Literature Review - Coursework Example

The current study aims to examine and evaluate various practices and policies on performance appraisal systems and procedures as revealed by diverse authors whose researches have been published in peer reviewed academic journals. This literature review hereby aims to proffer relevant issues that emerge in the subject of performance appraisal. The determination of organizational effectiveness which is the degree to which objectives of an organization are achieved is a cardinal task of management.

The contribution of each employee in attaining these objectives is the extent to which one has achieved. Therefore, performance evaluation is the assessment of achievement of objectives. Longenecker and Nykodym (1996) examined the potential benefits of performance appraisals and revealed that the appraisal process serves as a communication tool, a means to increase motivation and productivity, an arena for discussion of future career prospects for growth and development, as a basis for wage administration, and as a framework for decision making process relative to human resources concerns.

Brown, Hyatt and Benson (2010) likewise validated the ability of performance appraisals in increasing employee performance and productivity through “greater employee identification with the commitment to objectives of the organization (Brown, et.al, 2010, 377); financial incentives which are contingent on performance (ibid, 378) and through encouragement of retention. Likewise, Eremin, Wolf and Woodard (2010) acknowledged the critical role of performance appraisals in merit based pay system.

While eminent advantages are presumed to be realized from performance appraisal systems, some research have divulged the presence of biases due to various factors, to wit: favoritism and politics (Heneman, 2003) and issue of fairness and equity, lack of trust in management, and lack of resources or money for rewards (Eremin, et.al, 2010). On the other hand, supervisors expressed difficulties in handling poor performers as revealed from appraisal reports due to the need to exercise objectivity in identifying performance problems (Daley, 2008).

Management support was likewise another factor stated by Daley (2008) as precluding plans for performance improvement. Further, the time consumed to address performance problems tend to neglect other pressing responsibilities. The need for performance appraisals and evaluation, despite issues of biases and difficulties in application and in addressing poor performers, was deemed relevant and worthy by both managers and employees (Longenecker & Nykodym, 1996). The challenging issues that face organizations is designing an appropriate and effective performance appraisal system free from biases and serves clearly identified goals.

Brown (et.al, 2010) is a function of both performance appraisal procedures and treatment focusing on four indicators: clarity of role and purpose, extent of communication and flow of information, level of trust the employee has for their supervisor, and fairness throughout the process. As suggested by Eremin (et.al, 2010), biases could be addressed through a closer evaluation of current performance evaluation systems and by increasing the training of evaluators. Longenecker & Nykodym (1996) presented both managers’ views and subordinates’