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Employers often enjoy some discretion in how quickly they extend job offers following candidate interviews. Applicant reactions research suggests that quicker offers are more likely to be accepted. This paper reports an archival study investigating the effect of offer timing on offer acceptance and employment outcomes with field data (N = 3,012) from 1 large company, including both student (N = 906) and experienced (N = 2,106) candidates. The 2 groups differed markedly in their recruiting processes, but job seekers of both types were more likely to accept earlier offers. Further, we found no differences for either performance ratings or turnover among employees hired after quicker offers and those who accepted later offers. It therefore appears that employers may benefit from accelerating their postinterview job offer processes, improving their acceptance rates, and reducing vacancy times without incurring either performance or turnover penalties.
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2010, 63, 223–241
Texas Christian University
University of Arizona
University of Arizona
Employers often enjoy some discretion in how quickly they extend job
offers following candidate interviews. Applicant reactions research sug-
gests that quicker offers are more likely to be accepted. This paper
reports an archival study investigating the effect of offer timing on offer
acceptance and employment outcomes with field data (N=3,012) from
1 large company, including both student (N=906) and experienced
(N=2,106) candidates. The 2 groups differed markedly in their re-
cruiting processes, but job seekers of both types were more likely to
accept earlier offers. Further, we found no differences for either perfor-
mance ratings or turnover among employees hired after quicker offers
and those who accepted later offers. It therefore appears that employers
may benefit from accelerating their postinterview job offer processes,
improving their acceptance rates, and reducing vacancy times without
incurring either performance or turnover penalties.
The Effect of Job Offer Timing on Job Acceptance, Performance,
and Turnover
In a recent survey, 85% of human resources executives indicated that
the single greatest challenge in workforce management was creating or
maintaining their companies’ ability to compete for talent (Lockwood,
2006). Demographic and cyclical labor market pressures are likely to
increase demand for skilled employees in the near future, driving organi-
zations to improve their recruitment, selection, and retention capabilities
(Cappelli, 2005). Improvements in job offer acceptance efficiency could
help them to reach this goal, significantly reducing overall hiring costs and
freeing up resources to bolster new employee assimilation, development,
and retention programs.
Correspondence and requests for reprints should be addressed to W. J. Becker, Depart-
ment of Management, Neeley School of Business, Texas Christian University, Fort Worth,
TX 76129;
C2010 Wiley Periodicals, Inc.
Existing research suggests that speed and timeliness are important
during the hiring process. For example, Arvey, Gordon, Massengill, and
Mussio (1975) found that delays between application and initial inter-
view led economically disadvantaged candidates to self-select out of the
process. Rynes, Bretz, and Gerhart (1991) and Chapman and Webster
(2006) found that postinterview delays in communicating with candi-
dates led to negative perceptions of the organization. Moreover, although
positive interview experiences raise immediate acceptance intentions, the
effect seems to be short lived (Powell, 1991; Turban, Campion, & Eyring,
1995). Further, there is evidence that job seekers entertain relatively few
offers before making their choices, so employers making slow offers may
lose their preferred candidates (Moynihan, Roehling, LePine, & Boswell,
2003; Rynes et al., 1991).1Results of a recent meta-analysis showed that
timely employer response is positively related to self-reported applicant
attraction (Chapman, Uggerslev, Carroll, Piasentin, & Jones, 2005). Sev-
eral authors (e.g., Breaugh & Starke, 2000; Rynes & Cable, 2003) have
identified the entire range of time-related processes and cycle times in the
recruitment and selection process as a priority research area. Neverthe-
less, the Chapman et al. (2005) meta-analysis did not include any studies
that reported results relating offer timing by the organization to accep-
tance intentions or offer acceptance. The purpose of this investigation was
to fill this gap in the literature. We utilized archival hiring data from a
large organization to investigate whether offer timing was related to offer
acceptance, job performance, and turnover.
Hypotheses and Research Questions
The organizational justice literature provides one theoretical perspec-
tive that suggests a mechanism by which job offer timing influences
subsequent offer acceptance. Within this perspective, offer timing can af-
fect offer acceptance through its affect on fairness perceptions. Gilliland
(1993) proposed that job applicants will be less likely to accept a job
offer if they perceive the selection process or their treatment in it to be
unfair. He further suggested that perceived fairness may influence accep-
tance decisions directly, through affective reactions, or indirectly, through
attributions about the organization. Timeliness of selection events and
information is often cited as an important factor in the formation of inter-
actional and procedural justice perceptions by applicants (Folger & Bies,
1989; Tyler & Bies, 1990). Chapman et al.’s (2005) meta-analysis found
that justice perceptions played an important role in acceptance attentions.
1For evidence of similar search restriction in consumer choice, see Iyangar and Lepper
(2000) and Carmon, Wertenbroch, and Zeelenberg (2003).
More specifically, timely response by the organization was included as a
subcategory of justice perceptions, and longer delays were found to have
a negative effect on organizational attraction.
A second theoretical perspective that can be used to inform hypothe-
ses concerning applicant reactions to selection process events is attribu-
tion theory. Several studies have found that selection process delays lead
applicants to make negative attributions regarding the organization and
their own chances of being offered a job (Boswell, Roehling, LePine, &
Moynihan, 2003; Rynes et al., 1991). Open-ended applicant responses
from these studies suggest that these negative attributions decrease ap-
plicant intentions to continue in the selection process and accept offers.
According to Applicant Attribution-Reaction Theory (AART; Ployhart &
Harold, 2004), applicants form largely unconscious and automatic attri-
butions in response to selection process milestones (e.g., receiving a job
offer) or when their expectations are violated (e.g., perceiving excessive
delays in notification of a selection decision). AART proposes that nega-
tive attributions lead to unfairness perceptions and even behavioral conse-
quences, such as withdrawal from the selection process and the rejection of
At the conclusion of their meta-analysis of applicant reactions to se-
lection procedures, Hausknecht, Day, and Thomas (2004) proposed a
theoretical model in which they considered both the organizational justice
perspective and attribution theory. The authors stated that it was unclear
whether applicants viewed the selection process through a justice or attri-
butional lens. They concluded that fairness perceptions, attributions about
the organizations, or both may influence applicants’ reactions in any sit-
uation in which a long delay is present. For example, some applicants
experiencing lengthy delays may dislike the process and form negative
attributions of the organization without viewing the process as unfair.
Nevertheless, it is difficult to conceive of a situation in which the effects
of attributions and fairness perceptions in response to longer delays would
be in conflict. Both perspectives suggest that longer delays between se-
lection stages would lead to unfavorable candidate reactions and reduce
the likelihood of offers being accepted.
