PERFORMANCE APPRAISAL

Performance Appraisal is the systematic evaluation of the performance of employees and to

understand the abilities of a person for further growth and development. Performance
appraisal is generally done in systematic ways which are as follows:

1. The supervisors measure the pay of employees and compare it with targets and plans.

2. The supervisor analyses the factors behind work performances of employees.

3. The employers are in position to guide the employees for a better performance.

Objectives of Performance Appraisal

Performance Appraisal can be done with following objectives in mind:

1. To maintain records in order to determine compensation packages, wage structure,

salaries raises, etc.

2. To identify the strengths and weaknesses of employees to place right men on right
job.

3. To maintain and assess the potential present in a person for further growth and
development.

4. To provide a feedback to employees regarding their performance and related status.

5. To provide a feedback to employees regarding their performance and related status.

6. It serves as a basis for influencing working habits of the employees.

7. To review and retain the promotional and other training programmes.

Advantages of Performance Appraisal

It is said that performance appraisal is an investment for the company which can be justified
by following advantages:

1. Promotion: Performance Appraisal helps the supervisors to chalk out the promotion
programmes for efficient employees. In this regards, inefficient workers can be
dismissed or demoted in case.
 2. Compensation: Performance Appraisal helps in chalking out compensation packages
for employees. Merit rating is possible through performance appraisal. Performance
Appraisal tries to give worth to a performance. Compensation packages which
includes bonus, high salary rates, extra benefits, allowances and pre-requisites are
dependent on performance appraisal. The criteria should be merit rather than
seniority.

3. Employees Development: The systematic procedure of performance appraisal helps

the supervisors to frame training policies and programmes. It helps to analyse
strengths and weaknesses of employees so that new jobs can be designed for efficient
employees. It also helps in framing future development programmes.

4. Selection Validation: Performance Appraisal helps the supervisors to understand the

validity and importance of the selection procedure. The supervisors come to know the
validity and thereby the strengths and weaknesses of selection procedure. Future
changes in selection methods can be made in this regard.

5. Communication: For an organization, effective communication between employees

and employers is very important. Through performance appraisal, communication can
be sought for in the following ways:

a. Through performance appraisal, the employers can understand and accept

skills of subordinates.

b. The subordinates can also understand and create a trust and confidence in
superiors.

c. It also helps in maintaining cordial and congenial labour management

relationship.

d. It develops the spirit of work and boosts the morale of employees.

All the above factors ensure effective communication.

6. Motivation: Performance appraisal serves as a motivation tool. Through evaluating

performance of employees, a person’s efficiency can be determined if the targets are
achieved. This very well motivates a person for better job and helps him to improve
his performance in the future.
Scope of performance appraisal

The scope of any 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 Importance of Performance Appraisals

People work in organizations for monetary and nonmonetary reasons. While

monetarily, employees look forward to increasing pay and perks, they also look for job
satisfaction and fulfillment in their jobs. Thus, the motivators that determine whether a
particular employee would stick to the job or leave the organization are based on the
monetary and nonmonetary incentives.

For instance, monetarily, they might be expecting a pay rise every year in addition to
healthy bonuses. In the same manner, they expect recognition for their work as well as job
satisfaction through challenging assignments. As all these aspects are determined during the
appraisal process where not only the pay and perks but also the chances for promotion and
being given more fulfilling work are decided.

Thus, it is clear that performance appraisals must be taken seriously in addition to

being accorded the importance they deserve. Indeed, performance appraisals can be thought
of the most important time in an employee’s stint with the organization and hence, they must
also be conducted with care and caution.

In addition, given the fact that managers also share feedback, performance appraisals
can be occasions for letting the employee know where they are doing well and which aspects
they need to improve their performance.
Why Performance Appraisals Must be Conducted with Care and Caution

Given these reasons and factors that deem how important performance appraisals are,
most organizations have well-defined processes in place to conduct and review employee
performance. While some organizations conduct performance appraisals every six months,
the others do an annual review of performance.

