Importance of Performance Measurement and Performance Appraisal in Human Resource Development

How Performance Appraisal Contributed to the Development of Human Resources is a burning issue in the field of HR management. Performance measurement or appraisal is a core function of human resource management and has remained an imperative area of research among organizational researchers (Dulebohn and Ferris, 1999). Elmuti et al. (1992) argue that performance appraisals are used typically in organizations for two broad purposes: as an evaluative function for making decisions regarding merit pay, promotions, demotions, transfers, and retention and/or as developmental function to identify areas for employee growth and improvement and recommending ways of improving performance or the potential for performance. An effective performance appraisal enhances employees’ perceptions and understanding of job tasks and results in job satisfaction (Shen, 2004). It leads managerial career development, career progression and compensation adjustments (Schuler et al., 2002). First objective of the appraisal mechanism is to develop and build the capacity of employees by providing them formal feedback on job performance (Shen, 2004). Furthermore, performance appraisal is an instrumental tool to influence both the extrinsic and intrinsic motivations of employees and their attitudes towards organizations (Shen, 2004). Continue reading


Human Resource Management & Strategic Human Resource Management (HRM vs. SHRM)


Recruiting and selecting is the most important function in Human Resource Management and hiring the right person is very crucial for an organization to be succeeded as Collins (2001:13) points out that

People are not your most important asset. The right people are.

The dynamic fast paced competitive business environment requires organizations to recruit skilled and knowledgeable people who can help the businesses sustain in the long run. Bratton and Gold (2007) specified HRM as a means of achieving organizational effectiveness through deploying employees’ talent by the use of idiosyncratic HR programs and practices. Human resource management is the process that helps organizations get competitive edge over other competitors by recruiting and retaining the Continue reading

Reasons and Benefits for Incorporating Knowledge Management (KM) as a Change Strategy

The indispensability for organizational change is to direct the organization in a path where it can learn and use its capabilities to meet the expectations of its customers and other stakeholders (Moran and Brightman, 2001). It is implied that how effectively the organization is able to learn and exert knowledge in different states ensures the effectiveness of the organization (Laudon and Laudon, 2000). A number of forces are responsible for organizations to adopt Knowledge Management as a change strategy. Continue reading

Benefits of Incorporating Corporate Social Responsibility (CSR) in Business Organizations

One of the most prominent, widely discussed issues of today’s business management is Corporate Social Responsibility (CSR), which was a highly observable business fact that has been overlooked in the earlier stages (Crowther and Capaldi, eds. 2008). It has long been argued that businesses have no other responsibility apart from providing goods and services in return for maximizing profit and thereby have no societal commitment whatsoever (Friedman, 1962 and Hayek, 1969 cited in Marinetto, 1998). Continue reading

The Effect of Divisional, Multinational, Global & Transnational Organizational Structure on HR strategy and Its Practices

Final Part:

A divisional form is an organizational structure that is segregated into different divisions where each division functions independently within its own boundary as the tasks are highly distinctive due to the variety each division entails in terms of the products and services it offers to the market. Independent divisional functions mean the divisions are decentralized from the top and autonomously make their decisions to day to day functioning of their own division, which signify that middle line plays the key role. However, standardization of output that specifies the performance works as the key control mechanism for the divisions to determine their performance assessed sporadically by the top management to ensure controllability, which gives an indication of machine bureaucracy (Mintzberg, 1981).

The autonomous power of divisional managers resulting from the decentralized authority from the headquarters requires them to obtain new skills, which can be gained through supplementary training (Ingham, 1992). Versloot et al. (2001) point out that divisional form entails diversified training programs due to diversified needs of different divisions. Itoh (2003) states that divisional structure is a source of significant motivation for its employees as the division itself is able to establish internal control, self operating procedure, and make own strategic decisions, which substantially improve the performance of the division. Conversely, Kagono et al. (1985 cited in Itoh, 2003) figure out that Centralized monitoring and controlling of performance of each division in terms of their output by the headquarters affect the reward system, which can be a major discouraging factor for the divisions.

A divisional form entails diversified training programs due to diversified needs of different divisions.

Multinational Organizational Structure

They are found operating in different country contexts according to their local business frameworks with little control from their parent companies that implies a decentralized authority structure (Inkpen and Ramaswamy, 2006). This indicates that the formulation of HR strategy and HR practices are minimally controlled by the headquarters (Edwards and Rees, 2006). For example, Rosenzweig and Nohria (1994) point out that HR practices (training, rewards etc.) of the subsidiaries of multinational organizations are different from those of their parents’ practices. Paauwe and Dewe (1995 in Shen and Edwards 2004) state that operating and middle level employees are basically hired from local resources whereas Collings et al. (2007) point out that top level management employees are recruited from the parent company due to their expertise and company experience.