In this study, we investigate the relationship between offer timing, the
time between a candidate’s final interview and a job offer being made,
and offer acceptance, whether or not the candidate accepted the offer. In
this situation, both justice and attribution theories predict the same effect
for offer timing. Therefore, we expect that longer time lags in offer timing
are more likely to violate candidate expectations and to contribute to both
perceptions of unfairness and less favorable attributions of the offer and
the organization, thereby reducing the probability that later offers will be
accepted. Therefore, we predict:
Hypothesis 1: Job offer timing is negatively related to the probability
of offer acceptance such that later offers are less likely
to be accepted.
Previous research also provides a number of insights into how offer
timing may impact the amount of time required for candidates to reach a
decision. Rynes et al. (1991) suggested that quicker offers may be inter-
preted by the candidate as a signal of the hiring manager’s enthusiasm and
positive assessment of the candidate. They also found evidence that delays
spurred candidates to perform more elaborate information processing and
to scrutinize information about the organization more closely. Boswell
et al. (2003) interviewed job seekers who were recent college graduates
and found evidence of self-imposed decision deadlines that indicated a
desire to make an expeditious decision once an offer was received. Many
of these job seekers reported imposing decision deadlines upon them-
selves, regardless of whether the organization imposed one. Reciprocity
norms provide a plausible reason for why applicants who receive quicker
offers from the organization would feel pressure to respond with quicker
decisions (Fehr, Fischbacher, & G¨
achter, 2002).
Of course, it is also possible that quicker offers might raise the candi-
date’s estimate of his or her value and therefore promote further job search
and longer decision time. Higher self-esteem and job search self-efficacy
have been linked to more assertive job seeking behavior (Saks & Ash-
forth, 1999). There is no clear theoretical basis to predict how offer timing
will affect candidate decision time. Nevertheless, it will be informative to
explore this issue, as it has not been previously investigated in the field.
Therefore, we explored as a research question the relationship between
offer timing and decision time, which we defined as the time between a
candidate receiving an offer and his or her decision to accept or reject it.
Research Question 1: Is job offer timing related to decision time?
A number of authors have suggested that applicant reactions during
the selection process may spill over into the employment relationship.
Vandenberg and Seo (1992) proposed a model of organizational entry,
in which they suggested that the final job choice plays a significant role
in shaping initial work-related attitudes and behaviors. Specifically, they
proposed that intrinsic satisfaction with the final choice leads to greater
organizational commitment, job performance, and employment stability.
Gilliland (1993) proposed that fairness perceptions formed during the
selection process could have an impact on posthire outcomes such as
work performance and job satisfaction. Two laboratory studies have pro-
vided some support for a positive relationship between applicant fairness
perceptions and subsequent job performance (Gilliland, 1994; Ployhart &
Ryan, 1998).
The spillover effect for negative applicant reactions on turnover has not
been stated as explicitly as the case for performance. Fairness heuristic
theory suggests that initial fairness perceptions contribute to new em-
ployee decisions regarding long term investment in the organization and
subsequent turnover (Lind, 2001). Only one empirical study has investi-
gated the relationship between selection process fairness perceptions and
turnover (Truxillo, Bauer, Campion, & Paronto, 2002). In this longitu-
dinal study of police trainees, the relation between fairness information
provided during the selection process and subsequent turnover was not
significant. Another practical perspective suggests that relatively quicker
offers may be hastier and may be made without due deliberation and con-
sideration of a full range of alternative candidates. Hiring managers may
often prefer to conduct a more deliberate search (losing some promis-
ing candidates during the process but raising their confidence that the
final hire will be a good one). Nevertheless, again, we did not feel that
previous theory and research provided a sound basis for predicting that
relatively quicker final selection decisions lead to more positive or more
negative posthire outcomes. Therefore, we present this possibility as a set
of research questions.
Research Question 2a: Is job offer timing related to job performance?
Research Question 2b: Is job offer timing related to turnover?
We analyzed the hiring records for one division of a Fortune 500
engineering technology company from 2004 to 2006. Candidates were
drawn from all areas of the United States and were recruited by job post-
ings, active sourcing, and on-campus recruiting. Internal candidates were
excluded from the analysis for this study. The records were limited to
exempt positions that were filled externally through the recruitment and
selection of students and experienced candidates. Archival data were ob-
tained for 3,012 candidates (906 student candidates and 2,106 experienced
candidates) who received job offers. Because this study focuses on offer
acceptance and posthire outcomes, candidates who did not receive an offer
were not included.
At the time of the study, the company was growing rapidly and was
hiring new employees to fill engineering and administrative positions at
all organizational levels. The company used traditional recruiting and
selection practices for hiring students and experienced candidates, in-
cluding campus visits and external search firms. In general, recruiters
reviewed resum´
es and conducted campus or phone screenings. Then, the
most promising candidates were invited for structured on-site interviews
with hiring managers and human resources personnel. Student recruit-
ment targeted more prestigious colleges and universities in the fall and
continued throughout the academic year until hiring targets were reached.
Experienced candidates were interviewed for specific vacancies until the
position was filled. Hiring managers indicated that during this period the
organization’s hiring cycle time was shorter than the sector-wide average.
Job offer timing was measured as the time lag in calendar days between
a candidate’s final interview and the organization extending a formal offer
of employment. Job acceptance indicated whether or not the candidate ac-
cepted or rejected the offer. Decision time was measured in days between
the date the organization extended a formal job offer and the date the
candidate notified the organization of his or her decision. Candidate type
was classified as either students (recent or pending graduates of under-
graduate or graduate programs, hired through campus recruiting efforts)
or experienced (professional candidates who were hired through external
recruiting efforts or contracted search firms.)
Performance. For 1,445 of the hired employees, we obtained super-
visor performance ratings for the period of the study. The organization
employs a performance evaluation system that considers multiple aspects
of employee performance, results, and goal attainment. The supervisors
evaluate employees on each dimension and assign an overall performance
rating on a 4-point scale: 1 =needs improvement,2=meets expectations,
3=exceeds expectations,or4=far exceeds expectations. In this orga-
nization, the overall rating was not mathematically derived from the sub-
dimension evaluations. These subdimension evaluations were narrative in
nature and used formally for employee development. Only an overall per-
formance rating was recorded in the personnel records. The organization
invested a great deal of time and resources in performance evaluation, and
these overall ratings factor prominently in subsequent compensation and
promotion decisions. Applicants who accepted offers earlier in the study
period received multiple performance evaluations, whereas those hired
toward the end of the study had not yet received an evaluation. Mean
performance and Year 1 performance were calculated for employees who
received at least one performance rating.
