Project Report International Performance Appraisal & Management Performance appraisal is an analysis of an employee's recent successes and failures, personal strengths and weaknesses, and suitability for promotion or further training.
Prepared by: MOAZZAM QUDDUSI
PROJECT REPORT ON
International performance Appraisal & Management A topic of IHRM
Submitted to:
Report on IHRM
Submitted by:
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Prof. Neha Gupta Mam
Moazzam
IIPM DEHRADUN
SS/Batch/09/1
INDEX S.NO
TOPIC
PAGE NO.
1
ACKNOWLEDGEMENT
4
2
ABSTRACT
5
3
LITERATURE
6
y
IHRM
y
PE RFORMANC E APPRAISAL
y
PROC E SS
y
PE RFORMANC E MANAG E ME NT
y
PERFORMANCE APPRAISALS IN AN INTERNATIONAL
TO 18
CONTEXT o
MULTINATIONAL
PE RFORMANC E
MANAG E ME NT
4
o
EXPE TRIAT E PE RFORMANC E MANAGE ME NT
o
PE RFORMANC E APPRAISAL FOR
o
INDIVIDUAL PE RFORMANC E & APPRAISAL
o
INT ER NATIONAL COM PE SATION
o
CHALLE NG E S
o
P C N ROL E CONC EP TION
o
T C N ROL CONC EPTION
BIBILOGRAPHY
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HC N
18
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ACKNOWLEDGEMENT
I am highly gr ateful to Prof. Neha Gupta Mam who has provided me a splendid opportunity to be a part of this Project Report & shared her precious time and knowledge with me. It has been a marvellous learning experience; also it has prepared me for the corporate world. I must also thank IIPM Dehradun, to give me a platform where I enhanced my knowledge.
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Abstract Difficulties in executing performance appraisals are widely reported. However, little is known about the conduct of performance appraisals for host country managers. These managers are usually isolated from their supervisors, and it could, therefore, be expected that they would also experience difficulties in the conduct of their performance appraisal. This paper examines the extent, nature and limitations of performance appraisals for host country managers in a sector of the healthcare industry in Australia. The study found performance appraisals are widely used, but in most cases are done poorly. In over 80 per cent of cases the appraisals were perceived as ineffective, which is higher than world wide reactions to appraisal. The performance appraisal proce ss was found to be influenced by the emphasis given to the bottom line, the relationship with the supervisor and the effect of the multinational's parent strategy, structure and nationality. The findings suggest that the host country manager's experience of the appraisal often results in the manager perceiving limited opportunities for career development and advancement in the company. This may impact on the overall long term performance of the subsidiary. It is recommended that some straightforward modifications to the appraisal could make a significant contribution to both the retention and development of these managers, and, therefore, to company performance. Performance management and particularly PA is a strategic human resource management (HRM) process. These mechanisms enable the MNC to continuously evaluate and improve individual, subsidiary unit and corporate performance against clearly defined, preset objectives that are directly linked to company strategy (Dowling, Welch & Schuler 1999). Thus, an effective PA creates a mechanism that can ensure the HCM and their overseas subsidiaries are acting in accordance with the parent MNC's interests. While there is wide recognition of the importance of PAs, most MNCs have not effectively managed their international appraisals. It has been argued that mismanagement of international PAs is primarily due to information asymmetry and goal incongruence between the parent company and its subsidiaries.
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IHRM IHRM is a rapidly expanding sub-field within the academic study of human resource management . Its focus is the management of employees in multinational corporations and traditionally was concerned primarily with the issue of expatriation ; that is, the management of parent-country nationals who were sent to work in overseas subsidiaries. However, in recent years, the scope of IHRM has expanded considerably and researchers consider all aspects of HRM within large, international companies, including international recruitment and selection, international reward, training and development programmes, and systems of performance management.
Performance appraisal A
performance appraisal, employee
appraisal, performance review, or (career)
development discussion is a method by which the job performance of an employee is evaluated (generally in terms of quality, quantity, cost, and time) typically by the [2]
corresponding manager or supervisor . A performance appraisal is a part of guiding and managing career development. It is the process of obtaining, analyzing, and recording information about the relative worth of an employee to the organization. Performance appraisal is an analysis of an employee's recent successes and failures, personal strengths and weaknesses, and suitability for promotion or further training. It is also the judgement of an employee's performance in a job based on considerations other than productivity alone.
Performance Management is a means of getting better results from the organizations, teams and individuals within an agreed fr amework o f planned goals, objectives and standards. -ARMSTRONG AND MURLIS Why Appraise Performance? Periodic evaluation helps mangers to have a better understanding of each employee's skills with the goal to f acilitate, train and develop abilities and power to their employees. A chase to assess job development, encourage interest and enhance job o performance by pointing out the development and recognizing productive work A feedback system that might otherwise be overlooked o
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Process
Performance Management Performance management includes activities to ensure that goals are consistently being met in an effective and efficient manner. Performance management can focus on the performance of an organization, a department, employee, or even the processes to build a product or service, as well as many other areas.
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Ba
C o
pon n
o Perf orman e Managemen
Multinationals
global strategies and goals
Subsidiary goals
Job analysis
Individual e
loyee
(PCN, TCN, HCN) job
Performance appraisal
goals and standards
Training
R
rt
I R
P
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PERFORMANCE APPRAISALS IN AN INTERNATIONAL CONTEXT Multinational Performance Management While its general strategic position may be international, multinational, global or transnational, a multinational makes strategic choices based on economic and political imperatives. Within this context, as indicated in figure, the multinational has speci fic expectations for each of its foreign subsidiaries, in terms of market performance and contribution to total profits and competitiveness. When evaluating subsidiary performance against these expectations, however, it is important to recognize various constraints that may affect goal attainment. These include the following.