Global Organizational Structure

Such structure focuses on standardizing output to achieve economies of scale in order to enjoy global efficacy (Bartlett and Ghoshal, 1998; Xu et al., 2006) and this is done through decentralized implementation of the major strategic decisions formulated in the parent company (Inkpen and Ramaswamy, 2006). This results in a reproduction parent company’s HR practices and policies to a certain degree (Edwards and Rees, 2006).

Transnational Organizational Structure

Transnational organization is defined as a blend of multinational and global organizational forms (Bartlett and Ghoshal, 1998), which seeks to achieve global efficacy through encompassing positive characteristics from these two organizations (Inkpen and Ramaswamy, 2006). Such organizational structures standardize their output and process to achieve success in global arena (Snell et al., 1998). They show the HR implications by stating that recruitment and selection (polycentric and geocentric), training and development (expand skill base, professional culture, continuous learning, negotiation and interpersonal skills), and reward and appraisals (local appraisal, appraisal base on others input, evaluation based on learning, frequent feedback) take a mixture of HR roles (p. 150).



Abernethy, M. A. and Stoelwinder, J. U. (1990), “The Relationship between Organization Structure and Management Control in Hospitals: An Elaboration and Test of Mintzberg’s Professional Bureaucracy Model”, Accounting, Auditing & Accountability Journal, Vol. 3, No.3, pp. 18-33.
Armstrong, M. (ed) (1992), Strategies for Human Resource Management: A Total Business Approach in Coopers & Lybrand, Kogan Page, London.
Armstrong, M. (2004), Strategic Human Resource Management: A Guide to Action, Kogan Page, London.
Avdelidou-Fischer, N. (2007), “The Relationship between Organizational Structures and Performance: The Case of the Fortune 500”, International Finance Review, Vol. 7, pp. 169–206.
Bartlett, C.A., and Ghoshal, S. (1998), Managing Across Borders: The Transnational Solution, Harvard Business School Press, Cambridge.
Begin, J. P. (1991), Strategic Employment Policy: An Organizational Systems Perspective, Prentice Hall, Indiana.
Bratton, J. and Gold, J. (2007), Human Resource Management: Theory and Practice, Palgrave Macmillan, Basingstoke.
Bredin, K. (2008), “People Capability of Project-Based Organisations: A Conceptual Framework”, International Journal of Project Management, Vol. 26, No. 5, pp. 566–576.
Buford, S. C. (2006), “Linking Human Resources to Organizational Performance and Employee Relations in Human Services Organizations: Ten HR Essentials for Managers”, Intl Journal of Public Administration, Vol. 29, No. 7, pp. 517–523.
Byford, I. M. A. (1994), “Discretion and Accountability in Social Work: A Study of a Professional Bureaucracy”, Department of Government, Brunel University, [Online], Available: [Accessed: 22nd November 2008]
Cheng, J. L. C. (1984), “Organizational Coordination, Uncertainty, and Performance: An Integrative Study”, Human Relations, Vol. 37, No. 9, pp. 829-851.
Collings, D. G., Scullion, H., and Morley, M.J. (2007), “Changing patterns of global staffing in the multinational enterprise: Challenges to the conventional expatriate assignment and emerging alternatives”, Journal of World Business, Vol. 42, No. 2, pp. 198-213.
Daft. R. L. (2001), Organization Theory and Design, South-Western College Publishing, Cincinnati, Ohio.
Denis, J. L., Langley, A., and Lozeau, D. (1991), “Formal Strategy in Public Hospitals”, Long Range Planning, Vol. 24, No.1, pp.71-82.
Edwards, T. and Rees, C. (2006), International Human Resource Management: Globalization, National Systems and Multinational Companies, Financial Times Prentice Hall, Harlow.
Ensign, P.C. (1998), “Interdependence, Coordination, and Structure in Complex Organizations: Implications for Organization Design”, Mid-Atlantic Journal of Business, Vol. 34, No.1.
Fredrickson, J. W. (1986), “The Strategic Decision Process and Organizational Structure”, Academy of Management Review, Vol. 11, No. 2, pp. 280-297.
Giancola, F. (2008), Linking Rewards with Organizational Culture, WorldatWork, [Online],Available:, [Accessed: 22nd November 2008]