Turnover. Termination date was recorded for each new employee who
left the company before the end date of the study. The data provided by the
organization included a self-reported reason for employment resignation
or termination.
Control variables. Several demographic variables that were of no
direct theoretical interest to this study were coded as potential control
variables. These included gender, ethnicity, whether or not relocation
would have been required, and job level. Job levels define ranges of
employee experience, responsibilities, and compensation associated with
a position. A recent meta-analysis of the applicant reactions literature
found little evidence that gender (ρ=.05), ethnicity (ρ=.04), or age
(ρ=−.04) influence candidate justice perceptions (Hausknecht, et al.,
2004). A complementary meta-analysis of the applicant attraction liter-
ature found a modest positive relationship between pay and job choice
(ρ=.12), but not between location and job choice (ρ=.06; Chapman
et al., 2005). Chapman et al. also found that neither gender nor race mod-
erated the relation between justice perceptions and acceptance intentions
or job choice. Therefore, we did not include gender, ethnicity, or reloca-
tion as controls. Nevertheless, as job level is expected to be moderately
correlated with age, experience, and pay, we did include job level as a
control in the reported analyses.
We subsequently repeated each of the study analyses described below,
with all available control variables. Of these, only relocation requirement
was significantly related to offer acceptance for both student candidates
(B=−1.08, p<.05) and experienced candidates (B=−.76, p<.05).
Gender was significantly related to offer acceptance for student candidates
only (B=.32, p<.05). Further, including these variables as controls did
not impact any of the study findings. The analyses related to Hypothesis 1
and Research Questions 1 and 2, which include all control variables, are
available from the first author upon request.
Preliminary analysis (see Table 1) suggests that the hiring processes for
student and experienced candidates were markedly different. Experienced
candidates competed for higher job levels (M=3.77, SD =1.63) than
student candidates (M=1.16, SD =.37, d=2.21, 95% CI =2.51, 2.72).
Student candidates accepted 67.2% of the offers made to them, whereas
experienced candidates accepted 88.2% (χ2(1, N=3,012) =187.48,
p<.01). Students’ offers came an average of 23.1 (SD =22.60) days
after interview, versus 14.7 (SD =18.11) days for experienced candidates
(d=.37, 95% CI =9.91, 6.86), and their responses to offers took an
average of 21.0 (SD =41.36) days, compared to only 3.1 (SD =12.75)
days for experienced candidates (d=.58, 95% CI =19.83, 15.93). The
student candidates, in short, competed for entry level positions, received
Descriptive Statistics and Correlations for Student and Experienced Candidates
1 23456789
Experienced M14.75 3.13 .88 3.77 .78 .20 .25 2.32 .14
Student MSD18.12 12.75 .32 1.63 .42 .40 .44 .54 .35
1. Offer time lag 23.14 22.60 .04 .12 .04 .01 .00 .00 .02 .01
2. Decision time 21.01 41.36 .10 .22 .08 .03 .00 .06 .01 .01
3. Acceptance .67 .47 .15 .37 .03 .02 .03 .12 –
4. Job level 1.16 .37 .01 .07 .04 .16 .10 .05 .02 .03
5. Gender .71 .49 .16 .07 .07 .09 .02 .06 .05 .01
6. Ethnicity .35 .48 .02 .06 .04 .03 .13 .09 .05 .00
7. Relocation .59 .49 .04 .07 .24 .06 .02 .10 .00 .05
8. Performance 2.37 .54 .07 .05 – .25 .07 .01 .10 .12
9. Turnover .12 .32 .02 .03 – .01 .04 .03 .07 .02
Note. Student candidates are presented below the diagonal and experienced candidates
above. Acceptance was coded 1 for candidates who accepted offers and 0 for candidates
who rejected offers. N=906 for student variables 1–7 (r>.06 is significant at p<0.05).
N=351 and 364 for student variables 8 and 9, respectively (r>.10 is significant at p<
0.05). N=2,106 for experienced variables 1–7 (r>.05 is significant at p<0.05). N=
1,094 and 1,216 for experienced variables 8 and 9 (r>.05 is significant at p<0.05).
much slower offers, responded much more slowly, and accepted offers
less often. This is consistent with a picture of students putting themselves
on the job market in the last year of their programs of study and exploring
a number of job possibilities under no great time pressure. Experienced
applicants, in contrast, presumably know much more about the job market
and their relative position in it, applying for a particular job opening as a
single alternative to their current jobs. Given the substantial differences
between the two hiring processes, we decided to analyze the two samples
The results bearing on Hypothesis 1 show that for both candidate
groups, accepted offers were associated with quicker offers than were re-
jected offers. For experienced candidates, accepted offers were received
after a mean time lag of 13.96 (SD =17.44) days, versus 20.63 (SD =
21.64) days for rejected offers (d=.37, 95% CI =−9.06, 4.03). For
student candidates, the corresponding offer time lag means were 20.72
(SD =21.16) for accepted offers and 28.10 (SD =24.59) days for re-
jected offers (d=.33, 95% CI =−10.49, 4.28). Hypothesis 1 therefore
2We also performed the logistic regression analysis for all candidates simultaneously
and dummy coded for experienced versus student candidates. Consistent with the separate
analyses, we did not find a significant interaction between student/experienced candidates
offer timing for offer acceptance. However, we did find that candidate experience moderated
the effect of offer timing on decision time. This effect was not predicted but is considered
further in the results and discussion.
Summary of Logistic Regression for Offer Acceptance
Var i a b l e BSEOdds ratio Wald R2
Student candidates
Step 1:
Job level .06 .07 .94 .93 .00
Step 2:
Offer time lag .02 .01 .98 13.60 .04
Experienced candidates
Step 1:
Job level .28 .03 1.32 70.70 .06
Step 2:
Offer time lag .02 .00 .98 48.00 .03
Note. Pseudo R2reported using Nagelkerke method. N=906 for student candidates.
N=2,106 for experienced candidates. All coefficients with a Wald statistic greater than
1.96 are significant at the .05 level.
received relatively strong support: Quicker offers were associated with a
higher probability of offer acceptance in both the student and experienced
candidate groups. Binary logistic regression, shown in Table 2, confirmed
the effect of offer timing on the probability of acceptance for student
candidates (B=−.01, p<.05) and experienced candidates (B=−.02,
p<.05) controlling for job level in both groups.
