Globalization of performance appraisals: theory and applications

Purpose – The purpose of this article is to provide a more complete perspective regarding the “best practices” for performance appraisals of “distant” employees in global organizations. Design/methodology/approach – A range of published works (1998‐2009) on multinational corporations and performance appraisals was reviewed. The literature was used to determine human resource challenges associated with globalization as well as the types of performance appraisals, common pitfalls and elements for improvement of appraisal systems. Concepts were then combined to determine the “best practices” for performance appraisal in a global setting. Finally, a small questionnaire consisting of six questions was constructed and sent to managers in two companies in the health care industry 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 with the literature. Findings – Adequate training must be provided to both the appraiser and the appraisee in order to avoid the many rating errors that are common in performance appraisal. Training should include cultural, legal and customer differences by country providing managers with the tools to improve on the process. Managers must also be given the opportunity to build the required relationship with these employees. Research limitations/implications – A questionnaire was sent to several key managers in two complex pharmaceutical firms meeting the criteria with responses received. Further empirical research on the best practices of performance appraisal for distant employees in global organizations should be pursued. Practical implications – This article provides a source of information on what practices are followed in order to support the performance appraisal of “distant” employees in different parts of the world. Originality/value – There is limited literature dealing with “distant” employee performance appraisal in global organizations and this article attempts to fill this gap.