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Existing Practices of Performance Appraisal in Modern Firms - Research Proposal Example

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Over the time of an individual’s employment, the organization reviews his performance and offers reward and penalization accordingly. The performance appraisal is a…
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Existing Practices of Performance Appraisal in Modern Firms
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Research Proposal: Performance Appraisal Table of Contents 0 Introduction 3 2.0 Background 3 3.0 Rationale of the Study 4 4.0 Problem ment 4 5.0 Research Questions 5 6.0 Research Objectives 5 7.0 Literature Review 5 8.0 Research Methodology 9 8.1 Research Design 9 8.2 Data Collection 10 8.3 Ethical and reliability issues involved 10 9.0 Time Plan 11 Reference List 12 1.0 Introduction Performance appraisal is defined by the process of continually evaluating the performance of the employees. Over the time of an individual’s employment, the organization reviews his performance and offers reward and penalization accordingly. The performance appraisal is a vital part of performance management of an organization. The performance appraisal allows the firm to develop a proper communication with the employees in a formal manner. This creates an insight among the employees about how the organization is concerned about it employees’ performance. The communication also allows the employees to provide feedback which can be used by the higher management to make necessary amendments in the organizational structure and activities. Moreover, assessing the performance levels of individual employees also allow the managers to evaluate the overall performance of the organization. Therefore, implementing an effective performance appraisal is necessary for ensuring the organizational success and sustainability. However, performance appraisals can also bring several issues to the organization. This can result in poor implementation of the appraisal system, misuse of the appraisal system and failure to link the desired organizational output with the appraisal results. This research proposal is focused on the problems faced by the modern organizations in performance appraisal. It covers the clear description of the research aims and objectives along with literature review of the previous works. It also covers the research methodologies including data collection and analytical procedures. 2.0 Background The globalization of market economy and the modernization of information technology have intensified the competitiveness in the global market environment. Modern firms are constantly looking out for new ways to increase their performance and productivity level along with seeking out for ways to reduce costs. This as a result has allowed the firms to implement effective performance appraisal system in order to achieve higher performance enhancement thereby giving the firms a higher competitive advantage. In order to create new ways to achieve a strengthened market position, the firms often seek out for new ways to increase their resource efficiency. Therefore a robust performance appraisal program is imperative for the firms’ pursuit of increasing its productivity. Thus performance appraisal is an integral part of performance management of an organization. In the current business scenario the rapid development of various enterprise and institutions has lead to rise of several problems in the human resource department of a firm regarding the performance appraisal of an employee. These issues are relatively concentrated and often become complicated as several obstacles come in to surface while implementing the appraisal system. 3.0 Rationale of the Study In order to improve the organizational performance of a firm it first needs to find out the current performance status of the employees. Thus performance appraisal acts as an effective and formal method of assessing the performance level of the individual employees. The research paper will act as guidance to modern and upcoming managers by giving the proper insight about the positive impacts of well implemented performance appraisal system. Moreover, it also highlights the issues faced by the firm and how they have chose to solve them. This paper will also help other researchers to have clarity about the previously used appraisal system and how they have evolved over the years. It will act as a recommendation guideline by highlighting the possible loop holes of commonly used appraisal system and how they can be avoided to achieve a more efficient performance management system, thereby ensure growth and future sustainability. 4.0 Problem Statement Although performance appraisal is supposed to act as a tool to help an organization improve its performance but at often times they do not yield the desired result. The firms mostly fail to implement the appraisal system like the way they want, mostly because of several internal and external interventions. This research work will try and find out the necessary activities required to successfully incorporate an appraisal system in the overall performance management of the firm. Moreover, an appraisal system often becomes a tool for exploitation or misuse by the higher management, which in turn leads to a gradual degradation of the organizational behaviour thereby decreasing the employees’ motivation level resulting in overall performance deterioration of organizational performance. 5.0 Research Questions What are the existing practices of performance appraisal in modern firms? How the firms are successfully implementing their proposed appraisal system? What are the problems faced by the organizations while implementing the performance appraisal system? What are the possible recommendations for the firms so that they can improve their performance management? 