Research Question 1 was aimed at understanding the relation between
offer timing and decision time. For the experienced candidates, offer tim-
ing was not significantly related to decision time. For the student sample
there was a significant negative relationship between offer timing and de-
cision time (r=−.10, p<.05), indicating that later offers were associated
with quicker decisions. Hierarchical, moderated logistic regression anal-
ysis confirmed the difference in these relationships across the samples,
indicating that there was a significant interaction between offer timing
and candidate experience influencing decision time (B=−.36, p<.05).
Although neither outcome suggested evidence of reciprocity norms, it is
possible that quicker offers might have increased student applicant confi-
dence and led them to search for other jobs, thereby creating longer deci-
sion times. In summary, there is a weak affirmative response to Research
Question 1, indicating that quicker offer timing led to longer decision
times but only in the student sample. We explore additional relationships
between decision time and offer timing in the post-hoc analyses below.
Research Questions 2a and 2b were aimed at understanding whether
offer timing would be related to two posthire outcomes: job perfor-
mance and turnover. We were able to match recruiting and performance
data for 1,445 applicants (1,094 experienced candidates and 351 student
candidates) who accepted offers during the study period and for whom at
least one performance review was available.3We should note that there
were some modest differences between the makeup of the matched and
unmatched records. The employees for whom recruitment and job perfor-
mance variables could be matched had a longer mean offer time lag (d=
.12) and a higher percentage of experienced candidates (d=.09) and men
(d=.16). There was no indication in the data or from discussions with
the organization to suggest systematic differences between the matched
and unmatched records. For those employees with recruitment and job
performance data, offer timing was not significantly related to initial su-
pervisory performance ratings at the end of the first year of employment
for either student candidates or experienced candidates.4Therefore, the
results suggested a negative response to Research Question 2a.
We were also able to match recruitment variables and current em-
ployment status for 1,580 individuals (1,216 experienced candidates and
364 student candidates). Of these, 210 (161 experienced candidates and
43 student candidates) had left the organization as of July 2007. Only
three of these employees were involuntarily terminated, which precluded
an investigation of possible differences between voluntary and involun-
tary turnover. Mean offer time lag was not significantly different for new
employees who quit and those who stayed during the period of the study
for either student or experienced candidates.
We also examined the mean offer time lag for recently hired student
and experienced employees who terminated within 3, 6, 9, and 12 months
of their hiring date. We did so in order to explore whether offer timing
might be related to turnover for those who left soon after being hired
but not for those who left later. We did not find any significant differ-
ences (all p>.05). These results suggest a negative response to Research
Question 2b.
In summary, the results did not suggest any evidence of a relation-
ship between offer timing and posthire outcomes. Offer timing was not
related to either performance ratings or turnover among those candidates
3The organization maintained separate databases for their recruiting and personnel
records with different unique identifiers. There was a policy in place for manually up-
dating the recruiting database, but we were unable to link the records of 872 applicants who
accepted offers (36%) because of missing identifiers between the recruiting and personnel
databases. An additional 138 new employees (6%) had not yet received a performance
evaluation due to their short tenure.
4Separate analyses of individual initial and annual performance ratings were also ana-
lyzed with and without the full range of available control variables. These models yielded
the same overall results and did not account for any incremental variance above the analysis
Post-Hoc Analyses
In the course of analyzing the data, we also encountered several find-
ings that did not relate directly to our hypothesis or research questions but
that may help explain our null or weak findings, inform future research,
or have practical application. We did not find the positive relationship
between offer timing and decision time predicted by reciprocity norms.
On the contrary, student candidates demonstrated a significant negative
relationship between offer timing and decision time. Nevertheless, we
also found that decision time was associated with whether or not the can-
didate ultimately accepted the offer. Experienced and student applicants
accepted job offers more quickly than they rejected job offers. For expe-
rienced candidates, the mean decision time was significantly shorter for
accepted offers (M=2.08, SD =9.82) than for rejected offers (M=
10.95, SD =24.28), d=.48, 95% CI =−10.51, 7.22. For student
candidates, the corresponding means were 10.32 (SD =22.52) and 42.93
(SD =58.92) days (d=.73, 95% CI =−37.94, 27.26), respectively.
We further explored the relationship between offer timing and deci-
sion time in students. The negative relationship between offer timing and
decision time indicated that, on average, students made their decisions
more quickly when they received later offers. After an offer time lag of
greater than 15 days, 66% made decisions within 2 days. For an offer time
lag of 15 days or less, only 38% of student candidates made decisions
within 2 days. We regressed decision time on offer timing in a polynomial
regression, in order to test the potential for a curvilinear relationship, but
the quadratic term in this regression equation was not significant. Instead,
we found that there was a significant interaction between offer timing
and offer acceptance in predicting decision time (R2=.17, F(3,902) =
64.83, p<.05). Offer rejections generally followed long decision times
when offers were made more quickly but came after much shorter deci-
sion times for slower offers. Decision times for candidates who accepted
offers were relatively unaffected by offer timing. Therefore, the results
suggested that faster offers to student candidates led to either relatively
quick acceptances or long decision times that were more likely to end in
offer rejection.
We did not find a relationship between offer timing and turnover.
Nevertheless, of the employees who left the organization, experienced
candidates were more likely to leave sooner than student candidates. The
mean tenure of experienced new employees who left the organization
during the period of the study (M=408.57, SD =16.56) was significantly
shorter than that of student new employees who left (M=513.12, SD =
205.31; d=−.72, 95% CI =−176.13, 32.97). In addition, we found
a difference in performance ratings when comparing leavers and stayers
within the group of experienced hires. For experienced hires, the mean
performance of those who left was 2.13 (SD =.56) versus 2.34 (SD =
.54) for those who remained (d=−.38, t(1,092) =3.98, p<.05).
Therefore, within this group, lower performers were more likely to leave
the organization than were higher performers.
This study makes several important contributions to the selection and
applicant reactions literatures. First, it investigated actual applicants for
salaried positions that are typically associated with long-term careers.
Second, this study investigated the influence of offer timing on offer
acceptance and posthire organizational outcomes. Timeliness of offers
represents one of the few selection process variables that can be modified
by organizations relatively easily. Third, this study included experienced
job candidates and therefore responded to calls for research including this
population (Breaugh & Starke, 2000; Rynes & Cable, 2003). Finally, it is
the only study of which we are aware that tests the relationship between
a specific characteristic of the selection process and actual job choice
decisions and posthire organizational outcomes.
