Globalization of Performance Appraisals

Introduction

Globalization has become the mainstream for many industries and with it comes the difficulties associated with social, political, environmental and cultural consequences. The purpose of this article is to help identify, through a review of literature, the "best practices" in performance appraisals within a globalized or multi-national corporation (MNC). In general, performance appraisals in MNC's are not unlike performance appraisals in any other organization. The area where the authors have chosen to focus, however, is on upper management levels where it is not uncommon for a manager to have employees scattered throughout the world. This distant relationship adds other challenges for both the appraiser and the appraisee. These challenges may in some cases be similar to those experienced by matrix organizations where an employee does not report to his/her direct superior on a day to day basis, but rather to the business unit where they are located and supplying their services.

The article will be broken into five sections. The first section will look at some of the reasons for globalization of organizations, the strategies and structures needed to operate on a global basis, and some of the challenges faced by Human Resources (HR) in a globalized environment. The next section will look at performance appraisals and will highlight the different methods currently in use, some of the common pitfalls, positive and negative outcomes and, finally, elements that can be implemented in order to improve on current practices. The third section will discuss performance appraisals in a global setting and what systems prove to be most effective and which do not. This will be accomplished through discussion of the challenges, trust and relationship requirements, cultural differences and the types of appraisal systems best suited for this environment. Next, the researchers will compare the results from the review of literature to two companies in the health care industry, MDS Pharma Services (Contract Research Organization) and Pfizer (Biopharmaceutical). In order to make the comparison, a small questionnaire consisting of six questions was constructed and sent to managers meeting the criteria of having "distant" employees. The questions were open ended in order to allow for a variety of responses enabling the researchers to view trends and make comparisons to literature. Finally, the authors will offer recommendations for performance appraisals in the global environment.

Trends and reasons for globalization structures and strategies

The availability of foreign products and services in many countries of the world has dramatically increased since the 1990s and it is not uncommon to see stores such as a Carrefour in competition with superstores such as Wal-Mart ([13] Hammond and Grosse, 2003). An explanation for this might be found in the