Grand, C., Szulkin, R., and Tåhlin, M. (1994), “Organizational Structures and Job Rewards in Sweden”, Acta Sociologica, Vol. 37, No. 3, pp. 231-251.
Grossman, W. and Schoenfeldt, L. F. (2001), “Resolving Ethical Dilemmas through International Human Resource Management: A Transaction Cost Economics Perspective”, Human Resource Management Review, Vol. 11, No. 1-2, pp. 55-72.
Hoy, W. K., Blazovsky, R., and Newland, W. (1983), “Bureaucracy and Alienation: A Comparative Analysis”, The Journal Of Educational Administration, Vol. XXI, No. 2, pp. 109-120.
Hsieh, Y. M. and Hsieh, A. T. (2003), “Does Job Standardization Increase Job Burnout?”, International Journal of Manpower, Vol. 24, No. 5, pp. 590-614.
Ingham, H. (1992), “Organizational Structure and Firm Performance: An Intertemporal Perspective”, Journal of Economic Studies, Vol. 19, No. 5, pp. 19-35.
Inkpen, A. and Ramaswamy, K. (2006), Global Strategy: Creating and Sustaining Advantage across Borders, Oxford University Press, US.
Itoh, H. (2003), “Corporate Restructuring in Japan Part1: Can M-Form Organizations Manage Diverse Businesses”, Japanese Economic Review, Vol. 54, No.1, pp. 49-73.
Jackson, S. E. and Schuler R. S. (1995), “Understanding Human Resource Management in the Context of Organizations and their Environments”, Annual Review of Psychology, Vol. 46, pp. 237-264.
Lindblom, C. E. (1965), The Intelligence of Democracy: Decision Making Through Mutual Adjustment, Collier-Macmillan, London.
Lund, D. B. (2003), “Organization Culture and Job Satisfaction”, Journal of Business and Industrial Marketing, Vol. 18, No. 3, pp. 219-236. McCourt, W. and Eldridge, D. (2003), Global Human Resource Management, Edward Elgar, Cheltenham.
Mintzberg, H. (1979), The Structuring of Organizations: A Synthesis of Research, Prentice-Hall, Englewood Cliffs, NJ.
Mintzberg, H. (1981), “Organization Design: Fashion or Fit”, Harvard Business Review, January-February, pp. 103-116.
Mintzberg, H. (1983), Structure in Fives: Designing Effective Organizations, Prentice-Hall, Englewood Cliffs, NJ.
Mintzberg, H. (1987), “Crafting Strategy”, Harvard Business Review, July-August, pp. 66-75.
Rosenzweig, P. M. and Nohria, N. (1994), “Influences on Human Resource Management Practices in Multinational Corporations”, Journal of International Business Studies, Vol. 25, No. 2, pp. 229-251.
Segal-Horn, S. (1998), The Strategy Reader, Blackwell, Oxford.
Shen, J. and Edwards, V. (2004), “Recruitment and Selection in Chinese MNEs”, The International Journal of Human Resource Management, Vol. 15, No. 4, pp. 814 — 835.
Snell, S. A., Snow, C. C., Davison, S. C., and Hambrick, D. C. (1998), “Designing and Supporting Transnational Teams: The Human Resource Agenda”, Human Resource Management, Vol. 37, No. 2, pp. 147–158.
Tiernan, S. D., Flood, P. C., Murphy, E. P., and Carroll, S.J. (2002), “Employee Reactions to Flattening Organizational Structures”, European Journal of Work and Organizational Psychology, Vol. 11, No. 1, pp. 47–67.
Thompson, M. and Richardson, R. (2004), “The Impact of HR Practices on Business Performance”, Quality Focus, Vol. 4, No. 1, pp. 58-63.
Tomlinson, S. (1995), ‘Machine and Professional Bureaucracies: Barriers to Inclusive Education’, paper presented at the Sociology and Disability, Royal Hotel, Hull, 10-12 October.
van Aart, C. J., Wielinga, B., and Schreiber, G. (2004), “Organizational Building Blocks for Design of Distributed Intelligent System” International Journal of Human-Computer Studies, Vol. 61, No. 5, pp. 567-599.
Versloot, B. M., de Jong, J. A., and Thijssen, J. G. (2001), “Organisational Context of Structured On-The-Job Training”, International Journal of Training and Development, Vol. 5, No. 1, pp. 2-22.
Wang, D. S. and Shyu, C. L. (2008), “Will the Strategic Fit between Business and HRM Strategy Influence HRM Effectiveness and Organizational Performance?”, International Journal of Manpower, Vol. 29, No. 2, pp. 92-110.
Wood, J. A. (2005), “Organizational Configuration as an Antecedent”, Journal of Business & Industrial Marketing, Vol. 20, No. 6, pp. 263–275.
Xu, s., Cavusgil, S. T., and J. Chris White (2006), “The Impact of Strategic Fit among Strategy, Structure, and Processes on Multinational Corporation Performance: A Multimethod Assessment”, Journal of International Marketing, Vol. 14, No. 2, pp. 1-31.



