The appraisal system can be designed to minimize the negative dynamics mentioned previously. The manager often has only marginal control over these matters. This paper is intended to suggest what can the company do to create appraisal system or performance measurement that help employees building consensus around the standard of performance that is linked to company strategic business needs.



As the industry is becoming more and more competitive, every company has to prepare and transform itself for competition. The need for the company ability to exploit and monitor the progress, building and acquiring capabilities of their human assets is becoming more critical for future growth or even survival. In today's world, a company that wants to succeed in competitive environment better has a device to plan long-term performance. Performance appraisal as one of management control and monitoring system should built with relation to the company long-term strategic objectives. That is, how to design performance appraisal system that contributes to linking long-term strategic objectives with short-term actions. It should give managers a way of ensuring that all levels of the organization understand the long-term strategy and that company, departmental and individual objectives are aligned with it.



In this paper PT Mulia Industrindo is used as a case company where a new performance system that links company with individual objectives could be introduced.





Research Location: PT Mulia Industrindo

Supervisor: [Wagiono Ismangil]

Accepted: 1996