criteria being used are the ones ``most appropriate'' for their
situations. Based on these premises, the purpose of this research is to examine
``the state of the art'' as it relates to performance appraisals. Specifically, the
study will evaluate the criteria used in the appraisal process, the frequency 755
with which appraisals are conducted, salesperson opinions regarding the
``proper'' criteria that should be used in those evaluations, and differences in
criteria usage by different sales positions. These results can then provide
direction to sales managers in their efforts to both design and conduct
performance appraisals. This direction may then result in a more enthusiastic
and diligent process of conducting appraisals, because sales managers could
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have greater insight into the methods and criteria that can be most effective.
The findings could also provide direction to academicians as they evaluate the
relationships between appraisals, appraisal criteria, antecedents of the
appraisal process, and various possible consequences of the appraisal process
(i.e. turnover, performance, satisfaction, commitment, etc.).

Review of the literature

The literature review will focus on three primary areas. The review will first
examine studies which discuss the purposes of and the benefits that may be
received from conducting performance appraisals. Second, research will be
examined to identify the criteria that are typically used in the evaluation
process and the rationale supporting the use of alternative criteria. Finally, the
literature review focuses on research discussing salient characteristics of the
appraisal process.

Purposes and benefits of appraisals

The significance of the performance appraisal has been documented by
numerous authors. For example, Larson (1984) states that feedback about
performance is an ``integral'' component of any organizational control system.
This position is supported by other authors (DeCarlo and Leigh, 1996; Morris
et al., 1991) who contend that performance appraisals may be one of the sales
manager's most important job responsibilities.
Perhaps the predominant appeal of the performance appraisal is based on
the widely held position that performance appraisals can provide numerous
organizational benefits. First, performance appraisals are often credited with
increases in salesperson effort, motivation and performance (Churchill et al.,
1985; Hackman and Oldham, 1975; Mohrman et al., 1989; Mount, 1983; Mowen
et al., 1985; Patton and King, 1985). Correspondingly, many of the benefits of
performance appraisals accrue as a result of the appraisal's impact on reducing
salesperson role ambiguity. In general, research has shown that performance
appraisals reduce role ambiguity (Brown and Peterson, 1993; Dubinsky and
Mattson, 1979; Jaworski et al., 1993) and these reductions in role ambiguity are
 Journal of commonly associated with increases in effort, performance, satisfaction,
Management commitment, and a decrease in turnover (Babakus et al., 1996; Behrman and
Development Perreault, 1984; Brown and Peterson, 1994; Cotton and Tuttle, 1986; Dubinsky
and Mattson, 1979; Jaworski et al., 1993; Jones et al., 1996; Michaels et al., 1988).
20,9 In addition to the described relationship between performance appraisals
and various behavioral outcomes, performance appraisals are frequently used
756 to determine employee compensation, merit pay (Anderson and Oliver, 1987;
Dubinsky et al., 1989; Murphy and Cleveland, 1995; Thomas and Bretz, 1994)
and other organizations' rewards (e.g. promotions) (Markowich, 1994; Murphy
and Cleveland, 1995; Thomas and Bretz, 1994). Performance appraisals
facilitate other human resource management functions. For example, the
performance appraisal can provide information regarding the effectiveness of
the firm's selection and placement programs (Dubinsky et al., 1989; Thomas
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and Bretz, 1994), and may help identify and evaluate needs in the area of
human resource training and development (Dubinsky et al., 1989; Thomas and
Bretz, 1994).
While performance appraisals may satisfy numerous organizational
objectives, their overriding purpose is often identified as providing information
and direction to employees in a manner which will lead to improved
performance (Latham et al., 1993). The concept that the focal point of the
evaluation process should be on performance improvement is supported by
Boles et al. (1995, p. 31) who state, ``The expenses associated with fielding a
sales force emphasize the importance of accurately assessing salesperson
performance to ensure that the sales force makes a positive contribution to the
firm's long-term survival and profitability''. The numerous benefits and uses of
performance appraisals support the conclusion of Morris et al. (1991, p. 25) who
state ``. . .performance appraisals have become one of the sales manager's most
critical responsibilities''.

