HRMT20024 Managing Human Resources

The article sought to analyze the aspect of performance appraisal in the economic downturn and global crisis. The paper seeks to analyze the shortcomings of performance appraisal as a widely accepted employee performance management tool. The key purpose of performance management is the achievement of strategic organizational goals in three areas; increased employee performance, employee development, and administrative tasks.

The method has been widely criticized as failing to find the middle ground between managerial and employee expectations. Despite their execution being the most documented limitations, they have also been characterized by biases. The paper used a study approach where previous research and reports were analyzed. Three areas of performance appraisal were used in the research: the performance appraisal method itself, challenges related to its purpose and what the future appraisal tool should look like.

The findings of the study indicate that the explicit purpose of performance appraisal is defined but the implicit purpose is not. However, the implicit implications are the ones affected when there are challenges in executing the system. This is seen in the fact that employees fail to raise implicit reasons that make them dissatisfied. This means that employees may state explicit reasons when in real sense they mean implicit challenges that they face in the organization.

The system captures data in two ways quantitative or results and qualitative or behavior modes. The outcomes are clearly defined since they relate to quantitative indicators and accepted across cultures while the behaviour modes are difficult to define across cultures. For example, the Japanese cultural system anticipates longer time frame for achieving results. Further, there are challenges in balancing globally and local human resource standards. Performance appraisal systems also fail to capture international challenges like economic crisis that allows managers to take more control of the situation.

Implication for future practice

The appraisal tool needs to be changed to a more formal purpose to define the clarity of the evaluation to the manager and the employee. The clarity forms the strategic goal that the employee works to achieve.

Employee appraisal needs to be done in a place that captures the contextual and cultural factors that define their work environment.  This leads to the fulfillment of explicit and implicit expectations of both employee and management.

A clear definition of the role of parent MNC's influence on appraisal and why the appraisals are not accepted across borders.

An analysis of the cultural context of the employee and how it influences employee performance. This relates to issues like power-distance, collectivist-individualistic, uncertainty-avoidance, and masculinity-feminism.

Changing the purpose of appraisal not to reflect the parent MNC requirements but the local conditions.

The role of globalization in the local context has to be determined.

Therefore managers need to understand the culture and contextual factors that shape employee performance. Thus the performance appraisal process needs to capture the personal and local context of the employee and the organization.

Employee creativity within the organization with the performance appraisal system can be challenging since employees have to conform to the established standards without going outside the established domain. Despite creativity benefiting the organization, encouraging creativity is difficult since most employees are uncomfortable being creativity since it challenges the status quo. The research sought to clarify the ambiguities in the rewards-creativity relationship through analyzing performance management based on intrinsic and extrinsic rewards. The study entailed a sample of 241 employee-peers pairs in different industries. Survey was done

Most organizations use reward systems to encourage employee creativity, but their benefits towards creativity have not been properly documented. The findings of the study indicated that creativity is high when intrinsic motivation is linked to intrinsic tasks. There is a significant effect of these rewards on employee creativity and performance. When intrinsic rewards are used, they increase employee creativity since they enhance their commitment to creativity. The rewards are thus a predictor of positive employee performance since they exert a direct effect on employees when different values of the rewards are used.

On the other hand, extrinsic rewards are contingent on personal characteristics and contextual factors. These rewards lack a direct significant effect on creative performance. They work well on those who place value on the type of reward.

Further analysis shows that interaction between extrinsic and intrinsic rewards to predict creativity performance. Extrinsic rewards improve individual creativity in situations with more intrinsic benefits for the task.  This means that extrinsic rewards need to be used in tasks that have intrinsic characteristics to yield the best results. Therefore, the effects of intrinsic factors are the predictor of effective extrinsic performance.

References

Maley, J. (2013). Hybrid purposes of performance appraisal in a crisis. Journal of Management Development, 32(10), 1093-1112.

Yoon, H. J., Sung, S. Y., & Choi, J. N. (2015). Mechanisms underlying creative performance: employee perceptions of intrinsic and extrinsic rewards for creativity. Social Behavior and Personality, 43(7), 1161-1180.