Offer Acceptance
The central finding of this study is that both student and experienced
candidates were more likely to accept job offers that were received sooner
rather than later following the final selection interview. This finding is
consistent with the predictions of applicant reaction models based on the
organizational justice perspective and attribution theory (Gilliland, 1993;
Hausknecht et al., 2004; Ployhart & Harold, 2004). This finding also
extends previous research in selection and other fields by linking a specific
and controllable characteristic of the selection process to actual applicant
decisions (Boswell et al., 2003; Iyengar & Lepper, 2000; Rynes et al.,
1991, Soelberg, 1967). The modest effect sizes for offer timing shown
in Table 2 are in fact practically important. Increased acceptance rates,
reduced search costs, and lower vacancy times can provide substantial
overall cost savings. Human resources managers conservatively estimated
that each site interview costs approximately $1,200 (including travel and
lodging) and vacant positions cost an average of $1,000 per day in lost
productivity. Moreover, cost savings associated with quicker offers appear
not to result in any detectable increase in the rate of unsuccessful hires,
as evidenced by lower performance or higher turnover.
Organizational justice and attribution theories suggest that system-
atic differences in applicant reactions and behavior may be due to the
effect of salient and available information from selection events (Gilliland,
1993; Ployhart & Harold, 2004). All of the applicants included in this
study received favorable selection decisions, yet the results suggest that
offer timing had a significant impact on applicant acceptance decisions.
Later offers are more likely to violate applicant expectations and produce
less favorable reactions to the offer and the organization. Applicants may
conclude that the organization is not very interested in them, inefficient,
and/or unfair and therefore not a very attractive employer. Timely offers
also likely influence candidates in several other important ways. For one,
extending an offer eliminates uncertainty from the candidate’s evaluation
of the job. Uncertainty imparts a salient and negative aspect to a choice
option that makes it much less attractive than a certain option (Kahneman
& Tversky, 1979). In addition, prompt offers may be interpreted by can-
didates as a signal of greater interest on the organization’s part (Rynes
et al., 1991) and make the offer more attractive to the candidate.
This is the first study to examine simultaneously offer acceptance
and employment outcomes of both student and experienced candidates,
allowing a comparison that has been of concern to several researchers
(Chapman et al., 2005; Rynes, Orlitzky, & Bretz, 1997). Gilliland (1993)
proposed that previous experience with selection processes would lead to
more accurate schemas and expectations for this selection process. We
found a number of significant between-group differences. On average,
experienced candidates received quicker offers, made faster decisions,
and were more likely to accept offers than were student candidates. De-
spite these differences, we did not find evidence that applicant experience
moderated the effect of offer timing on offer acceptance.
Candidate Decision Times
In exploring our first research question, we did not find support for
reciprocity norms in candidate decision times. Nevertheless, post-hoc
analysis provided evidence that candidate experience moderated the ef-
fect of offer timing on candidate decision time. We did not predict this
finding a priori. In terms of the time needed to make decisions, experienced
candidates were relatively insensitive to offer timing. In contrast, student
candidates responded to quicker offers with either quick acceptance de-
cisions or longer delayed decisions, which were more likely to produce
offer rejections. Unfortunately, the data did not offer further insight into
this seemingly contradictory finding. Human resources managers within
the organization indicated that the organizational procedures for student
and experienced recruitment and selection were quite different. The orga-
nization used separate recruitment personnel for student and experienced
candidates, and the selection process was more flexible for experienced
The organization under study did not impose candidate decision dead-
lines. This may have contributed to the conflicting decision time findings.
We did not find evidence of consistent candidate self-imposed decision
deadlines suggested by the Boswell et al. (2003) qualitative study of stu-
dent job seekers. The negative relationship between decision time and
offer timing for student candidates suggests that quicker offers are more
likely to result in offer acceptance but may also produce some longer
candidate decision times that end in offer rejection. These results would
be consistent with the findings that a small portion of student candidates
who received quicker offers pursued further search, whereas those who re-
ceived later offers made relatively quicker decisions and were more likely
to reject the organization’s offer. Experienced candidates, on the other
hand, may often use job search to test the waters or to attempt to improve
their bargaining power with their current employer (Bretz, Boudreau, &
Judge, 1994). They are also more likely to have reached their decisions to
accept or reject a potential offer prior to the final interview. Furthermore,
lengthy offer time lags may cause them to drop an organization from con-
sideration. Our findings suggest that experienced candidates tend to be
more decisive and return relatively quicker decisions, regardless of offer
timing or their decision to accept or reject the offer.
Posthire Outcomes
In exploring our posthire research questions, we did not find evi-
dence that offer timing had spillover effects on subsequent performance
or turnover. Individuals who received slower offers performed no worse
on the job than those who received relatively quicker offers and were no
more likely to exit the organization during the first years of employment.
This result did not support the predictions of models of applicant reac-
tions that longer delays contribute to unfairness perceptions and negative
attributions that negatively influence posthire outcomes (Gilliland, 1993;
Hausknecht et al., 2004). It also contradicts the conventional belief we
encountered among human resources personnel and hiring managers that
organizations primarily extend quick offers to the most outstanding candi-
dates, who later become higher performing employees. The results suggest
that making quicker final selection and offer decisions likely will not have
a positive or negative influence on performance or turnover. This is con-
sistent with the findings that candidate reactions to selection processes are
relatively fleeting (Powell, 1991). The evidence suggests that although
fairness judgments and affective reactions regarding the recruitment and
selection process played an important role in offer acceptance, they likely
had little impact on longer term employment outcomes.
Alternative Explanations
The primary strength of archival studies is the application of real
world data to reduce the number of viable explanations for observed
phenomena. Archival studies also have inherent weaknesses. The data in
this study were collected by the organization for their own purposes, and
we therefore had no control over what variables were collected. Therefore,
important variables such as justice perceptions, attributions, applicant
quality, alternative offers, and the organization’s reasons for offer timing
were not available. This created an unmeasured variables problem that
limits our ability to make direct conclusions regarding the effect of offer
timing on justice perceptions and attributions. It also does not allow us
to rule out alternative hypotheses related to the unmeasured variables
(James, 1991). Therefore, in addition to pointing out where the results are
consistent with the predictions of justice and attribution theories, we also
address a number of alternative explanations and provide any additional
relevant information that could be obtained from the available data to
weaken the alternative explanations.
Conventional wisdom suggests that organizations might extend prompt
and attractive offers to highly rated candidates to forestall alternative of-
fers. This alternative explanation is also consistent with our archival data.