Criteria used in the appraisal process

The criteria used in assessing performance are typically regarded as being
critical because they provide the foundation for a manager's evaluation of a
salesperson and thus may influence the degree to which the manager's
evaluation is accepted (DeCarlo and Leigh, 1996). While the criteria used in
evaluations may be perceived as being important, it has been noted that ``little
is known about the bases actually used to evaluate salespeople'' (Jackson et al.,
1995). Thus, there seems to be little agreement regarding the evaluation
variables that will provide the maximum benefits to the evaluation efforts.
Researchers have often divided evaluative criteria into two categories.
These two categories are frequently given different labels (e.g. qualitative/
quantitative, behavior/output, subjective/objective), but they are most often
labeled input and output criteria (Oliver and Anderson, 1994, 1995; Challagalla
and Shervani, 1996; Jaworski and Kohli, 1991; Markowich, 1994; Oliver and
Anderson, 1995). Generally, the input criteria are described as including
personal qualities, activities and sales strategies (Oliver and Anderson, 1995).
 The output criteria are described as being related to the results obtained from Performance
the individual's job performance (e.g. sales volume, profits). appraisals
Jackson et al. (1995) provided a comprehensive analysis of the criteria used
in sales force performance evaluations. Their survey of 215 sales managers
indicated that the most used ``output'' criteria were related to sales volume
(i.e. sales volume in dollars (79 per cent); sales volume to previous year's sales
(76 per cent); sales volume by dollar quota (65 per cent); percentage increase in 757
sales volume (55 per cent); and sales volume by product line (48 per cent)).
Other popular output criteria were number of new accounts (69 per cent); net
profit (65 per cent); and market share (59 per cent). The most widely used input/
qualitative criteria included communication skills (88 per cent); product
knowledge (85 per cent); attitude (82 per cent); selling skills (79 per cent);
initiative and aggressiveness (76 per cent); appearance and manner (75 per
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cent); enthusiasm (66 per cent); knowledge of competition (63 per cent); time
management (63 per cent); motivation (61 per cent); ethical and moral behavior
(59 per cent); selling expense vs budget (55 per cent); total expenses (53 per
cent); selling expense to sales base (49 per cent); and number of customer calls
(48 per cent). These results reflected an earlier study of 104 sales managers who
found that sales volume measures and the various qualitative measures (i.e.
communication skills and attitude) were frequently used and that ``efficiency''
(e.g. input) measures such as cost per call or selling expenses were rarely used
(Morris et al., 1991).
The findings in many studies indicate that input/behavioral criteria are
preferred over output criteria (Challagalla and Shervani, 1996; Latham et al.,
1993; Oliver and Anderson, 1995; Pekarne and Von Arnold, 1991). The
preference for behavioral criteria is largely predicated on the belief that these
criteria are subject to a greater degree of self-control than are output criteria,
while the use of output criteria is either outside a salesperson's control or leads
to activities which are detrimental to the long-term profitability of the firm
(Churchill et al., 1985; Challagalla and Shervani, 1996; Oliver and Anderson,
1994).
However, some researchers argue that output criteria should be the preferred
criteria. The justification supporting output criteria vis-aÁ-vis input criteria is
largely based on the belief that the use of behavioral criteria results in ``less
than objective evaluations'' (Ilgen and Feldman, 1983; Latham et al., 1993;
Markowich, 1994).
Still other researchers concede that both criteria should play a significant
role in the evaluation process and that no single form of criteria is ``always''
preferred (Patton and King, 1985; Oliver and Anderson, 1995; Wanguri,
1995). Research has shown that while positive ``output'' feedback is the most
effective method of improving performance, positive behavioral feedback
tends to have the greatest impact on satisfaction (Jaworski and Kohli, 1991).
Correspondingly, other studies have found no differences in the levels of
performance that result from either behavior or outcome controls (Oliver and
Anderson, 1994).
 Journal of Salient characteristics of the appraisal process
Management The major substantive conclusion that appears in the literature with regard to
Development the criteria relates to the importance of salesperson input. As Brown and
Peterson (1994) state, ``managers should include evaluative criteria which are
20,9 important to the salesperson''. Salesperson involvement into the selection of the
criteria has been described as enhancing the salesperson's perception of the
758 fairness of the evaluation (Gilliland and Langdon, 1998; Latham et al., 1993).
Participation in the process has also been described as increasing salesperson
satisfaction; both the salesperson and sales manager have the opportunity to
exchange more information and therefore clarify more potential ambiguities
(Dobbins et al., 1990). Conversely, appraisals which evaluate salespeople using
criteria that are unknown to the salesperson may lower motivation (MacKenzie
et al., 1993). In fact, participation in the process has been described as making
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employees more receptive to negative feedback (Dipboye and de Pontbrian,

