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Performance management is the process of creating a work environment or setting in which people are enabled to perform to the best of their abilities. Performance management is a whole work system that begins when a job is defined as needed. It ends when an employee leaves your organization. Many writers and consultants are using the term performance management as a substitution for the traditional appraisal system. I encourage you to think of the term in this broader work system context. A performance management system includes the following actions. Develop clear job descriptions. * Select appropriate people with an appropriate selection process. * Negotiate requirements and accomplishment-based performance standards, outcomes, and measures. * Provide effective orientation, education, and training. * Provide on-going coaching and feedback. * Conduct quarterly performance development discussions. * Provide promotional/career development opportunities for staff.


Factors that are considered as problems in Performance appraisal are Failure of the superiors in conducting performance appraisal and post performance appraisal interview. Most part of the appraisal is based on subjectivity. Less reliability and validity of the performance appraisal techniques. Negative ratings affect interpersonal relations and industrial relations system. Influence of external environmental factors and uncontrollable internal factors.

Feedback and post appraisal interview may have a setback on production. Management emphasizes on punishment rather than development of an employee in performance appraisal. Some ratings particularly about the potential appraisal are purely based on guess work.


I have chosen Performance Appraisal as my topic because Performance Appraisal is viewed as a beneficial process within the context of an effective system of personnel management. It is a very effective tool to improve performance and productivity and for developing employees. It is accepted as a normal management responsibility to review the performance of all employees and for all managers to discuss performance with their subordinates on a regular basis. It helps individuals to do better, raises self-esteem and motivation. Above all it strengthens the management/subordinate relationship and fosters commitment. Performance evaluation is not a process to be avoided; rather it should be implemented in all organizations and promoted as a key management activity. The benefits to be realized from a proper evaluation system far outweigh the time and effort required to develop, implement and maintain the process.


Performance appraisal is significant for every organisation and provides several valuable benefits to both employees and the organisation. It helps in strategic development of the organisation and helps it gain competitive advantage. Performance appraisal improves the performance of the organisation. It lets the boss and the subordinate develop a plan for correcting any deficiency that the appraisals have uncovered. It also helps in reinforcing the things the subordinate does correctly. Performance appraisal system helps to evolve strategic training programs to equip the employees with necessary skills for job fulfilment. The evaluation may provide ideas for refining established practices or instituting new ones Appraisal of performance improves the performance of the employees, by means of the feedback. Although not all employees have the same amount of desire to improve, generally all of them want to know how well they are performing. Performance appraisal can have a massive effect on the level of employee motivation and satisfaction. . Motivation and the human basic needs go hand-in-hand. It is thus very important for the organizations perspective to motivate their employees.


Objective: The main objective of performance appraisals is to measure and improve the performance of employees and increase their future potential and value to the company. Other objectives include providing feedback, improving communication, understanding training needs, clarifying roles and responsibilities and determining how to allocate rewards. The scope of performance appraisal should include the following: Provide employees with a better understanding of their role and responsibilities Increase confidence through recognizing strengths while identifying training needs to improve weaknesses Improve working relationships and communication between supervisors and subordinates Increase commitment to organizational goals Develop employees into future supervisors; assist in personnel decisions such as promotions or allocating rewards Allow time for self-reflection, self-appraisal and personal goal setting.


The research methodology used to evaluate the accuracy and effectiveness of the appraisal instrument takes different forms and depends on the type of career professional under the microscope for evaluation, but the foundation for all evaluations rests on several basic research techniques. The evaluation methodology corroborates the original employee evaluations and performance appraisals through supporting multiple research reporting measures. o Correlating Data and Appraisals Correlating operational data on employee firing and reprimands offers one way to assess the validity of the employee appraisal systems in place at the workplace. o Self-Assessments and Supervisor Evaluations Other forms of evaluation for performance appraisal systems include input from employees using self-assessment tools and also supervisor appraisals of the system of evaluation. The employee self-reflection offers the vantage point of examining the evaluation from the worker level o Direct Observation The use of multiple research measures to evaluate performance appraisal systems includes using secondary outside assessment teams to support or challenge the original appraisal staff findings. o Client or Customer Evaluations Another research methodology used to evaluate the findings from employee performance appraisal systems involves setting up an additional study involving work customers or business clients.