6.0 Research Objectives To study the features of modern enterprise and its human resource management. To identify the relationship of modern human resource management and performance appraisal. To assess the organizational practices regarding performance appraisal. To identify the problems with performance appraisal in modern enterprises? To find out the recommendation in order to successfully improve the performance management of the firms. 7.0 Literature Review According to Wiese and Buckley (1998) the concept of performance appraisal has evolved over the years to provide more clarity to the assessment of the employees’ performances. Performance appraisal system has although has existed for more than a thousand years, has become more formalized over time. The main reason behind this is the organizational necessity of performance and efficiency improvement. Gradually performance appraisal became an integral part of the organizational activities as improving the organizational performance became imperative with the rapid growth of the market competition. Bellows and Estep (1954) mentioned that formalization of performance appraisal initiated in US, when an army supervisor in 1813 felt the need of assessing individual performance of his men. This was followed by offering efficiency rating to the soldiers based on their field performance. This as a result allowed the supervisors to identify the room for further development, thereby enabling them to effectively improve their performance. The practice of this concept eventually spread to organizational practices where the higher management started using numeric scoring system to measure the past actions and efficiency level of the employees (DeVries et al, 1981). This method was eventually over shadowed by more flexible approach, as it did not provide any judgmental assistance to the managers. The identification of existing loop holes in the proposed appraisal system led to the rise of system based appraisal methods. This as a result allowed the managers to have a more clear and accurate data of the employees’ activities and allowed them to make easy judgments regarding promotions and demotions based on predefined benchmarks. Cascio (1991) pointed out that the commonly used performance appraisal tool which used rating system and graphic scales, are often questioned regarding its reliability. On the other hand the psychometric approach which assessed an individual’s mental approach towards his work was not as popular among the traditional managers as it did not produce and qualitative results. in order to get over this issue, Smith and Kendall (1963) developed an new rating system called Behaviourally Anchored Rating Scales (BARS). This performance appraisal system allowed the managers to clearly define the performance dimensions of the employees based on more observable activities and behaviours. BARS eventually proved to be more accurate that the previously used rating systems. Over the year, the performance management system has evolved to find out new ways to monitor performance patterns and ways to improve them to achieve high efficiency and organizational sustainability. Now-a-days the performance appraisal methodologies serve multiple organizational objectives at the same time, like carrying performance reviews to the higher authority, enabling a seamless feedback mechanism, identifying new niches of improvement and creating a close communication between the employer and its employees (Wiese and Buckley, 1998). Banner and Graber (1985) has pointed out that the effectiveness of the existing practices is only relevant on paper. They do not prove to be as effective in the real life practices. He pointed out that appraisal practices faced several problems like issues with measuring the employee effectiveness, due to the lack of clear definition of the term ‘effectiveness’. The role of measurement was also ambiguous as there was no clear relationship with the human resource management activities. Davis (2011) stated that performance appraisal system is imperative to developing and strong, efficient and motivated workforce in an organization. On the context of the modern organizational practices he successfully pointed out the seven issues faced by firms while implementing a successful appraisal system. These are direct biasness, indirect biasness, existing competencies, devolution, authoritarianism, informal or incidental appraising and information collection. The direct biasness suggests that all individuals are biased to some level; this as a result creates discrepancies in performance measurement. The individual belief system and cultural background of the person playing the role of judge often intervenes with proper judgment thereby creating a major loop hole for in the appraisal system. The indirect biasness is more organizational behaviour oriented rather than being individualistic. As a result the managers often tend to make their judgements based on an employees’ compliance with the organizational environment. Competency suggests that every organization train only the higher management personnel on how to implement performance appraisal. This as a result creates inconsistency among the lower level managers and supervisors thus leading to lack of standardization within the organizational practices. Devolution is centred on the development of the appraisal system. In most cases the appraisal system is devised by the human department of the organization, which often becomes the subject of complaint for the line managers, who feel that they are being left out in the decision making process. Authoritarianism suggests that there exists a significant imbalance