Apart from this, the performance appraisals also involve multiple levels of employees
wherein the immediate manager and the manager’s manager usually take part in the reviews
along with the concerned employee.

Further, some organizations also require the Human Resources Manager to take
part in the reviews in addition to the designated people manager for that particular
project. Indeed, while this is not the norm in all organizations, the presence of the HR
manager is required when the employees have to be told about placing them on performance
improvement plans and other enhancing initiatives so that such programs can be reviewed
and their work monitored for compliance or noncompliance.

Apart from this, performance appraisals usually entail multiple rounds of discussion
wherein the concerned employee first uploads his or her perceptions about how well he or she
did on the HR portal and then, the manager and the manager’s manager share their feedback
which is followed by face to face discussions and the final closure is given after all parties
agree to the contents of the review.

Indeed, most multinational organizations have a policy of requiring the consent of the
employee with regards to the rating and the feedback, and this is the reason, the presence of
the HR manager helps in cases where the employee refuses to give his or her consent.

Moreover, performance appraisals are usually tied to the financial or the operational
year so that pay and bonuses, as well as promotions, can be linked to these timelines. Indeed,
many multinational organizations conduct performance appraisals in the calendar year-end
whereas Indian firms usually conduct such reviews in the financial year-end.

Apart from this, the other reason why performance appraisals are so important is that
the recognition of employee performance and the subsequent rewards and incentives system
follows the review wherein the top performers usually are given awards during the
organizational In-House and Town Hall gatherings.
 In other words, the review and the ratings are followed by such rewards for the top
performers in addition to placing them on the premium or fast-track career paths that are
usually confidential between the HR manager and the line manager.

Guidelines for How to Conduct Performance Appraisals Professionally

Given these aspects, performance appraisals must be conducted with care and caution.
While good reviews and top performers usually have a pleasant discussion with their
managers, it is the middle ranked employees who often lead to the most intense and difficult
discussions. Indeed, while those at the bottom would have been expecting such reviews or
have resigned themselves to their fates (literally as well as figuratively), it is the employees
who expect their reviews to reflect their performance in the top bracket but, instead are rated
near the top or in the middle who often pose challenges for the managers and the HR
managers.

This is the reason why managers often budget quite some time for such reviews where
they need to convince the employees ranked near the top or in the middle that their ratings are
warranted and justified.

Indeed, such reviews often stretch into multiple rounds because the concerned
employees need much persuasion and convincing to make them agree and consent to the final
rating. Also, sometimes, such reviews often turn bitter and personal, and this is the reason
why some HR managers often make it a point to be present during such reviews to avoid
unpleasant situations from developing.

Above all, our advice to both the employees and their managers is to ensure that such
discussions do not become bitter or personal and it is better to keep such meetings
professional and pleasant irrespective of whether the employees and the managers are “on the
same page” in terms of the contents of the reviews as well as the ratings.

To conclude, performance appraisals form a crucial and critical part of the

employee experience and hence, it is better to conduct them as professionally and as
diligently as possible.
 EMPLOYEE PERFORMANCE REVIEW

EMPLOYEE INFO
EMPLOYEE DEPARTMENT
NAME
EMPLOYEE ID REVIEWER
NAME
POSITION HELD REVIEWER
TITLE
LAST REVIEW TODAY'S DATE
DATE
CHARACTERISTICS
QUALITY UNSATISFACTORY SATISFACTORY GOOD VERY EXCELLENT
GOOD
Works to Full
Potential
Quality of Work
Work Consistency
Communication
Independent Work
Takes Initiative
Group Work
Productivity
Creativity
Honesty
Integrity
Coworker
Relations
Client Relations
Technical Skills
Dependability
Punctuality
Attendance
GOALS
ACHIEVED GOALS SET IN PREVIOUS REVIEW?

GOALS FOR NEXT REVIEW PERIOD

COMMENTS AND APPROVAL

COMMENTS

EMPLOYEE REVIEWER
SIGNATURE SIGNATURE
REFERENCE

https://www.managementstudyguide.com/importance-of-performance-appraisals.htm

https://www.smartsheet.com/performance-review-examples-and-tools