1981; Mohrman et al., 1998). Thus, if the employee and the manager have no
sense of ownership in the system, and have not been involved in the design of
the appraisal process, then both may approach the appraisal process with high
levels of disdain and low levels of commitment.

Research purposes and questions

The primary purpose of this research is to examine the ``state-of-the-art'' as it
pertains to the practice of performance appraisals from the perspective of the
salesperson. Of the research cited in the review of the literature, no study
assesses salespersons' perceptions and opinions of the performance appraisal
process. This seems enigmatic given that sales managers, the ones most
frequently used as respondents to studies of this type, provide answers based
on their frames of reference, and these frames of reference, while relevant and
important, should not be the only ones assessed. Managers may provide
responses based on what is socially acceptable or based on their perceptions of
the appraisal situation, specifically the appraisal criteria used. However, many
individuals may be able to recall situations in which the criteria stated by
management either was not the criteria actually used in the evaluation
procedure, or in which the criteria used were viewed as being inappropriate. A
consideration of salesperson perceptions of the criteria used in the appraisal
process may reduce some sources of bias and may add another dimension to
the level of understanding of sales force performance reviews. Perhaps more
importantly, if salespeople believe they are assessed by a specific criterion, then
it could be argued that it is that criterion which affects their behaviors. These
beliefs regarding criteria usage will then influence the degree to which the
appraisal is accepted, used, and ultimately benefits the organization and
the sales force. Thus, the thrust of this research entails an examination of
the appraisal process as it currently exists in numerous businesses. This
assessment will evaluate the frequency with which appraisals are conducted,
the criteria used in the appraisal process, and an evaluation of the salespersons'
perceptions of possible conflicts with regard to criteria usage.
 In addition, the research will examine the validity of some preliminary Performance
research questions which may be answered through the research. One such appraisals
question involves an examination of the relationships that might exist between
different types of sales positions and the performance appraisal process. For
example, one might generally anticipate that individuals occupying sales
positions in which their primary customer is the end-user (e.g. retail sales
positions) would be evaluated primarily through the use of input criteria. This 759
opinion may be held for a number of reasons. First, retail salespeople may also
be more subject to the whims of competition and the economy, and an
evaluation using output criteria may be unfair because the outputs obtained
might be beyond their control. Using this logic, Bush et al. (1990) point out that
performance appraisals that focus on salesperson behavior or activities seem
more appropriate at the retail level than at the industrial level. Thus, research
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question one states:

Q1. Are retail salespeople more likely to be subject to performance
appraisals based on input criteria than either industrial or wholesale
sales representatives? Using a similar logic, the corollary to this
question relates to the use of output criteria and states: are retail
salespeople less likely to be evaluated using output criteria than are
industrial or wholesale salespeople?
One could reasonably anticipate that in those circumstances in which a
manager's sales force is either relatively inexperienced or relatively
uneducated, a greater use of input criteria would be required. This perception is
based on the concept that the lower the levels of a salesperson's education/
experience, the greater assistance this salesperson will require to attain higher
levels of effectiveness. One type of assistance provided could be expected to be
in the form of the performance appraisal. Thus, question two will address
whether there is a different set of criteria that are used to evaluate less
experienced and educated salespeople? One could argue that input criteria
would seem more appropriate for salespeople with lower levels of experience
and education, since these criteria might be used to ``develop'' the less educated
individual. Consequently, research question two asks:
Q2. Are salespeople with lower levels of experience and education more
likely to be appraised using input criteria than are salespeople with
higher educational levels?
Anderson and Oliver (1987) argue, frequency of appraisals is greater when
input criteria are used. If research question one shows that retail salespeople
are more frequently evaluated by the use of input criteria, it would follow that
the frequency of their evaluations would be greater. This frequency could also
be expected to be increased to the degree that these salespeople can be
monitored more closely and provided greater degrees of direction than can
other salespeople. This argument essentially holds that since appraisals are
frequently developed with performance improvement as a goal, and since input
 Journal of criteria are recommended as the criteria which should be used to affect
Management improved performance, it seems logical to assume that retail sales
Development representatives would have their performance appraised more frequently than
would either wholesale or industrial salespeople. Therefore, question three
20,9 states:
Q3. Will the performance of retail salespeople be appraised more frequently
760 than the performance of wholesale or industrial salespeople?
It would also seem that managerial professionalism could lead to the use of
more developmental activities for their sales forces. Jaworski et al. (1993)
contend that larger firms tend to use more bureaucratic controls. This logic
would seem to lead to the proposition that firms that have adopted more
professional developmental activities (i.e. sales training) might be more likely
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to use other professional development tools, like performance appraisals. The