Nevertheless, interviews with human resources managers and generalists
in the organization indicated that the organization preferred to make strong
initial offers regardless of offer timing. Moreover, the financial terms of
offers extended to student candidates were almost entirely formulaic and
were based on degree and grade point average. Therefore, highly rated
experienced candidates may have received quicker and more lucrative
offers, but highly rated student candidates would have received quicker
but not richer offers. If the financial terms of faster offers were the pri-
mary driver behind offer acceptance, experienced candidates, rather than
students, should have shown a greater preference for earlier offers. Our re-
sults suggested that the relation between offer timing and offer acceptance
for these two groups was not significantly different.
Another alternative explanation for our results is that longer time lags
between interviews and offers could provide candidates additional time
to pursue and accept alternative offers from other organizations. The data
included each candidate’s reported reason for declining an offer. In a
post-hoc analysis, we found 224 offers that were declined in favor of an
alternative offer. We did not find a significant relation between offer timing
and candidates declining in favor of an alternative offer for either student
candidates or experienced candidates. Logistic regression confirmed that
longer offer time lags did not significantly increase the likelihood that
an offer would be rejected in favor of an alternative for experienced or
student candidates. Although we acknowledge the relative weakness of
this self-reported measure of job alternatives, these results do provide
some evidence that the observed effect was not simply the result of longer
time lags leading to the generation of alternative offers.
A limitation of this study was its restriction to a single organization—
one that was also a very attractive employer, as judged by its industry
status and high offer acceptance rate. This organization was a high-skill,
high-wage employer, and generalizability to nontechnical employers is
uncertain. The relative attractiveness of the organization, indicated by its
high overall offer acceptance rate, would have weakened our ability to
detect the predicted relationship between offer timing and offer accep-
tance. This would make our results conservative. There may also be some
concern over the potential effects of range restriction because only the
better qualified applicants received interviews and a relatively small per-
centage of candidates who interviewed received offers. During the study,
the organization extended offers to 32% of candidates interviewed (30%
of experienced candidates and 36% of student candidates). We were pri-
marily concerned with actual offer decisions, and the nature of the study
prevented us from observing the job choices of candidates who did not
receive offers. It is possible that less highly qualified candidates could be
more influenced by offer timing than those in this study. These candidates
would enjoy fewer alternative offers and would, presumably, seize oppor-
tunities more eagerly. Therefore, we expect our results to be a conservative
estimate of the broader impact of quicker job offers.
The single-item supervisory performance rating suffers from a number
of shortcomings that may have contributed to the null findings. Nonethe-
less, this performance measure is generally accepted as an adequate mea-
sure of performance in field settings (Arvey & Murphy, 1998; Judge &
Ferris, 1993). Given the relatively large sample sizes, we should have had
sufficient power to detect relatively small effects, even with the poten-
tial reliability concerns with this performance measure. The low turnover
rate within the first year and apparent lack of involuntary turnover may
have limited our ability to detect a relationship between offer timing and
turnover. The available measures also did not provide insight into the
actual reasons behind observed offer timing (e.g., perceived candidate
quality, organizational inefficiency, or manager indecision).
These limitations suggest a number of potentially fruitful avenues for
future research. A similar analysis of the archival records of an organiza-
tion from a low or medium wage industry could answer questions about
how the effects observed in this study vary with job type and candidate ed-
ucation and aptitude. Such organizations generally have lower acceptance
rates and higher turnover (Jones & Skarlicki, 2003). Given the difficulty
of measuring candidate fairness perceptions and attributions in the field
(Ployhart & Harold, 2004), a laboratory experiment of simulated job offer
decisions could explore the effects of offer timing with candidates who
exhibit more variance on aptitude-related variables. An experiment would
also allow for conclusions regarding causal relationships concerning the
effect of offer timing on fairness perceptions, attributions, and offer ac-
ceptance. It is possible that longer offer lag times could lead candidates
to believe that they are not the organization’s first choice. Perceptions of
second-choice status could have unique effects on acceptance decisions.
Finally, a longitudinal study of active job seekers throughout the interview
and job choice process could explore the actual attributions formed by job
seekers in response to selection process timing across multiple ongoing
job opportunities. This would allow researchers to better understand the
actual job choice process and directly test the predictions of justice and
attribution theory.
With regard to practice, this study demonstrates that organizations may
be able to improve offer acceptance rates by reducing lag times between
final interviews and the extension of job offers. This increased efficiency
can likely be obtained with minimal changes to existing selection proce-
dures. Further, the changes would require little financial cost to implement
and could produce substantial long term savings for the organization in
terms of time and money spent recruiting and selecting new employees.
Our results also provide additional support for the utility to the organi-
zation of imposing candidate decision deadlines. Student applicants who
took longer to announce their decision were more likely to reject the offer.
This study extends our understanding of how timing in the final phases
of selection impacts offer acceptance and employment outcomes. It sug-
gests that organizations may benefit from extending early offers to all
candidates who have successfully passed through a preliminary selec-
tion process and who perform well in final selection interviews. Candi-
dates in this study who received earlier offers were more likely to accept
them. Those who received delayed offers—whether due to hiring manager
indecision or other reasons—ultimately performed as well on average as
candidates who received earlier offers. Longer offer time lags ultimately
cost the company in terms of longer vacancy times and decreased likeli-
hood of offer acceptance, without improving the average performance of
new employees.
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... These effects were, however, not observed for experienced job seekers. Hence, quicker offers to students led to either relatively quick acceptances or long decision times ending in rejections (Becker et al., 2010). ...
... Early engagement with potential talent, sometimes even before formal recruitment begins, can also prove beneficial as a "first to market" strategy, as first impressions of potential employers can bias preferences, application behavior, and eventually job choice (Swider et al., 2015;Swider & Steed, 2021). Furthermore, novel findings suggest that extending quicker offers helps boost acceptance rates, where reduced vacancy times also do not appear to have negative consequences on subsequent performance and new hire turnover (Becker et al., 2010). ...
... For example, the limited available research seems to support the benefits of early engagement with potential candidates for eventual job choice (Campion et al., 2017;Swider et al., 2015Swider et al., , 2021. Similarly, Becker et al. (2010) highlight the importance of extending offers as soon as possible after a hiring decision has been made. ...
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Effective recruitment of talent remains extremely critical. As part of Personnel Psychology's 75‐year anniversary celebration, we review the state of recruitment research, emphasizing the journal's extensive contributions to this literature. Specifically, we review contributions and opportunities in terms of the recruitment outcomes that have been studied, theoretical progress that has occurred, and methodologies that have been employed to inform scholarship and practice. Throughout, we particularly highlight trends that have occurred over the years in the pages of Personnel Psychology. We conclude with several implications for practice and directions for ongoing recruitment research. This article is protected by copyright. All rights reserved
... There has been a call in the literature (e.g., Becker, Connolly & Slaughter, 2010;Breaugh & Starcke, 2000;Rynes & Cable, 2003) for more research concerning recruitment cycle times and time-related processes. Chapman and colleagues (2005) conducted a meta-analysis of applicant attraction to organisations research and one aspect covered timeliness of feedback. ...