Various Constraints Whole v ersus part: The balance sheet of this particular subsidiary might be continually in
the red, but this strategy, by tying up the competitors resources, may allow higher returns in another market. N on-com par able dat a: Frequently, the data obtained from subsidiaries may be neither
interpretable not reliable, as the following examples illustrate: Example1: Sales in Brazil may be skyrocketing, but there are reports that the Brazilian government may impose tough new exchange controls within a year, thus making it impossible for the multinational to repatriate profits.Does this mean that the MNE is performing effectively? Is the subsidiary performing effectively? Example2: Sales in Perumay be booming, but headquarters management was unaware that under Peruvian accounting rules, sales on consignment are counted as firm sales. How should the headquarters accounting system handle these sales relative to sales from other subsidiaries, with do not consider sales on consignments as firm sales? Physical measures of performance may be easier to interpretthan in these examples, but difficulties may still arise. V ol atility of global env ironment: The turbulence of the global environment requires that
long-term goals be flexible in order to respond to potential market contingencies. Accordi ng to Pucik, an inflexible approach may mean that subsidiaries could be pursuing strategies that no longer fit the new environment. Se par ation by time and d ist ance: Judgments concerning the congruence between the
multinational and local subsidiary activities are further complicated by the physical distance involved, time-zone difference, and the frequency of contract between the corporate head office staff and subsidiary managem ent and the cost of the reporting system. Vari able lev els of maturity: According to Pucik, w ithout the supporting infrastructure of the
parent, market development in foreign subsidiaries is generally slower and more difficult to Report on IHRM
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ac ieve
than
at
h om e,
where established brands can support new products and new
busin ess areas can be cross-subsidized by other division. In summary,
there
are a number of significant constraints
that
must be consid ered when
appraising th e performance of a for eign subsidiary. Because this appraisal is primarily based on strategic factors, it aff ects
the
appraisal and success of the subsidiarys chief e ecutive
most directly. Contr ol
and Perf ormanc e Management:Although it is not of ten described as such,
performance management is a part of a multina tionals control system. It will be recalled from
th e
discussion of control mechanisms
th at
performance targets were listed as par t of
formal control. Through formal con trol mechanisms and communication f eedba c
throu gh the
and appraisal aspects, performan ce management also contributes to shaping
corporate culture, both formally and informally,
th ereby
acting as an informal control
mechanism as well as par t of the bureaucratic control system.
Desi
R
rt
np o
I R
ess
fo
exp
t i te performan
e
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PERFORMANCE APPRAISAL OF HCN EMPLOYEES
Parent Company
Communicates Role Conception
Cultural Boundary: HCN Managers Role recipient HC Stakeholders Role Senders HCN Managers Role Behavior
THEORIES G regerson and Black Feldman and Tompson
Factors Affecting Commitment: Role conflict and autonomy Lack of discretion Role expectations Rationale behind using TCNs Expatriates appraisal Similarity of jobs
HEADQUARTERS SUPPORT Removal from the comfort zone Primary motivation Support important
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HOST ENVIRONMENT Environmental impact. Performance depends on various demands.
CULTURAL ADJUSTMENTS Critical determinant Difficulty in adjusting(expatriate and family) Individuals vary in terms of reaction and coping. Conscious and responsive
A contextual model of expatriate performance Management.
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Who are Non-Expatriates? Non expatriates are employees whose work involved international travel butare not considered internationalassignees.
Non-Expatriate PerformanceManagement Effects of factors associated with constant air trav el, e.g. Depression, anxiety, sleep disturbance, health Stress associated with frequent absences and effect on family relationships Non-standard assignments share these aspects, e.g. Commuter arrangements Virtual assignments
Individual Performance and Appraisal Factors to be considered in the Individual Performance and Appraisal process: y y y y y y
Expatriate Performance Management System Compensation Package Task Headquarters Support Host Environment Cultural Adjustment
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International Compensation Key components of an International Compensation Program y
y
y
Base
Salary An expatriates base salary is normally in the same range as the base salary for a similar position in the home country. Foreign Service Inducement/Hardship Premium A Foreign Service premium is extra pay the expatriate receives for working outside his or her country of origin it is offered as an inducement to accept foreign postings Allowances Hardship allowances o Payments to compensate expatriates for exceptionally hard living and o working conditions at certain foreign locations.
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Housing allowances Cost-of-living allowances o Education allowances o Relocation allowances o Parent country wages everywhere o Wean expatriates from allowances o o Pay based on local or regional markets Cafeteria selection of allowances o Global pay systems o Benefits Many firms also ensure that their expatriates receive the same level of medical and pension benefits abroad that they received at home Tax differentials o
y
y
COMPENSATION PACKAGE
It is essential that we recognize the important of remuneration and reward in the performance equation. Perceived financial benefits, along with the career progression potential associated with an overseas assignment, are often important motives for accepting the posting, It these expectations are not realized during the assignment, the level of motivation and commitment is likely to decrease, thus affecting performance.
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Expatriate Performance Appraisal: Challenges y y y y y y
y y
Fit of international operation in multinational strategy Unreliable date Complex and volatile environments Time difference and distance separation Local cultural situation In most cases, two groups evaluate the performance of expatriate managers host nation managers and home office managers - and both are subject to unintentional bias Home country managers tend to rely on hard data when evaluating expatriates Host country managers can be biased towards their own frame of
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PCN role conception
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TCN role conception
Bibliography
IHRM by: www.wikipedia.com www.hrnotes.com www.scribd.com
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