fourth research question states:
Q4. Will firms that engage in sales training be more likely to engage in
other developmental activities, such as performance appraisals?

Methodology
The purpose of the study was to assess the characteristics of performance
appraisals from the vantage point of the salesperson. Based on this purpose,
the methodology required the following steps:
(1) questionnaire development;
(2) sample selection;
(3) data collection; and
(4) analysis of the results.
With regard to the development of the questionnaire, the purpose of the
study required that ``generic'' characteristics of appraisals be identified. Thus,
questions were developed that related to the conducting of performance
appraisals, the frequency with which evaluations are conducted, the criteria
used in the appraisal process, and the salesperson's opinions of the criteria that
should be used in conducting performance appraisals. In the majority of cases,
questions were dichotomous, to facilitate ease of understanding and response.
To determine whether the questions were understood and related to the
research objectives, the questionnaire was pretested with a group of students
enrolled in a personal selling class and with ten professional salespeople. Based
on these pretests several questions were reworded and retested. It was then
determined that the questions were well-understood and were suitable to
accomplish the purposes of the research.
Obtaining a sample of salespeople was somewhat difficult, because the
research objectives dictated that a broad-based sample was desirable. This
type of sample was sought so that the results might reflect a general view of
performance appraisals overall, not a micro view generalizable to only one
 particular firm. Thus, a judgmental sampling method was employed in which Performance
full-time representatives who were engaged in creative selling activities were appraisals
identified as potential interview candidates. Potential respondents were
identified and screened for suitability by the authors. Respondents who met
these criteria were contacted and asked to participate in a research project. A
total of 250 potential subjects engaging in full-time personal selling activities
were identified and their participation solicited. These individuals were then 761
contacted by trained interviewers who obtained answers to the questions
through a personal interview process.

Results
A total of 250 potential subjects were identified and their responses solicited. A
total of 214 (86 per cent) agreed to participate in the study and provided usable
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questionnaires. As shown in Table I, the majority of the respondents were

male. More than one-half of the respondents were over 34 years old, earned in
excess of $37,500, and had at least an undergraduate college degree (63.3 per
cent).
Initially, salespeople were asked whether their performance had been
``formally'' appraised by their current employer. In the pre-tests the word
``formally'' was recommended by the respondents to separate what may be

Characteristic Per cent

Gender
Male 71.0
Female 29.0
Age (years)
21-34 46.8
35-50 42.7
51 and over 8.8
Income ($)
Less than 12,001 3.3
12,001-37,000 33.2
37,001-71,000 33.6
Over 71,000 20.6
Education
High school 17.0
Some college 17.4
College degree 55.5
Advanced degree 7.8
Sales position:
Retail 46.5
Wholesale 21.5
Table I.
Industrial 32.0
Characteristics of the
Note: n ˆ 214 respondents
 Journal of described as judgmental comments by their managers from actual performance
Management appraisals. In fact, when the word ``formally'' was added, pre-test subjects
Development stated that they perceived the appraisal as a specific and discrete event that
entailed a detailed conversation with their appraiser. The results provided
20,9 in Table II show that 81.3 per cent of the respondents stated that their
performance was ``formally'' appraised. These results are supported by
762 previous results, such as Dubinsky and Barry's (1982) findings which indicated
that large firms report the use of performance appraisals in 89 per cent of the
cases and smaller firms report the use of appraisals in 79 per cent of the
situations evaluated.
Next, respondents who had been formally appraised were asked for
information about the criteria that were used in their appraisals, and for their
opinion of the criteria that should be used in their appraisals. Criteria included
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in the questionnaire were derived from the criteria identified in previous

