HRM Discussion: Performance Appraisal and Compensation Strategies

This report delves into the critical aspects of Human Resource Management (HRM), focusing on performance appraisal and compensation strategies. The first part explores the significance of performance appraisal, highlighting its role in assessing employee potential, providing incentives, and fostering transparency. It also examines the benefits of performance appraisal, such as its ability to identify top performers and align employee actions with organizational goals. The second part of the report shifts the focus to compensation, emphasizing the need for large companies to adjust their compensation packages to local economic conditions. The report underscores the impact of compensation on employee motivation and the overall business strategy. It also highlights the importance of fair competition and transparency in the business world, concluding that well-designed compensation packages benefit both the company and its employees.

RUNNING HEAD: HRM DISCUSSION
HRM DISCUSSION
Discussion 7 & 8

HRM DISCUSSION 2
Part 1
Performance appraisal is one of the systematic approaches that is used for the purpose of
evaluation. As in the organization, employees are evaluated using this approach in the context of
their potential being shown in the work. There are various measures on which the performance
can be measured such as job knowledge, quality and quantity of the work being done, leadership
and motivation qualities, supervision, coordination or cooperation and so on. (Naji, A.,
Mansour,2015)
So, consistent with many of the benefits, it is being advisable for the organizations to use this
method and some of the benefits are as follows:
 It is one of the best ways to make certain aptitude according to the performance of
employees.
 This method helps in providing the accurate incentive for the employee who is working
well in an organization.( Anitha, J., & Saranya, S,2014)
 Performance appraisal method works as an indicator of motivation for both performing
and nonperforming employees.
 This method is best for keeping the transparency between the employees, as more work
will lead to the higher pay or the higher incentive.
 It mainly helps in the evaluation of the employees that have the potential of increasing
the profits. As all the organizations are future-oriented with the perspective of earning
profits. (Idowu, A,2017)

HRM DISCUSSION 3
Part 2
Large companies with the high profits should redecorate their packages of reimbursement for the
superior adaptability to the local economy. The compensation packages that are being designed
are not only based on the local economy benefit for the economy and the employee but these
packages will prove to be beneficial for the company as well as the economy and the employee.
(Dee, T. S,2015)
Some of the major corporations should take the time for analyzing the influence of locally owned
business on the area economy i.e. prior to preceding forcefully themselves into the market.
Moreover, it has been also analyzed that the move-in of a big corporation could be the reason for
the small business owner that has been forced out of the business.
In the last, conclusion that can be made is that competition is always a one of the factors in the
business that is learned to play fairly and have transparency in it. So, these compensation
packages are not only benefitted for an economy and the employee but these packages will prove
to be beneficial for the company as well. (Eccles, R. G,2014)

HRM DISCUSSION 4
References
Naji, A., Mansour, J., & Leclerc, A. (2015). Performance Appraisal System and Employee
Satisfaction: The role of trust towards supervisors''Journal of Human Resources Management
and Labor Studies June 2015.
Anitha, J., & Saranya, S. (2014). Impact of Supervisor Style on Effectiveness of Performance
Appraisal System. ASBM Journal of Management, 7(2), 39.
Idowu, A. (2017). The effectiveness of Performance Appraisal System and its Effect on
Employee Motivation. Nile Journal of Business and Economics, 3(5), 15-39.
Dee, T. S., & Wyckoff, J. (2015). Incentives, selection, and teacher performance: Evidence from
IMPACT. Journal of Policy Analysis and Management, 34(2), 267-297.
Eccles, R. G., Ioannou, I., & Serafeim, G. (2014). The impact of corporate sustainability on
organizational processes and performance. Management Science, 60(11), 2835-2857.