Appraisal Practices and Cultural Intelligence Impact Young Talent Performance

This study examined the influence of Performance Appraisal Practice and Cultural Intelligence on Employee Performance mediated by Employee Engagement among Generation Z and millennial employees in Jakarta's creative industry. With these generations dominating the workforce and projected to drive Indonesia's economic growth, understanding factors affecting their performance became critical, particularly as traditional HRM practices might not align with younger generations' expectations regarding performance evaluation, cultural dynamics, and engagement mechanisms. This quantitative study employed Structural Equation Modeling (SEM) using AMOS software to analyze data from 164 employees working in creative agencies in Jakarta, collected through purposive sampling using validated questionnaires. The findings revealed that Cultural Intelligence positively affected both Employee Engagement and Employee Performance, while Performance Appraisal Practice negatively affected Employee Performance directly. Employee Engagement did not directly affect Employee Performance, suggesting that in creative contexts, performance depended more on project-specific factors than engagement levels. However, Employee Engagement significantly mediated both the Performance Appraisal Practice-Employee Performance relationship and the Cultural Intelligence-Employee Performance relationship, demonstrating that these variables influenced performance through enhanced engagement pathways. These results challenged traditional HRM assumptions and established that performance appraisal systems must function as engagement-building mechanisms rather than control tools for younger generations. The study contributed by demonstrating the critical mediating role of engagement and establishing cultural intelligence as essential in multicultural creative environments, providing valuable insights for organizations developing integrated HRM strategies to enhance millennial and Generation Z workforce performance.