studies as being the ones most likely to be used in assessing performance
(Dubinsky and Barry, 1982; Jackson et al., 1995; Mowen et al., 1986). Using
previous studies as a model (Jackson et al., 1995), respondents were asked to
indicate which of the criteria had been used in their appraisals. However, in this
study, only those salespeople who indicated that they had received a ``formal''
appraisal of their performance while employed by their current employers were
asked to identify the criteria that were used in their appraisals, thus reducing
the number of respondents to 174 (70 per cent of the sample). Also consistent
with previous studies is the finding that sales volume is the most used
performance appraisal criterion (Dubinsky and Barry, 1982; Jackson et al., 1995;
Morris et al., 1991). Table II shows that the more popular appraisal criteria
(those whose use was reported by over 40 per cent of the respondents) included:
customer satisfaction, attainments of sales objectives, attitude, and initiative/
aggressiveness. The least used criteria (used by less than 20 per cent of the
respondents) were: number of calls, appearance, and report preparation.

Criteria Usage percent

Sales volume 60.3

Customer satisfaction 57.5
Attainment of sales objectives 51.7
Attitude 50.0
Initiative/aggressiveness 43.7
Product knowledge 39.7
Communication skills 39.7
Profitability of sales 39.1
New account sales 36.8
Number of calls 16.7
Appearance 13.2
Report preparation 11.5
Table II.
Appraisals conducted 79.6
Criteria used In the
appraisal process Note: n ˆ 174
 Previous studies did not address the issue of the relative perceived Performance
appropriateness of the criteria. One of the purposes of the current study is to appraisals
assess salesperson perceptions of the legitimacy of the criteria used in their
appraisals. The authors felt that if the subjects being appraised believed that a
particular appraisal criterion is either inappropriate for inclusion or has been
inappropriately omitted, those individuals may conclude that the validity of the
appraisal is lessened and the appraisal process itself may be rendered 763
incapable of yielding many of the its potential benefits. Thus, Table III
provides the results as they relate to the respondents' perceptions regarding
criteria that should be added or deleted from their present evaluations. As
shown in the table, the criterion most desired for addition to the appraisal was
``customer satisfaction'', with 31 per cent of the respondents recommending that
it be added to their evaluation criteria.
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Two of the criteria, ``attitude'' and ``initiative/aggressiveness'', generated a

mixture of responses. As indicated in Table III, 19.2 per cent of the respondents
recommend that these two criteria be added to their evaluations. However, 10.7
per cent of the salespeople stated that they would prefer that these two criteria
be deleted from their evaluations. Other criteria which the respondents
indicated that they would prefer be added to their evaluations include
``communication skills'' (20.8 per cent) and ``product knowledge'' (18.7 per cent).
In terms of deletion of criteria from their evaluations, the respondents
recommended that ``attainment of sales objectives'' (11.7 per cent) and ``new
account sales'' (10.3 per cent) be removed.
Research questions were also addressed. Most of the research questions
examined the validity of assumptions that had not been explicitly examined in
previous research regarding the use of alternative evaluation criteria and
various salesperson characteristics (i.e. type of job, experience, and education).
To assess the differences in the use of criteria based on salesperson
characteristics required that the criteria be grouped into input and output

Total change Add criteria Delete criteria

Criteria (%) (%) (%)