The effect of Professional Bureaucracy & Adhocracy on HR strategy and Its Practices

Part 4:

Professional Bureaucracy

Professional Bureaucracy is defined as a bureaucratic structure with little formalization, which entails a large operating core that is highly autonomous and controlled by trained expertise due to the complex nature of tasks. This indicates that the environmental contingency in which professional bureaucracy works is stable but complex in nature where standardization of skill performs as the prime coordinating mechanism, where the works necessitate great knowledge and skill to create output form input that clearly depict the authority originates from experts’ expertise and lies in their hands to control their works. Abernethy and Stoelwinder (1990) stated that as the autonomous and dominant characteristics of operating core diminish the influence of technostructure, top and middle line over it and the result is a flat organizational configuration. Continue reading

The effect of Machine Bureaucracy on HR strategy and Its Practices

Part 3:

Machine Bureaucracy can be expressed as a large hierarchical, elaborated, rigid structure, which is highly centralized, rule bound and is operated in a simple, stable and predictable environmental contingency. This ensures that the tasks are simple, routine, and repetitive and of highly specialized nature, which are designed by the techno structure –the key part of the organization and require the employees at the operating level have minimal skills to perform the task assigned. Employees’ behavior is highly regulated in terms of job contents that are spelled out in every step of the process, which means that standardization of work process plays as the key coordinating mechanism that gives employees at the operating core very little discretion for judgment. The simplicity of work makes mutual adjustment ineffective and direct supervision of employees by first line managers is limited due to the elaborated size of the operating core and their role to play as contacts with technocrats, immediate superiors and subordinates. Continue reading

The effect of Simple Organizational Structure on HR strategy and Its Practices

Part 2:

The Simple Structure is the simplest form of structural configuration with small managerial hierarchy and low degree of departmentalization. Key part of this structure is strategic apex with operating core at the base and an insignificant middle line, which defines that the flow of authority is top down, the decision making process is centralized and the span of control is wide. In Simple Structure, behavior is least regulated, jobs are least specialized, and there is hardly any use of pre-planned procedure to determine what to do, when and how to do it, how training will be shaped and how liaison will be maintained (Mintzberg, 1979, 1983). Woodward (1965 cited in Mintzberg, 1983) describes that this structure can be visible as a single-purpose firm with no formal planning, little staff, organic relationships and the tasks of which are coordinated by the chief executive. Continue reading

The Implications of Organizational Structure on HR strategies and Its Practices

Part 1:

McCourt and Eldridge (2003:2) define Human Resources Management (HRM) as The way an organization manages its staff and helps them to develop. Bratton and Gold (2007) state HRM as a means of achieving organizational effectiveness through deploying employees’ talent by the use of idiosyncratic HR programs and practices while Thompson and Richardson (2000:58) point out that Human resources (HR) strategies are everywhere measured by HR policies and practices. To help achieve organizational efficacy, HR strategy coordinates and applies HR policies and practices, hence influences the behavior of people of the organization (Wang and Shyu, 2008). Jackson and Schuler (1995) provide an idea of how different organizational structures are shaped by HRM. Continue reading

The Need for Organizational Change & Development

Organizations are –

constantly working and persistently searching for ways to improve their effectiveness and efficiency and applying and implementing different kinds of strategies and practices in order to be well competitive and outwit in local, national, international and above all, global arena in this extremely competitive business environment (Basu, 2001). The way organizations plan, formulate strategies and make decisions has an extremely profound impact on their competitiveness as Coulson-Thomas (1997) illustrates that the necessity of being fit and effective in the rapidly changing business environment demand organizations’ to make changes in the approach they put forward their plans, create their strategies and make their decisions. The indispensability for organizational change is to direct an in a path where it can learn and use its capabilities to meet the expectations of its customers and other stakeholders (Moran and Brightman, 2001).

Continue reading