In the changing and dynamic world, whilst companies endeavour to achieve their short and long term objectives in an efficient and effective manner, evaluating their human resources (HR) is regarded as an essential and fundamental process for achieving organisational objectives. However, the performance appraisal (PA) process is not only important for being the main provider of data in order to make HR related administrative decisions, but it also helps to provide information for identifying and influencing the development and satisfaction of the employees in carrying out their duties. This, in turn, contributes towards the achievement of the organisational objectives.\ud The universities are knowledge-based organisations dependent entirely on the commitment and innovation of their teaching staff, and, therefore, they are different in terms of the organisational activity from other institutions. However, the management of universities, as educational institutions, is not that much different from other organisations. Therefore, all the management issues faced in other organisations are also relevant to universities, including HR management strategies drawn from PA systems (PASs). Hence, this study aims to evaluate the current PAS in Saudi Arabian public universities according to the perceptions of the teaching members who are subject to the PA process. It also aims to develop a new PAS based on the results developed from the research.\ud In responding to the aim of the study, a questionnaire schedule was developed and conducted in four major public universities in Saudi Arabia. The researcher sent out 351 questionnaires, of which 197 were returned, giving a return rate of 56%. \ud The results of the empirical analysis demonstrate that the participants are not happy with the existing PAS. In addition, it reveals: communication, transparency and organisational problems related to both the ratees who are subject to the PAS and the raters who carry out the process; poorly designed forms are used in the process; and problems related to the procedures that regulate which may undermine the appraisal process. Thus, dissatisfaction with the existing PASs is established through various empirical analyses.\ud According to the findings of the study and the in-depth of the discussion of the analysed data, the study proposes an integrated and dynamic model for conducting the PA process. This proposed model is constructed with six stages: (1) Planning for Performance Appraisal; (2) Performance Execution; (3) Assessment (Informal Appraisal); (4) Performance Assessment (Formal Appraisal); (5) Interview; and (6) Action. In each stage several issues have been emphasised to improve overall efficiency of the PAS. The study also provides certain assumptions and recommendations for the successful development and implementation of the proposed model, which top level management in each university has to take into consideration to ensure the efficiency and effectiveness of human resources.\u
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