Customer satisfaction 35.5 30.8 4.7

Attitude 29.9 19.2 10.7
Initiative/aggressiveness 29.9 19.2 10.7
Communication skills 29.4 20.8 8.9
Product knowledge 28.0 18.7 9.3
Attainment of sales objectives 25.2 13.6 11.7
Profitability of sales 20.1 11.2 8.9
Sales volume 18.7 10.7 7.9
Appearance 18.2 12.6 5.6
New account sales 17.8 7.5 10.3
Number of calls 11.2 3.7 7.9
Table III.
Report preparation 7.0 1.9 5.0
Changes desired in
Note: n ˆ 174 appraisals
 Journal of criteria. This was accomplished by using the groupings of previous researchers
Management (Anderson and Oliver, 1987; Cravens et al., 1993; Morris et al., 1991; Oliver and
Development Anderson, 1994, 1995) and duplicating their efforts. Thus, criteria were
identified as either input or output criteria and the usage of the alternative
20,9 criteria were then totaled for each salesperson. The results of totaling the
relative usage of the criteria allowed for the identification of input and output
764 categories and ``high'' and ``low'' usage levels were developed for both input and
output groupings. Following the groupings into high/low, comparisons were
made using Chi-square analysis to delineate differences that may be attributed
to the characteristics of the salespeople.
Research question one is concerned with whether different appraisal criteria
are used for retail selling as compared with other types of selling (i.e. industrial
and wholesale). The logic underlying the question is based on the premise that
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retail sales roles are different from industrial and wholesale roles due to the fact
that retail salespeople work in close proximity to their managers, in a well-
defined and controlled environment. Furthermore, retail positions are more
likely to be staffed by sales personnel who have less sales experience than do
other categories of salespeople. Consequently, it would seem logical for sales
managers to monitor and appraise their retail salespeople's performance using
input criteria because these criteria are typically used in situations in which the
results obtained are beyond the salesperson's control. The results shown in
Table IV indicate that question one may be answered positively because there
does appear to be a difference in criteria usage that can be attributed to
differences in the salesperson's job. Retail sales personnel appear to be more
likely to have their performance appraised through the use of input criteria
than would either industrial or wholesale salespeople (2 ˆ 6:4; p < 0:04).
With regard to the use of output criteria, the results are not significant
(p < 0:10). However, it appears that retail salespeople are less likely to be
evaluated through the ``heavy'' use of output criteria than are either industrial
or wholesale salespeople.
Table IV also provides the results that relate to answers to Q2. According to
this question, experience and education may be related to the relative usage
of output or input appraisal criteria. The contention is that the lower the
salesperson's level of education/experience, the greater will be the emphasis on
the use of input controls. This assumption is based on the perception that lower
levels of education and experience will require managers to emphasize the
salesperson's inputs into the work. The emphasis on inputs could be attributed
to the fact that sales managers may believe that individuals with lower levels of
education and experience may require more assistance and direction and that
for these individuals, outputs may be beyond their control. To test the validity
of the research question, the sample was divided into three groups (low,
medium, and high) based on their relative levels of experience and two groups
(low and high) based on their educational levels. Chi-square analysis was again
used to assess the significance of differences between the groups in terms of the
use of the alternative criteria.
 Use of input or output Performance
criteria appraisals
Low High Total
n (%) n (%) n (%)

Type of customera
Retail 22 43 29 57 51 47
Wholesale 12 57 9 43 21 19
765
Industrial 26 70 11 30 37 34
Total 60 55 49 45 109 100
Chi-square = 6.4 (p < 0:04)
Type of customerb
Retail 31 65 17 35 48 45
Wholesale 11 48 12 52 23 22
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Industrial 16 44 20 56 36 34
Total 56 54 49 46 107 100
Chi-square = 3.8 (p < 0:15)
Level of experiencea
Less than 3 years 10 48 11 52 21 19
3 to 6 years 17 68 8 32 25 23
Over 6 years 33 52 30 48 63 41
Total 60 55 49 45 109 100
Chi-square = 2.8 (p < 0:31)
Level of experienceb
Less than 3 years 13 54 11 46 24 22
3 to 6 years 11 50 11 50 22 21
Over 6 years 34 56 27 44 61 41
Total 58 54 49 46 107 100
Chi-square = 0.2 (p < 0:90)
Level of educationa
Less than college degree 5 28 13 72 18 22
At least a college degree 41 63 24 37 65 78
Total 46 55 37 45 83 100
Chi-square = 7.1 (p < 0:01)
Level of educationb
Less than college degree 13 76 4 24 17 21 Table IV.
At least a college degree 33 52 31 48 64 79 The relationships
Total 46 57 35 43 81 100 between type of sales
Chi-square = 3.4 (p < 0:06) position and the use of
alternative appraisal
Notes: n ˆ 174; a Use of input criteria; b use of output criteria criteria