in power when it comes to decision making in an appraisal meeting. The top management often dominates the decision making process, which threatens the subordinates. The informal or incidental appraising is the issue with over formalization of the appraisal system. Mostly the performance assessments are done on a yearly, and as a result most of the smaller issues go unnoticed and escalates to a bigger issue. Information collection suggests that often information collection tools are exploited and misused. Some of the higher management individuals take advantage of their access to the employee information database and selectively choose data to make a fabricated judgement. May and Gueldenzoph (2006) suggested that all the inherent problems can be solved or at least put to check by employing certain strategic measures. The appraisal training should be disseminated in a holistic manner, so that all the individuals regardless of their hierarchical position are well aware of the appraisal procedure. The managers are needed to be made aware of the possible biasness that can arise in the appraisal process, so that they can be effectively avoided. The environmental factors needs to be controlled and the managers must ensure that it does not influence the judgement process. The designing of the appraisal system needs to be done by involving all the departments of the firm so that all employees can give their input in the devising of the appraisal system. This as a result will create a performance appraisal system which will be widely accepted in the organization. The importance of the feedback mechanism plays a vital role in the organizational development. It allows the lower level personnel to communicate their issues to the higher management so that they can be addressed easily at a faster pace. Wilson and Western (2000) opined that training and development is an integral part of an effective appraisal system. The primary reason of the failure of previously implemented appraisal system is that the performance assessment was not followed by training and skills improvement programs for the employees. Mere assessment is futile if the organization cannot improve the existing human capital. In order to bridge this gap, training and development programs were implemented based on the appraisal results. Gruenfeld (2009) contrasted that incorporating training and development programs in the performance appraisal system will eventually lead to loss of organizational time. Implementing training programs every year may result in improved effectiveness, but this is not a viable option for all types of firms. In firms where, the employees are faced with steep targets and steep deadlines, engaging in training sessions will cause loss of man hours for the firm, thereby reducing the short term revenues. Piggot-Irvine (2003) has pointed out that the effectiveness of the performance appraisal system is dependent on how the appraisal system has been devised and implemented. Developing an effective appraisal system should begin with an initial meeting where all the employees’ inputs are taken and aspects like performance expectation, professional standards, action plans, etc are confirmed. These are the set benchmarks against which the performances will be measured. The action plans are then needed to be authorised by the higher level management. This step should be followed by the collection of performance data about the performances of the employees. The data collection needs to be done based on commonly agreed procedures which allow the managers to avoid biasness. Moreover the collecting information needs to be done in a systematic way by using performance measurement tools. This as a result will help to stop any fabrication of data. A second interview is needed in order to review the achievement of the system and incorporate any changes if required. After it is confirmed that all the activities are progressing as desired then the data collection process is further continued. This should be followed by self appraisal, where the employees can perform a self assessment before the appraisal interview. The appraisal interview is the final meeting between the employees and their manager, where the manager states their judgement regarding the performance of the individual supported by sufficient evidences thereby deciding on his promotion, rewards or demotion or penalty. Cardy and Dobbins (2008) highlighted that the efficiency of performance appraisal system is based on transparency, confidentiality and trust. In order for the appraisal system to help the organization to improve its performance, the system needs to be kept from any biased influences. This can be achieved by keeping it separate from the organizational disciplinary aspects. The trust between the employees and their employer also plays an important role in guidance providing and increasing the motivational level of the employees. The performance appraisal system can only provide accurate results if it is approached with clear guidelines, objectives thereby improving the overall performance of the firm. 8.0 Research Methodology The research methodology provides a complete overview of the research procedure and how the research work will proceed. It involves the processes of data collection procedures, choice of data source, use of analytical tools, etc. The research methodology will give the reader a clear insight about how the research questions will be approached and how the research objectives will be met (Saunders, Lewis and Thornhill, 2009). 