1.1.3 Aims and Objectives of the essay
The aim of this essay is to argue the importance of performance appraisal to human resource management and to the organizational performance. Besides, the essay wants to discuss how the context in which the organization is affects the performance appraisal implementation.
1.2 Structure of this essay
This essay will use a case study to explain the arguments of performance appraisal. The contents are divided into four sections. The first section is the introduction. In the second part, this essay will present a literature review to state the theories related to performance appraisal and its relationship with organizational performance. Then a practical case which associated with the themes of this essay will be carried out to illustrate. At last, the essay will draw a summary of questions and give some suggestions
2. Literature review
More and more academic researchers are focusing on performance management and appraisal (Saibou, 2011). The following section will give a literature review on some of the related theories.
2.1 Concepts of performance appraisal and management
Many articles give the definitions of performance appraisal in different angles. This essay will present several previous concepts and opinions on performance appraisal. Performance Appraisal is defined by Denisi and Pritchard (2006) as not only organizational events illustrating performance criteria that can be used in the evaluation process, but also an evaluation process that scores are assigned according to the performance criteria based on how individuals perform in organizations which results are shared to all the employee. Yong (1996) defined it as a periodic measurement of output of employees’ performance against expectations. The process includes assessing and observing the employees’ performance in their work in order to know if their performance meets the pre-standard. Traditional performance appraisal is seen as only a measurement tool, while more modern theory use performance appraisal as an important foundation for decision-making (Rusli and Nur Azman, 2004). Osmani and Maliqi (2012) state that performance appraisal is a collection of communication during a certain period of time. This concept does not mention the function of performance improvement and content about the objectives of an organization. Performance appraisal is also considered as a series of process that include measurement indicators setting, implementing appraisal, appraisal interview and evaluation the effects (Bratton and Gold, 2007).
Because performance appraisal reflects what people do and their performance, performance appraisal system needs to be consistent with the business goals, which means it must be positioned in the strategic context. Otherwise, the appraisal will lose its practical significance (Neely and Gregory et al., 2005).
2.2 How important is performance appraisal to HRM
Performance appraisal is the core part of human resource management. There are a number of reasons for an organization to implement performance appraisal. It has important impacts on many aspects, such as training and development, identifying the advantages and shortcomings of an employee’s performance, promoting, salary administration and so on (Wisniewski and Stewart, 2004). In a word, it plays a critical role in all kinds of human resource management activities. Both private sectors and public sectors should regard performance appraisal as an essential approach to manage its human resource and their performance (Bratton and Gold, 2000). Several academic human resource articles point out that performance appraisals provide information for decisions like salary rising and others. All the decision-making activities need the communication between employers and employees, and they affect the satisfaction and commitment of employee