... In view of this shortcoming Becker, Connolly, and Slaughter (2010) examined job offer acceptance statistics for applicants at a Fortune 500 engineering technology organisation based in the USA. The researchers analysed archival data from the period 2004-2006 for student entry-level (N = 906) and experienced (N = 2,106) job applicants. ...
A main aim of this doctoral research was to examine job applicant reactions towards online testing, and specifically different forms of feedback provision. As job recruitment is a `bilateral process` with the recruiters aiming to employ a candidate, and from the candidate`s perspective the feedback provision and selection process may indicate the employer`s future behaviour in determining whether they accept a job offer. The research is underpinned by organisational justice theory and by Gilliland’s (1993) organisational justice model. This model considers how elements of procedural and distributive justice interact and examines the effect such fairness reactions have in terms of individual and organisational outcomes. The research was designed to build on a literature review, followed by a pilot study to test several psychological constructs to explore applicant feelings in a field setting. This preliminary phase then informed the experimental phase. The first experiment compared applicant reactions to paper-and-pencil testing compared to online testing, and to positive and negative feedback. Having established no clear differences in test-takers fairness and justice reactions across mode of test administration on a verbal (i.e. comprehension) ability test, the second experiment then focused on test-reactions towards online testing which are nowadays more widely used in graduate recruitment. Interpersonal, non-interpersonal, and combined forms of feedback were manipulated, alongside three types of feedback messages (passed, reject no explanation, reject with explanation), after participants had undertaken two online tests. Perceived stress was found to increase when rejection was reinforced with an automated report compared to interpersonal feedback, whereas with a positive outcome there was decreased stress in the report condition. These findings suggest that personal communication is important when there is bad news. These insights paved the way for the field study. In this field study, candidates who had recently applied for a job position involving some aspect of online testing were invited to participate in a self-report survey. The aim of the study was to investigate feelings of fairness and justice, and to compare outcome favourability (job offer, rejection), and the effect of providing explanations (or no explanations) to candidates within a field setting. Findings revealed the applicants’ preference of holistic (overall performance) over mechanical (one aspect of performance) explanations of recruitment decisions, while perceptions of fairness and justice were based on outcome favourability. Furthermore, feedback acceptance fully mediated the effect of outcome favourability (job offer, rejection) and process fairness, clear and open manner, and organisational fulfilment obligations. Pertinently, providing an explanation of the recruitment decision resulted in lower stress irrespective of a positive or negative outcome. This finding suggests that an explanation of recruitment decisions can mitigate the psychological effects of rejection and enhance candidate reactions towards the recruiting organisation. In summary, this research has made some important contributions to the field of occupational selection by investigating applicant reactions to online testing. It has highlighted the importance of feedback and its beneficial psychological effect on applicants irrespective of decision outcome. This new insight allays fears of feedback having detrimental effects by recruiters, often due to litigation and image concerns. The research employed experimental and field studies to highlight these issues.
... This study is focused on understanding the candidate's expectations to accept an offer.This would help the organizations to work on it and hence reduce the job offer declines. William J. Becker et al. (2010) presents field data (N = 3,012) from one big organization, encompassing both students (N = 906) and experienced (N = 2,106) candidates, to investigate the influence of offer timing on offer acceptance and employment outcomes. Although the two groups' recruitment practices differed significantly, both types of job searchers were more inclined to accept early offers. ...
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Abstract: The study was done to understand the job offer decline in organizations. Organizations spend a lot of time for recruitment to ensure the best manpower or the human resource for the company. Human resources were considered as the cost centered sectors of a company but now companies realized importance of human resource and started considering as profit centered sector. Therefore the modern day recruitments are considered with much importance and companies compete to attract potential candidates. Therefore, it is important to study over the factors affecting the job offer decline happening in organization. The various factors mainly focusing on the organizations and the factors related to it are studied. Organizations brand value and employee benefits are to be taken care of in order to attract potential candidates to organization. Keywords: Job offer decline, Employee Benefits, Company Brand Value
... Turban and Cable (2003) indicate that the delay in the recruitment process results in a smaller number of applications per ad, but also a lower reported quality. In addition, job seekers want to minimize uncertainty in finding jobs which is another reason for timely recruitment (Becker et al., 2010). ...
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In India One of the major sources of hiring freshers is through on and off campus hiring. The offer to joining hit rate is low in fresher graduate hiring through on and off campus hiring, this was the problem identified while working in an IT firm in Bangalore. The purpose of this study is to assess reasons for offer declines and study the effect of candidate experience in offer acceptance decision. The suitable data was collected through a questionnaire with 150 respondents. Percentage analysis, meta-analysis and factor analysis was carried out using MS excel and SPSS package. The study shows that salary, bond period and job description are the important factors candidates consider while applying for a company. Better offer, bond period and opting for higher education are the major reasons for offer decline post acceptance. INDEX TERMS: Offer decline and acceptance, Candidate experience, campus hiring, recruitment, Off-campus hiring, fresher hiring.
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O razvoju posameznika v delovnem okolju gotovo veliko ve organizacijska psihologija kot znanstvena in aplikativna veda, ki uspešno povezuje znanstvene ugotovitve s prakso. V znanstveni monografiji Kako (še) spodbujati zaposlene: nov izbor psiholoških pristopov od A do Ž so avtorji zbrali različne metode in pristope, ki jih lahko uporabite v prav vsaki delovni organizaciji. Knjiga je nadaljevanje monografije Kako spodbujati zaposlene: psihološki pristopi od A do Ž, ki je bila izdana leta 2020. V tokratni knjigi predstavljajo popolnoma nove, samostojne ali dopolnjujoče se metode, ki jih lahko uporabite pri zaposlovanju, motiviranju in vodenju ter pri oblikovanju organizacijske klime in kulture.
Using activation theory, this study explores the possibility of an inverted U-shaped association between abusive supervision and subordinates’ performance in India, characterized by a hierarchical culture. Our first study examined the role of subordinates' conscientiousness as a moderator in this curvilinear relationship. Hierarchical regression analysis results illustrate that subordinates’ conscientiousness moderates the curvilinear effects such that these effects remained when conscientiousness was high but were rendered insignificant when conscientiousness was low. We conducted a second study to investigate the driver of these curvilinear effects. We found that subordinates’ attentiveness partially mediates the curvilinear effects of abusive supervision on job performance. Across both studies, multi-source data was collected from full-time employees and their immediate supervisors across different time points. Implications for theory and practice are discussed.
