The world’s globalization policies and the increasing stringent anti-discrimination policies improve the need for effective performance appraisal systems.
Every business in the world is engaging in performance appraisal making it to the top list of the business priorities (Lapsley &. Hill, 2008). The human resource teams in every business are mandated with the tasks of generating the best and most compliant performance appraisals. The human resource departments are mandated with authority to create and develop effective policies within the company that will oversee the alignment of the company’s goals and employees’ performance (Haidt, 2001). Even so, there are so many pitfalls and challenges that the department encounters in its performance (Lawlor, 2007). Most of these issues are ethical dilemmas that face the business and its stakeholders. Most of these ethical dilemmas are increasingly witnessed when the appraisal performance systems of the business are inadequate. A poorly-developed performance appraisal is ineffectual and may lead to the creation of psychological damages (Lapsley &. Hill, 2008).
Performance appraisal may result in an ethical dilemma if it is not applied using a clear criterion. Performance appraisal is a system where the job performance of an employee is documented and later critical evaluation is performed on the performance (Lapsley &. Hill, 2008). They form parts of career development for employees by conducting appraisal reviews on a regular basis. There is a set criterion that is followed in conducting performance appraisal. There are factors that are regularly used in gauging performance such as assessment of strengths and weaknesses of an individual, (Buchanan &. Ess, 2009) future development and improvement in skills and functionality, and accomplishments among many other factors. The ethical appraisal is an important aspect that impacts positively on the business performance.