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Compare and contrast the main claims of Goal Setting and Expectancy Theories with regard to Employee Performance Appraisal. What are the implications for the design of employee appraisal systems?

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  1. Introduction.
  2. What is performance appraisal?
  3. Goal setting theory.
  4. Expectancy theory.
  5. Consequences on the design of employee appraisal systems.
  6. Goal definition process.
  7. Evaluation.
  8. Rewards.
  9. Motivation.
  10. Conclusion.
  11. References.

The history of performance appraisal in the literature is quite recent. Its roots in the early 20th century can be traced to Taylor's pioneering time and motion studies, which interestingly also sets the beginning of the goal-setting theory. But this may not be very helpful, for the same can be said about almost everything in the field of modern Human Resources Management. Yet in a broader sense, the practice of appraisal is a very ancient art. In the scale of history, it might well deserve claim to being the world's second oldest profession. As Albert Camus wrote, "we should not wait for the last judgment - it takes place every day". Making judgments about those one is working with, as well as about oneself, is a basic human tendency. As a result, it seems appraisal is both inevitable and universal. Indeed, in the absence of a carefully structured system of appraisal, people will tend to judge the work performance of others, including subordinates, naturally, informally and arbitrarily. Thus, to avoid such injustice, a formal system of performance appraisal is needed to ensure, or at least to aim at ensuring, lawful, fair, defensible and accurate judgments.

[...] Finally, the paper critically assesses the similarities and differences in the major claims of both theories with regard to the design of a performance appraisal system. What is performance appraisal? Defining performance appraisal requires defining what a performance is in the first place. A performance can be assimilated to a direct outcome or contribution to what an employer values. Consequently, performance appraisal is the comparison of achievement against goals or objectives and on assessment of competencies (Mitchell, Thompson, George-Falvy, 2000). [...]


[...] Specifically, it has to do with the fact that a certain type of goal, the learning goal, helps employees acquire the knowledge to understand and apply what they are doing. For complex tasks, setting goals based on one's knowledge stimulates the development of task strategies to complete those tasks. Seijts and Latham illustrate their stance with the example of the Weyerhaeuser Company. This firm discovered that unionized truck drivers who had been assigned a specific high-performance goal in terms of the number of trips per day from the logging site to the mill started to work "smarter rather than harder". [...]


[...] Consequences on the design of employee appraisal systems To summarise what has been presented in the two previous sections, the two approaches of goal setting and expectancy theories differ in emphasis: goal setting focuses on the motivational impact of goals whereas the expectancy theory stresses the capability of the appraisee to reach goals and obtain rewards. Nonetheless, as Locke and Latham (2002) analyse, both theories are personalised to employees' needs and goals. Managers' responsibility throughout the appraisal process is to help employees meet their needs and at the same time attain organisational goals. [...]

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