Application Of Corporate Functions Department Performance Appraisal System Based On Performance Prism Theory

Competition becomes more intense and the internal functional departments’standard of management demand is ever-increasing, so how to design and establish ascientific performance appraisal system for the functional departments is becomeparticularly important. But the nature of the work of the functional departments makesthe performance appraisal “both assessment and not the assessment are also difficultproblems”. The mainly reason why performance appraisal of corporate functions is sodifficult is that the object of service of the corporate functions are numerous, itincludes not only the internal corporate management, other departments within theenterprise, employees, but also government departments, tax departments, personneldepartments etc. This has resulted in the contribution of corporate functions for thesepeople and departments are difficult to fully and reasonably measure and corporatefunctions’ performance is difficult assessment.Based on these key matters of performance management in X Company itself,comparing with those popular approaches of performance assessment this paperproposes that the Performance Prism Theory is the most proper approach to solvingthese matters. The Performance Prism Theory pays more attention to the stakeholdersand the core of the theory is to achieve stakeholder satisfaction, companies need whatkind of work. This is consistent with the work characteristics of finance departmentwhich is to provide all kinds of services in order to meet the needs of departmentstakeholders.To build the performance prism model-based performance appraisal system, at first,analyze the various stakeholders of the financial department of X Company and set ofassessment indicators based on “stakeholder satisfaction”“strategy”“process”“capability”; then, use the idea of the Analytic Hierarchy Process to determine theweights of the various indicators; finally design of the performance evaluation indexsystem based on the actual situation of the finance department of X Company.Through the implementation of the results of the performance appraisal indexsystem, the performance prism model does have some help to enhance the level ofperformance of the financial department, but also can be found a large number ofdefects and shortcomings. Due to the limited time and the level of the author, this paper failed amendments to the defects and shortcomings. Overall, this paper isreference for China’s enterprises to implement effective performance management ofthe functional departments.