| Performance appraisal is one of the popular | | | | further explained with the help of the |
| concepts among the multinational and local | | | | example of Nokia. Nokia has incorporated |
| companies. The concept has been defined by | | | | performance appraisals in its compensation |
| DeVries et al., (1981) as the process which | | | | plans for its employees. The company has |
| allows firms to measure and consequently | | | | adopted the philosophy of pay-for-performance |
| evaluate an employee's achievements and | | | | and therefore measuring and gauging different |
| behavior over a certain period of time. The | | | | performance indicators of each employee is |
| basic purpose of using performance appraisal | | | | essential to the company. Nokia is an |
| techniques within an organization is to align | | | | innovative firm with a global matrix |
| the employee's efforts with the overall | | | | structure and a typical line management |
| objective of the firm.There has been a | | | | configuration at the country level. Therefore |
| widespread discussion within the academic | | | | the performance appraisal system called |
| circles as to how to define performance | | | | 'Investing in People' has been designed as |
| (Papers4you.com, 2006). Drawing upon Briscoe | | | | 360 degree feedback and electronic briefing |
| & Schuler (2004) performance can be viewed as | | | | sessions (Pollitt, 2004), which are perfectly |
| a combination of several variables, such as | | | | aligned with the structure and overall aim of |
| motivation, ability, working conditions and | | | | the company.It can be concluded from the |
| expectations. It has been established that | | | | discussion that valuable organizational |
| there are certain factors that affect | | | | objectives are served with the help of |
| employees' performance more than others. | | | | performance appraisals and organizations |
| These factors, according to Dowling et al | | | | should use the technique by aligning the |
| (1999) include the compensation package; the | | | | performance parameters with their overall |
| nature of task; support from higher | | | | mission and vision.References:Briscoe, D. & |
| management; the working environment and the | | | | Schuler, R. (2004), "International Human |
| overall corporate culture.There are many | | | | Resource Management" 2nd Ed., |
| advantages mentioned in the literature | | | | RoutledgeDowling et al (1999), "International |
| regarding the use of performance appraisals | | | | Human Resource Management - Managing People |
| within an organization (Papers4you.com, | | | | in a Multinational Context" 3rd Ed., |
| 2006). It has been suggested that it improves | | | | International Thomson PublishingDeVries, |
| the communication between the higher to lower | | | | D.L., Morrison, A.M., Shullman, S.L., |
| level management; identify areas of | | | | Gerlach, M.L. (1981), "Performance Appraisal |
| improvement; show employees training needs; | | | | On The Line, Center for Creative Leadership", |
| help in promotion, retention and termination | | | | Greensboro, NCFletcher, C. (1992), |
| decisions; and means of managerial control | | | | "Performance management: its nature and |
| (Fletcher, 1992). In order to take full | | | | research base", in Developing a |
| advantage of the performance appraisals, the | | | | Performance-oriented Culture (Eds), |
| goal in designing such systems should be | | | | Association for Management Education and |
| congruent to the overall aim and vision of | | | | DevelopmentPollitt, D. (2004), "Nokia |
| the company. For instance, it is evident that | | | | Connects HR Policy with Company Success", |
| there is a direct correlation between the | | | | Human Resource Management International |
| performance of employees and their rewards as | | | | Digest, Vol. 12 No. 6, p30-32Papers For You |
| businesses do seek creation of wealth as | | | | (2006) "P/HR/244. Performance appraisal and |
| their primary goal. Therefore one of the | | | | 360 degree assessment", Available from For |
| increasingly adopted uses of performance | | | | You (2006) P/HR/208. Performance appraisal |
| appraisals is to motivate employees to | | | | and employee feedback", Available from [21/06 |
| perform better by linking it with reward | | | | 2006]Copyright 2006 Verena Veneeva. |
| packages.The concept and its uses can be | | | | |