The results, as they pertain to experience, are inconclusive. As shown in

Table IV, no significant differences (p < 0:10) were found as they relate to
either the levels of output or input criteria and the amount of salesperson
experience. However, the results appear to be more conclusive for education. As
shown in Table IV, high levels of education lead to significantly (2 ˆ 3:4;
p < 0:06) higher levels of the use of output criteria than would be expected
and lower levels of education lead to lower levels of output criteria.
 Journal of Correspondingly, higher levels of education show a lower reliance on input
Management criteria than do lower levels of education. Thus, a significant difference
Development (2 ˆ 7:1; p < 0:008) exists in the use of input criteria and education.
Q3 addressed whether differences in appraisal frequency would be found
20,9 based on the type of sales position held (i.e. retail, wholesale, industrial).
Frequencies of appraisal were divided into three categories: high, medium, and
766 low relative frequencies of appraisal. As shown in Table V, the results show
that no significant differences (p < 0:10) exist in terms of appraisal frequency
and the type of position held.
The final research question Q4, examined, assessed the validity of the
assumption that firms which engage in one type of ``professional'' managerial
endeavor (e.g. sales training) would be more likely to engage in another
``professional'' managerial activity (e.g. performance appraisals). The results of
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the chi-square analysis show that firms that engage in sales training are
significantly (2 ˆ 15:6; p < 0:001) more likely to engage in performance
appraisal activities (see Table VI).

Managerial implications and conclusions

The primary purpose of the research was to provide sales managers with
insights into the current practice of performance appraisals by examining
numerous aspects of the appraisal process. One finding which may be of
interest to sales managers is that in spite of the generally cited negative
predispositions toward conducting performance appraisals, the findings
indicate that appraisals are conducted for the vast majority of salespeople. In
fact, almost 80 per cent of the participating salespeople had their performance

Type of customer
Retail Wholesale Industrial Total
Frequency of evaluation n (%) n (%) n (%) n (%)

At least quarterly 42 44 24 25 30 31 96 53
Quarterly to biannually 13 44 5 17 11 38 29 16
Biannually to annually 24 44 11 20 20 36 55 31
Table V.
Type of customer and Total 79 44 40 22 61 34 180 100
frequency of appraisals Chi-square = 1.2 (p < 0:87)

Sales training
Conducted Not conducted Total
Appraisals n (%) n (%) n (%)

