HRM Essay Example about Performance Appraisal within PepsiCo

Performance appraisal is a necessary tool for every business. It helps an organization to achieve its mission, vision, values, and strategic aims. The organization adopted for this review is PepsiCo. Based on its current performance appraisal, it can help it achieve its mission, vision, values, and strategic aims to some extent. However, certain factors need to be incorporated into this process to make it more effective. This essay shows how using the new trends in the management such as continuous review, elimination of metrics and evaluation of management can be used to improve the performance appraisal process of the PepsiCo.

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Different companies usually adopt different methods for conducting the appraisal. In the PepsiCo, the current process for performance appraisal is the tabulation method, also known as a graphical rating scale. It is performed through an ERP system that is supported by oracle. In PepsiCo, it adopts an appraisal system known as Performance Development Review PDR. Use of the rating scale enables the management to assess the performance of an employee in different areas ranging from poor to excellent performance. The content of appraisal usually involves; the quantity of work for an employee under normal conditions and the quality of work, i.e. accuracy, thoroughness and neatness. In PepsiCo appraisal consists in filling a form with five sections, namely; employee qualification, performance, integrity, leadership skills and resources training and succession training. Other aspects involved to assess performance appraisal include initiative, cooperation, attitude, judgment and dependability of an employee. The rating of an employee will be rated using the rating scale, which in five elements, which are; outstanding, good, satisfactory, fair, and unsatisfactory (PEPSI PROJECT HRM, 2017). The advantage is using this scale for rating performance is that it is less time consuming, and it also allows valid quantitative comparison.

PepsiCo usually adopts PDR as a method of performance appraisal. It involves the following five steps, and they are as follows. The first step consists in setting the goals and objectives of the employees. The second step consists of reviewing employee performance after three months. The 3rd step involves a review that is always conducted at the mid of the year. This review aims to determine whether there are employees who are behind the targeted standards or lacking. This help to determine whether specialized training will be required to speed up the work process. The 4th step involves a self-evaluation held in November, and the last step consists in conducting performance appraisal by the HR department (Shome, 2014).

However, there are specific gaps in individual data. For example, the company needs to come up with a strategy to measure non-quantifiable data such as employee innovation and initiative. Innovation skills of an employee can be measured trough aspects such as suggestions they make that can be used to improve the work process. The initiative can be measured by trough aspects such as the ability to solve conflict without supervision. Employees with exciting and fresh ideas mean a lot for an organization and hence, they should be considered in the appraisal (McDavid, Huse, & Hawthorn, 2018). According to DeNisi & Smith (2014), certain information though necessary in an organization, may not be quantifiable. Since PepsiCo use only quantifiable data, it may miss such kind of data. However, the method used by PepsiCo to measure performance is accurate, measurable and well defined. Besides, some aspects missing in the PepsiCo appraisal process which denies the employees fair chance of involvement in deciding on changes that can be used to improve their working conditions such as evaluation of management and their recommendations. These aspects should be included for it to achieve its objectives.

The figure appendix one show how PepsiCo appraisal process ought to be for it to fulfill its mission, vision, values, and strategic aims. This can be achieved by adopting new trends in management that can enhance the effectiveness of an organization performance appraisal for it to meet its objectives. One of the trends in the ongoing revolution rather than annual evaluation as most companies use. According to Shome (2014), continuing review and reporting of employee performance help a company to not areas that need improvement and acting on them rather than waiting until the end of the year. In the PepsiCo, review is done after every 3months but it can be done monthly to make it more effective. The other thing is the management evaluation. In the PepsiCo Company, management is never evaluated. However, according to DeNisi & Smith (2014), giving the employee a chance to assess the management in a different area can help improve performance since management is an integral part of an organization. The next new trend that PepsiCo needs to include in its appraisal process is eliminating the matrix method as the only way of correcting individual performance information. DeNisi & Smith (2014) asserted that some of the data could not be quantified though important. Using other methods to collect and rate unquantifiable data need to be adopted in the PepsiCo appraisal process to make it more effective.

The performance appraisal process of PepsiCo is competent, and it can help it attain its mission, vision, values, and strategic aims to some extent. However, there are specific gaps that need to be filled in this process. Continuous review, elimination of metrics and evaluation of management are the three factors found in a new trend of management which can be used to improve the performance appraisal process of PepsiCo to make it more effective. The flow chart in the appendix shows how PepsiCo performance appraisal ought to be for it to fulfill its mission, vision, values, and strategic aims.

References

DeNisi, A., & Smith, C. E. (2014). Performance appraisal, performance management, and firm-level performance: A review, a proposed model, and new directions for future research. Academy of Management Annals, 8(1), 127-179.

McDavid, J. C., Huse, I., & Hawthorn, L. R. (2018). Program evaluation and performance measurement: An introduction to the practice. Sage Publications.PEPSI PROJECT HRM. (2017, April 26). Retrieved from https://www.slideshare.net/angeloxide50/pepsi-project-hrm

Shome, S. (2014). Performance Appraisal at Pepsi - six. Retrieved from https://studylib.net/doc/9393291/performance-appraisal-at-pepsi---six