Intelligence agencies face notable problems in recruitment. In particular, candidates can easily misunderstand intelligence assessments roles. Challenges sit on the recruiter’s side too. Some of the traditional methods, particularly the over-reliance on the ‘classic trio’ of a curriculum vitae, an interview and referee checks yield inferior results and weaken diversity. The inclusion of a wider range of selection tools and tests not only improves an ability to adjudge applicants, it also gives candidates a much better sense of the role applied for. John Wanous’ Matching Model is utilised to demonstrate that employment ought to be a two-way process of attraction.
The standard assumption in social learning environments is that agents learn from others through choice outcomes. We argue that in many settings, agents can also infer information from others’ response times (RT), which can increase efficiency. To investigate this, we conduct a standard information cascade experiment and find that RTs do contain information that is not revealed by choice outcomes alone. When RTs are observable, subjects extract this private information and are more likely to break from incorrect cascades. Our results suggest that in environments where RTs are publicly available, the information structure may be richer than previously thought. This paper was accepted by Yan Chen, decision analysis.
Conference Paper
Although laboratory studies have found that selection information can affect applicant perceptions, this has not been tested in the field. The authors followed 2 cohorts of police applicants (N = 274) in a longitudinal Study to examine the relationship between information, applicant perceptions, and behavior (e.g., turnover). Information was related to perceived fairness measured at the time of testing and I month later when applicants received their results. Information moderated the relationship between outcome favorability and test-taking self-efficacy among African Americans but not among Whites. Information was not related to the behavioral measures. The discussion focuses on why certain findings from previous studies were not replicated and on the use of information when applicants have an investment in getting a job.
Conference Paper
This study examined several unexplored issues in research on applicants' perceptions of fairness. First, the study explored possible differences between procedural violations that advantage individuals vs. those that are disadvantageous. Second, the study examined the complex relationship between process and outcome fairness across the stages of the selection process. A longitudinal, simulated selection process was used; procedural justice was manipulated by varying the consistency of test administration, and distributive justice was manipulated by varying perceptions of equity. Results indicate that favorable rule violations are perceived similar to rule satisfaction and that a complex and dynamic relationship exists between process and outcome fairness.
Over the last thirty years, the amount of research on recruitment topics has increased dramatically. Despite this increase, recent reviews of the recruitment literature often have had a somewhat pessimistic tone. Reviewers have concluded that we still do not know a great deal about why recruitment activities have the effects they do. In particular, recent reviews have criticized many of the studies conducted for being poorly designed, narrow in focus, and not grounded in theory. We believe that many of these criticisms are legitimate. We also believe that, in order for future studies to result in a better understanding of the recruitment process, such studies need to be designed with an appreciation of the complexity of the recruitment process (i.e., the number of variables involved and the nature of their relationships). In this regard, we offer an organizing framework of the recruitment process. In introducing this framework, we draw upon theories from a variety of research domains and give considerable attention to process variables (e.g., aplicant attention, message credibility, applicant self-insight) that mediate the relationships between recruitment activities (e.g., recruiter behavior) and recruitment outcomes (e.g., the number of applications generated). Having introduced an organizing framework, we selectively review recruitment research, giving particular attention to the topics of recruitment sources, recruiters, and realistic job previews. This review makes apparent a number of important issues that recruitment research has yet to address.
The management of most company's daily operations abounds with highly programmed decisions: Consider merely the highly routinized rules that normally guide the everyday management of inventories, production schedules, machine and manpower allocations, cost estimation, mark-up pricing, etc. The more famous scientific description of a case of highly programmed decision making is perhaps G.P.E. Clarkson's, in which it was demonstrated that the portfolio selection decisions made by a bank trust investment officer were so well programmed that his decisions could be predicted by a computer, six months after his investment rules had been elicited by an interviewee.[2] This study, in contrast. focuses on highly unprogrammed decision making. This is a subject that usually gets relegated to the mystical realm, managerial "judgement". Critical decisions are produced every day for which the decision maker (Dm) has available no identifiable rules or pre-programmed decision procedure.
The role of social and situational influences in the performance-rating process has received relatively little research attention yet merits increased attention. Although there has been acknowledgment of the role of social and situational factors in shaping rater cognition and evaluation, research has typically proceeded in a piecemeal fashion, isolating a single variable at a time. Such an approach fails to recognize that performance rating is a process with multiple social and situational facets that need to be considered simultaneously. In the present study, we tested a model of the performance-rating process, employing several social and situational variables that have been infrequently investigated and typically not in conjunction with one another. Results indicated support for the overall model and specific links within it. Implications of the results for performance-rating research are discussed. There is perhaps not a more important human resources system in organizations than performance evaluation. Supervisors' ratings of subordinates' performance represent critical decisions that are key influences on a variety of subsequent human resources actions and outcomes. Indeed, this pivotal role of performance evaluation has promoted systematic efforts to develop a more informed understanding of the performance-rating process. Landy and Farr (1980) issued a call for research investigating the cognitive processes underlying performance appraisal decisions. Although the process focus has generated considerable research concerning various components of performance-rating decisions, more comprehensive investigations incorporating several of those components has been lacking. Furthermore, process-oriented research has been limited by its reliance on laboratory studies (DeNisi & Williams, 1988). Whereas the cognitive processes involved in performance-rating decisions can be well illuminated in laboratory studies, the "quiet" nature of laboratory studies often does not match the "noisy" context in which performance-rating decisions are actually embedded (Lord & Maher, 1989).
This paper provides an overview of the literature on interorganizational relationships. Although the literature on interorganizational relationships is extensive, a pervasive theme that is either explicit or implicit in the majority of the articles is the simple notion of whether interorganizational relationships make sense and whether the advantages outweigh the disadvantages. This article reviews six widely used theoretical paradigms that explain interorganizational relationship formation, including transaction costs economics, resource dependency, strategic choice, stakeholder theory, organizational learning, and institutional theory. Although each paradigm alone is insufficient to capture the complexities of interorganizational relationship formation, the fact that interorganizational relationships can be justified from such diverse theoretical backgrounds is impressive. The paper also reviews the six forms of interorganizational relationships most commonly pursued in practice and discussed in the literature, including joint ventures, networks, consortia, alliances, trade associations, and interlocking directorates. Through these discussions, we elaborate on the potential advantages and disadvantages of participation in interorganizational relationships.