Performance management systems and multinational enterprises:Where we are and where we should go


In this comprehensive summary, we take a critical look at the state of performance management systems in multinational enterprises, summarizing what we have learned to this point, and speculating on where the field should go. We specifically address four challenges (i) can performance really be managed? (ii) if so, how do we go about doing this? (iii) the need to balance consistency across locations with the need to accommodate unique realities of individual locations, and (iv) addressing the different employee profiles - i.e., expatriates vs. host country nationals. In terms of what we have learned to this point, we believe that global organizations need to pay more attention to (i) performance context, (ii) ratee reactions, and (iii) rater motivation, as these are integral to successful performance management. On the other hand, they might re-consider and re-visit the amount of time and energy spent on factors such as (i) appraisal forms and (ii) rater training, as these may not be serving any useful purpose. We next discuss the unique challenges faced by multinational enterprises, including (i) the type of strategy a corporation might employ (Bartlett & Ghoshal, 1998), (ii) the different cultures of the nations where the organization operates (Hofstede et al., 2010), and (iii) managing the performance of expatriates (Toh & DeNisi, 2007). Looking ahead, we would like to remind multinational corporations (and all other corporations) that culture and context matter, but these must be addressed in concert with the need to treat all employees fairly and consistently. We conclude by proposing several research ideas, including the need to explore the potential role of host country nationals in the performance management process for multinational enterprises.

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Divisions: College of Business and Social Sciences > Aston Business School > Work & Organisational Psychology
College of Business and Social Sciences > Aston Business School > Aston India Foundation for Applied Research
College of Business and Social Sciences > Aston Business School
Additional Information: This is the peer reviewed version of the following article: DeNisi, A., Murphy, K., Varma, A., & Budhwar, P. (2021). Performance management systems and multinational enterprises: Where we are and where we should go. Human Resource Management, which has been published in final form at This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for self-archiving.
Uncontrolled Keywords: expatriates,global PMS,host country nationals,performance appraisal,performance management,Applied Psychology,Strategy and Management,Organizational Behavior and Human Resource Management,Management of Technology and Innovation
Publication ISSN: 1099-050X
Last Modified: 18 Jun 2024 16:01
Date Deposited: 15 Jul 2021 10:13
Full Text Link:
Related URLs: https://onlinel ... .1002/hrm.22080 (Publisher URL)
http://www.scop ... tnerID=8YFLogxK (Scopus URL)
PURE Output Type: Article
Published Date: 2021-09-01
Published Online Date: 2021-07-10
Accepted Date: 2021-06-29
Authors: Denisi, Angelo
Murphy, Kevin
Varma, Arup
Budhwar, Pawan (ORCID Profile 0000-0001-8915-6172)



Version: Accepted Version

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