ABSTRACT

Research on performance management (PM) has increasingly focused on how knowledge plays into improving business competitiveness and the corresponding challenges for effective performance appraisal (PA). In particular, studies have aimed to understand better how human resources (HR) practices increase knowledge (Despres and Hiltrop, 1995; Thite, 2004) and how appraisals influence the performance of knowledge workers (Smith and Rupp, 2004; Wilson et al., 1994). This effort is critical for knowledge-intensive firms (KIFs), that is, organizations that compete with sophisticated knowledge or knowledge-based products using the intellectual skills of highly trained employees, who comprise a very large proportion of their workforce (Alvesson, 1995, 2004; Blacker, 1995). Thus, the context of KIFs presents an important challenge to traditional HRM practices, especially in terms of appraising knowledge workers’ effort and output.