| In the ear of knowledge-driven economy, and the ever changing environment, human capital is crucial to the success of any company. The effectiveness of human capital management could enhance the core competitive strength of a company and it has been well recognized among companies from various industries. As a key component of human resource management, performance appraisal should be designed as an effective mechanism to promote employee development, realize company’s long-term strategic plan, and ultimately achieve company targets. By setting specified targets and standards, the management of the company works together with the employees to set up their individual tasks and targets. By setting measurable targets and standards, the management works together with the employees to set up their individual tasks and objectives. Then performance of the employees would be evaluated and directed to achieve the final objectives. The importance of performance appraisal has attracted lots of attentions among the Sr. managers recently and it has been widely adopted among many world famous multinational corporations. However in China, due to the planned economy system, little is known about such performance appraisal system. How to establish a well-functioned system for performance appraisal and how to tackle the problems occurred, are some of the many issues left unsolved due to lack of awareness and experience among the domestic companies. As a result, the positive impacts from performance appraisal could not be fully leveraged.Company J is a subsidiary of a famous petrochemical group in China, it is empowered by the parent company to implement a series of management functions. Recently, due to expansion needs, company J has adopted a series of different collaboration models with different foreign companies and established several wholly owned, controlled and joint-stock companies. In 2013, it also started to reform its compensation scheme along with the adoption of the performance appraisal system. However, due to limited experiences and the incompleteness of the system design, how to refine the performance appraisal system of company J has become an imperative task.Using company J as an example, we carried out a comprehensive study on the development of the performance appraisal system and how it was deployed among the various companies. Then afterwards, we combine the theoretical background with empirical evidences gathered from surveys, comparative analysis and literature review to draw our conclusions. From a strategic perspective, we studies the performance appraisal system used by company J presently, identified the problems occurred and then proposed the feasible solutions. With reference to the KPI and 360 feedback methods, we proposed a series of methods to enhance the protective system of the company so as to make its appraisal system more reasonable and systematic. With a clearer relationship between targets and assessment, employees could be further motivated; the company’s competitive strength could also be further enhanced. This study could be used as key reference document for petrochemical companies to establish a sound performance appraisal system in the future. |
