Proposes that by redirection performance appraisal can become a pivotal force for translating, articulating and instilling commitment to an organization′s strategy. Presents a framework for assessing the success and failure of performance appraisal systems in achieving their evaluation and development role on several dimensions. Resolves the limitations of conventional systems by transcending the dysfunctional conflict between evaluation and development. The transformational performance appraisal system is consistent with the new ways of managing and with new organizational forms.
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