Human Resource Performance Appraisal System

Human resources with knowledge and competencies are the key assets in assisting organizations to sustain their competitive advantage (Imtiaz Ahmed Ineen Sultana Sanjoy Kumar Paul Abdullahil Azeem, (2013). Globally competitive organizations depend on the uniqueness of their human resources and the systems for managing human resources effectively to gain competitive advantages. Performance evaluation of the human resources is a vital issue in this regard. In creating and implementing an appraisal system, management must determine what the performance appraisal (PA) system will be used for and then decide on the process to implement the system. Performance evaluation is regarded as one of the most powerful human resource practices (Judges and

Performance appraisal provides the employer an opportunity to communicate with the employees about the mission, strategy, vision, values and objectives of the organization, and it personalizes organizational strategy into individual performance criteria (Chattopadhayay, Rachana, Ghosh, Anil Kumar, 2012). It has been observed that employee motivations to perform, to develop capabilities and to improve future performance are influenced by the performance appraisal system (Landy et al., 1978; Kanfer, 1990). According to Saiyadain (1998), the basic purpose of performance appraisal is to judge the relative worth or ability of an individual employee in performing his/her tasks. There are many advantages to using a formal system if performance appraisals are designed and used properly (Murphy and Cleveland, 1995). If objectively done, appraisal can help to identify a superior, moderate and poor performance. The methods chosen and the instruments used to implement these methods are crucial in determining whether the organization manages its performance

However, if the tools and goals of the performance appraisal process are incongruent with organizational goals, the resulting performance appraisal system may, in fact, be a detriment to effective organizational functioning (Barrett, 1967). Furthermore, in a team environment, some believe individual performance appraisals interfere with teamwork by overemphasizing the individual. In fact, many have suggested (for example, Deming) that there is no need for performance appraisal in the organizations of the future. Additionally, ineffective performance appraisal systems may result in mixed messages concerning which aspects of job performance are most and least important, due to the oblique contingency between individual behaviour and organizational rewards. Finally, due to the differing (and often conflicting) needs of stakeholders (the organization, rater, and employee), the process itself is often a source of unmet expectations for all concerned (Murphy and Cleveland,