Performance Appraisal of
International Employees
Presented by:
Ka Wai Li
Phillip Gong
Ethan Hung
Lawrence Huang
Joanna Chan
Today’s Agenda
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Background of performance appraisal
IHRM Vs HRM
Employee characteristics in the United Stated and China
Two types of motivation theories in the U.S
External Rewards and Internalized motivation in China
US performance appraisal system
Chinese views of performance
Research Findings
Recommendations and conclusion
What is Performance Appraisal
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A communication instrument aimed to evaluate
each individual's contribution
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To determine ability and achievement with
reasonable accuracy and consistency
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To help identify obstacles to top performance
Why Appraise Performance
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Episodic evaluation helps supervisors acquire a
better understanding of each employee's skills with
the goal to facilitate train and develop abilities and
potency
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A opportunity to assess job progress, encourage interest
and improve job performance by pointing out areas of
development and by recognizing productive work
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A feedback system that might otherwise be overlooked
IHRM Vs HRM
IHRM has three dimensions:
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The broad human resource activities of procurement,
allocation and utilization
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The national or country categories involved in IHRM
activities
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The three categories of employees of an international
firm
IHRM Vs HRM
HRM has six activities:
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Human resource planning
Staffing
Performance Management
Training and Development
Compensation and Benefits
Industrial Relations
Differences between domestic
and IHRM
 More HR activities
 The need for a broader perspective
 More involvement in employees’ personal lives
 Changes in emphasis as the workforce mix of
expatriates and locals varies
 Risk exposure
 Broader external influences
Employee Characteristics in
United Stated and China
Geographic Location
North America,
bordering both
North Atlantic
Ocean and
North Pacific
Ocean, between
Canada and
Mexico
Overview of United Stated Labor
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146 million Labor Force
(2003)
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Agriculture: 1.4%
Industry: 26.2%
Services: 72.5%
Unemployment rate: 6%
(2003)
Average working hours
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8 hours/day
5 days/week
Agriculture
1%
Industry
26%
Services
73%
Two Type of Motivation Theories
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Content Theories
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Focus on “what,” identifying the factors that cause
people to put effort into work
Process Theories
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Concern on “how,” the steps an individual takes in
putting forth effort
Example:
Culture with
low Uncertainty
Avoidance in the
United States
Working Styles
- Lesser rules
-Lesser formalities
-More flexible
-More acting on changes
How related?
US values
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Freedom
Individual
Not a great emphasis on
history
Equality
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US Working attitudes
Freely give opinions
Competition is
encouraged
Present-oriented
culture
Having the equal rights
in the workplace
Maslow’s Hierarchy of Needs
Physiological needs
 Safety and Security needs
 Affiliation needs
 Esteem Needs
 Self-actualization
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What do
we need?
Common Benefits
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Fair working conditions
 private working area
 clean and warm environment
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Cafeteria Plan
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Cash (taxable). E.g. dividends
Healthcare plan
Group term life insurance
Disability insurance and accidental death and
dismemberment insurance
Elective contributions to 401K plan.
Elective paid vacation/sick leaves.
How to motivate employees more
effectively?
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Praising their works
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Internal job promotion
Fulfilling their affiliation needs
Incentive Travel
 Company Parties/Activities
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Geographic Location
Eastern Asia,
bordering the East
China Sea, Korea
Bay, Yellow Sea,
and South China
Sea, between
North Korea and
Vietnam.
Overview of Chinese Labor
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778 million Labor Force
(2003)
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Agriculture 50%
Industry 22%
Services 28%
Unemployment rate:
10% (2003)
Average working hours
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10 hours/day
6 days/week
Services
28%
Agricultur
e
50%
Industry
22%
Chinese workers Characteristics
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Focus on moralistic
Maslow’s Hierarchy of Needs
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External Rewards
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Physiological Needs
Internalized Motivation
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Self-actualization needs
Example of “External Rewards”
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Material incentives use to stimulate performance
Money as a motivator for employees
Bonuses have exist in China since 1978
Pay system is based on individual performance
Reflect a strongly collectivist culture
Pay differentials based in length of service
Wage structures based on subsidies, bonuses &
allowances
Performance is short-term, loyalty & belongingness
are long-term
Example of “Internalized motivation”
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Political Campaigning
 Emulation Campaign
 Tiananmen Square in 1989
Japanese Companies in China
 Send Chinese employees to Japan to learn in order
to expose a foreign culture.
Build on a sense of belongingness & loyalty
Difficulties for Managers
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Definition of Performance varies in different
culture
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No cross-cultural studies concentrate on
performance appraisal
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How is performance defined
Why is performance evaluated
How is it measured
Perspectives on Performance
Appraisal
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Tool of organizational control
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Cognitive aspects of managers’ evaluation of
performance
US Performance Appraisal
System
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To build up employee performance plan
Discuss performance plan
Evaluating
Rewarding
Provide assistant
Repositioning or removing
Identifying
American Views of Performance
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Objective: To help achieve organizational
objectives
Productivity and Quality
Achievement
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Individual, group or organizational objectives
“rate the performance, not the person”
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Concentrate upon performance items
Chinese views of Performance
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Objectives: Maintain family control of business
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Performance appraisals favor workers that are loyal
to the family
Emphasis upon “moral” characteristics
Characteristics that affect Chinese
Performance appraisal
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Fatalism
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Confucianism
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Adapting oneself to the world
Moral character is the most important
Face
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Blame external factors to keep the face
Research Findings
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Survey by HR consulting firm Development
Dimensions International (DDI)
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Participants
 Local Chinese and foreign invested
companies
Results
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95.8% use a company-sanctioned performance
management system
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79.2% use the system for all employees and
some of the organization
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12.6% use their performance management
system for only 60% or fewer of their
employees
Results (cont’)
Areas that are effective:
1. Structuring specific performance plans
2. Reviewing performance with employees at
least once a year
3. Linking performance to pay
4. Holding supervisors accountable
Results (cont’)
Areas that need improvement:
1. Developing the skills of appraisers
2. Evaluating performance in a fair manner
3. Reviewing approaches to differentiate the
performance of employees
4. Increasing employees’ involvement in the
performance management process
Recommendations and
conclusion
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Continual feedback
Communication skills
Equity, fairness, transparency
Forward-looking approach
HR as overseer
Thank You!