Conducted 149 81 35 19 184 79

Not conducted 25 52 23 28 48 21
Table VI.
Training and Total
performance appraisals Chi-square = 17.0 (p < 0:0001) 174 75 58 25 232 100
 formally appraised in the previous year. This finding indicates that the Performance
conducting of performance appraisals is common in the sales profession. One appraisals
might conclude that this commonality may be attributed to the fact that both
sales managers and sales representatives perceive that formal performance
appraisals offer a variety of potential benefits to both parties. Conversely, the
commonality of appraisals might simply be attributed to the fact that these
appraisals are a management exercise which is mandated by organizational 767
policies and procedures. However, the frequency with which these appraisals
are conducted indicates that the appraisals may be more than a managerial
exercise. The results indicated that appraisals are commonly (69 per cent)
conducted at least twice annually. This may imply that the firms employing the
sales representatives participating in this study feel that the appraisal process
yields benefits that make the endeavor a worthy investment.
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The results also indicate that not all salespeople felt that they were being
evaluated by the ``ideal'' set of criteria. For example, one-fifth of the participants
would prefer that seven of 12 criteria be changed in terms of their emphasis.
This preference indicates that total satisfaction with the evaluative criteria
does not exist. The fact that salespeople recommend adding customer
satisfaction, communications skills, and product knowledge to the criteria list
suggests that salespeople might prefer to be evaluated by criteria which they
can control or influence. Additionally, these criteria may be perceived as
criteria which may positively affect their future success in sales. Thus, sales
representatives may logically be desirous of being appraised by criteria that
are within their control and by criteria that are positively related to their future
success. The criteria that salespeople indicated they would most prefer
removed from their appraisals were the attainment of sales objectives and new
account sales. These findings imply that salespeople may believe that these
two factors are outside their control and thus are not the criteria upon which
they should be evaluated. The mixed results regarding the two criteria, attitude
and initiative/aggressiveness, indicate that some salespeople perceive that
these two areas are within their control and that they lead to increased levels of
success. However, other salespeople expect that their managers are not capable
of accurately assessing their attitudes or their initiative/aggressiveness and
consequently recommend that these topics be deleted from their appraisals. It
seems clear that salespeople have strong sentiments regarding the propriety of
alternative criteria used in their appraisals. These sentiments may affect the
usefulness of the appraisal in terms of improving sales behaviors, performance,
morale, satisfaction, and turnover. Therefore, it may be concluded that sales
managers should obtain the salesperson's input into the criteria used in
evaluating their performance to ensure that salespeople have greater
agreement with the criteria used. Alternatively, it could be concluded that
managers should ``at least'' attempt to explain their justifications for the
inclusion of alternative criteria. Two positive outcomes may directly result
from these actions. First, salespeople may gain feelings of ownership in the
process. Accompanying these ``ownership sentiments'' is often greater
 Journal of commitment and motivational value. Also managers may be made aware of
Management issues regarding criteria which could be useful in the process of developing
Development criteria for future use.
With regard to the use of criteria, the findings indicate that managers may
20,9 be well-advised to examine the type of employee that they are appraising as
they select the criteria used in the evaluation process. The findings indicate
768 that input criteria should be used in situations in which the employees are more
likely to be easily observed by their managers and in situations in which
salespeople are less educated. Both of these circumstances parallel the situation
existing in retail selling, where the findings indicate the greater practice of
``input-based'' evaluation criteria. Conversely, managers may opt for the use of
output criteria in situations in which their employees are better educated and
more experienced.
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Thus, the findings of this study suggest that sales force performance
appraisals can be a positive occurrence. The findings also suggest that certain
types of topics may be better suited for some appraisal situations than for
others. Perhaps the major conclusion that may be gleaned from these results is
that managers should engage in a proactive process in performance appraisals.
This process would require that managers ``analytically'' assess the degree to
which their appraisal criteria are perceived as valid by their sales personnel.
Similarly, managers should examine the suitability of the process of
conducting appraisals based on their employees' characteristics. This
assessment might include examining their employees in terms of their sales
roles, supervision, and training, prior to developing the performance appraisal
program. It seems that these efforts should be valuable to sales managers who
want to make the performance appraisal a valuable management tool instead of
another managerial bureaucratic action.

Limitations and suggestions for future research

As is the case with most studies, this research has its limitations. Perhaps one
of the more significant limitations pertains to the sample. The use of a ``mixed''
sample may limit some of the conclusions that could be drawn regarding the
relevancy of the appraisal criteria. Correspondingly, the variation in the types
of positions may have required some variations in the type of criteria used in
the appraisal process.
A second limitation may be due to the personal interview method of data
collection. While the researchers wanted to use personal interviews to ensure
control over the respondents and to enhance response rates, it is possible that
some respondents may not wish to share their true responses to ``socially''
sensitive questions about their perceptions of performance appraisals.
Consequently, these respondents may have provided more ``popular'' answers
rather than their true perceptions of the evaluation process.
Future research might be used to evaluate the perceptions of salespeople in
the same firm and/or in the same industry. This research might also examine
the perceptions of satisfaction experienced by these salespeople, to determine
 the relationship between satisfaction and performance appraisals. Further Performance
research might also assess the relationship between pertinent dimensions of appraisals
salesperson behavior, sales results and various dimensions of performance
appraisals. While future research should be conducted regarding dimensions
such as these, the current research should provide valuable insights to sales
managers as they develop and design their own appraisal programs. These
results provide information to sales managers regarding the criteria, frequency, 769
and other factors of the appraisal process that may be useful in developing and
enhancing the practice of performance evaluations in their firms.

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