Even with recent advances in communications technology, communicating
strategy in MNCs is more complicated due to their competitive arena and the
latitude, inherent in their strategies, to respond to competition differently,
both strategically and structurally (Bartlett and Ghoshal, 1992).
Setting individual performance goalsEffective individual performance goals are said to be those that are Specific,
Measurable, Achievable, Realistic and Timely (SMART) (Flamholtz et al., 1985).
They should also reflect critical success factors or key performance indicators of
the job role. In control terms, goal setting is said to be critical for organizations
seeking to ‘increase the probability that individuals and groups will behave in
ways that lead to the attainment of organizational goals’ (Flamholz et al., 1985:
36). Tasks to be performed by employees are usually communicated in the first
instance in the position or job description. In performance management terms,
this process should occur with extensive employee involvement and in the
context of both the immediate position and the whole organization
(Armstrong, 1994).
The rationale for such involvement appears to be that participation in goal
setting ‘has been found to be related to the acceptance and subsequent com-
mitment to the established goals, leading to favourable outcomes in terms of
both performance and attitudes’ (Flamholtz et al., 1985). However, this is
essentially a western perspective and there will probably be variations in the
manner in which goal setting is conducted across the MNC. For example,
Tahvanainen (1998), in her case study research of a large Finnish MNC, found
that employees in Germany and Sweden commonly participated in goal setting
for their jobs, but those in the USA tended to have their job goals assigned.
Cultural differences in the nature of performance goals have also been noted
(Rubienska and Bovaird, 1999).
Providing feedback on progress
towards goal achievementFeedback ‘as part of a control system refers to the information provided about
work behavior and outcomes’ (Flamholtz et al., 1985: 41). Feedback controls the
work behaviour of organization members by directing behaviour through the
provision of necessary feedback for corrective action. Also, it motivates behav-
iour by acting as a promise for future rewards. Therefore, such feedback through
the performance appraisal activity is central to performance management and
has two distinct purposes: evaluation and development (Cascio, 1991).
In MNCs, great physical distance, which often exists between subsidiaries
and the headquarters, can result in lack of meaningful, effective observation,
320 International Human Resource Management