Professionals' performance appraisal practice in construction companies

Effective implementation of the human resource management (HRM) functions; i.e. recruitment and selection, performance appraisal (PA) and employing relevant retention strategies, would help companies to ensure their competitiveness and reputability. Focusing on construction companies, this study particularly assesses the professionals' PA practice and the associated challenges, and evaluates the impact on the organizational performance (OP) in the context of Ethiopian construction industry. A mixed-methods approach comprising a questionnaire survey, semi-structured interviews, and document analysis, was employed in collecting the data. Multiple linear regression was used to analyze the impact of the PA practice on OP. The findings indicate a significant dependence of OP on PA practice. Major challenges associated with PA practice include seasonal work fluctuation, uncertain nature of projects affecting professionals' performance, inability to establish common standardized performance metrics for different project characteristics, and lack of continuous training and development. An improvement framework with four major strategies was developed aiming at improving the PA practice: (i) utilizing standardized PA processes, (ii) providing continuous feedback and improvements, (iii) implementing a strong performance recognition and rewards system, and (iv) establishing clear performance criteria. The findings will provide valuable guidance for the companies seeking to improve their PA practice.