8.1 Research Design The research design is focused on the several ways in which the research questions will be answered (Bryman and Bell, 2011). It also includes the data source from where the relevant information will be collected for the research work. This research work will be pursued using both secondary and primary data. The researcher will ensure that the data collection is based on the primary objectives of the research. This as a result will lead to finding relevant data required to answer the research questions. The secondary data will be acquired from several journal articles and reputed books on the subject of performance appraisals. The books will help to form a theoretical background on which the study will be conducted; this will ensure that all work has not deviated from the desired path. Moreover, the journal articles will provide several case studies and recent findings which will allow the researcher to get a clear insight about the previous works in this field, thereby providing the new opportunities to exploit. The primary data will be collected from one hundred respondents belonging to several organizations. This data will help to achieve a more convincing approach towards the research objectives. The primary data will provide a strong ground over which the proposed statements can be justified. 8.2 Data Collection The data collection acts as the basic foundation of a research work. The success of the research work is mostly dependent on the data collection procedure. Collecting data can be done by employing several methods. The choice of data collection procedure mostly depends on the type of data required (Bryman and Bell, 2011). The secondary data will be collected from several journal databases and relevant websites and books collected from the university library. The researcher will ensure that collected data are authentic and are not older than seven years. This as a result will increase the relevancy of the collected data against the current business environment. The primary data will be collected via online questionnaire distributed through email and social network. This will help the researcher quickly collect the required data. The researcher will ensure that the respondents belong to a heterogeneous group with different professional background, so that the collected data can shed light to different sectors of the global business market. The questionnaire will collect data regarding appraisal practices of the respondents’ firm and if has been able to implement it successfully. 8.3 Ethical and reliability issues involved The researcher will conduct the study by following the predefined regulations set by the university. He will also ensure that the collected information from the primary sources is only for study purposes and that they not misused in any way. The primary data collection always comes with certain short comings, like the respondents can be hesitant to disclose sensitive information regarding his organizational practices (Hair and Money, 2011). In such cases the researcher will respect his voluntary response. The secondary data can be questioned regarding its reliability and authenticity. The researcher will ensure that the secondary data are collected from reliable sources like article published in reputed journals and websites good reputation of assurance of good quality content. Thus researcher will ensure that the research work has been completed by maintaining all the necessary ethical practices and taking care of the reliability issues so that the quality of the work can be increased (Saunders, Lewis and Thornhill, 2009). 9.0 Time Plan Figure 1: Time Plan for Research Work tasks 1st week 2nd week 3rd week 4th week 5th week 6th week Topic Selection Collecting secondary data Creating research plan and selecting research methodologies Collecting primary data Analysis and Findings Conclusion Submitting draft Final submission Source: (Created by Author) Reference List Banner, D.K and Graber, J.M., 1985. Critical Issues in Performance Appraisal. Journal of Management Development, 4(1) pp. 26 – 35 Davis, P.J., 2011. Seven biggest problems with performance appraisals: and seven development approaches to rectify them. Development and Learning in Organizations: An International Journal, 26(1) pp. 11 – 14 Bellows, R.M. and Estep, M.F., 1954. Employment Psychology: The Interview, New York: Rinehart. Bryman, A. and Bell, E., 2011. Business Research Methodology. 3rd ed. New York: Oxford University Press. Cardy, R. and Dobbins, G., 2008. Performance appraisal: alternative perspectives. 3rd ed. London: Harvester Wheatsheaf Cascio, W.F., 1991. Applied Psychology In Personnel Management. New Jersey: Prentice-Hall. DeVries, D.L., Morrison, A.M., Shullman, S.L. and Gerlach, M.L., 1981. Performance Appraisal on The Line. Greensboro: Center for Creative Leadership. Gruenfeld, E, F., 2009. Performance appraisal, promise and peril. 5th ed. New York: Springer Verlag. Hair, J. F. and Money, A. H., 2011. Essentials of Business Research Methods, 2nd ed. New York: M. E. Sharpe. Inc. May, G. and Gueldenzoph, L., 2006. ‘The effect of social style on peer evaluation ratings in project teams. Journal of Business Communication, 43 (1), pp. 4-20. Piggot-Irvine, E., 2003. Key features of appraisal effectiveness. International Journal of Educational Management, 17(4) pp. 170 – 178. Saunders, M., Lewis, P. and Thornhill, A. 2009. Research methods for business students. 5/e. Pearson Professional Limited. London. Smith, P.C. and Kendall, L.M., 1963. Retranslation of expectations: an approach to the construction of unambiguous anchors for rating scales. Journal of Applied Psychology, 47, pp. 149-55. Wiese, D.S. and Buckley, M.R., 1998. The evolution of the performance appraisal process", Journal of Management History, 4(3) pp. 233 – 249 Wilson, J.P. and Western, S., 2000. Performance appraisal: an obstacle to training and development?, Journal of European Industrial Training, 24 (7) pp. 384 - 391 Read More
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