Performance Appraisal

Topics: 360-degree feedback, Human resource management, Performance appraisal Pages: 33 (9373 words) Published: February 24, 2013
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The performance appraisal system ideally is an organisation designed programme involving both the organisation and the personnel to improve the capability of both. The elements of performance management include: purpose, content, method,appraiser, frequency, and feedback. The appraisal process involves determining and communicating to an employee how he or she is performing the job and establishing a plan of improvement. The information provided by performance appraisal is useful in three major areas: compensation, placement, and training and development. Appraisal helps to improve performance by identifying the strengths and weaknesses; it helps to identify those with a potential for greater responsibility; and assists in deciding on an equitable compensation system. The methods of performance appraisal include rating scale, critical incident, ranking methods, and management by objectives. Several common errors have been identified in performance appraisal. Leniency occurs when ratings are grouped at the positive 7end instead of being spread throughout the performance scale. The central tendency occurs when all or most employees are ranked in the middle of the rating scale. The halo effect occurs when a manager allows his or her general impression of an employee to influence judgment of each separate item in the performance appraisal. A sound appraisal system involves assessing employee performance on a regular basis. Performance appraisal can be done by superiors who rate subordinates, subordinates who rate their superiors, and self-appraisal. A suitable performance appraisal system has to be designed keeping in view the culture and requirements of an organisation. TYPES OF PERFORMANCE APPRAISAL

There are two types of performance appraisal systems which are normally used in organisations: close ended appraisal system,
open ended appraisal system.
Performance appraisal has always been a hot and challenging issue for the managers across the world, HR managers as well as the line managers. These caselets discuss some of the common issues in designing and implementing a performance appraisal system. One of the caselets discusses not just performance appraisal, but the broader issue of performance management. The method of appraising using the balanced scorecard approach has been discussed in the last caselet.

Performance appraisal is a systematic evaluation of present potential capabilities of personnel and employees by their superiors, superior’s superior or a professional from outside. It is a process of estimating or judging the value, excellent qualities or status of a person or thing. It is a process of collecting, analysing, and evaluating data relative to job behaviour and results of individuals. The appraisal system is organised on the principle of goals and management by objectives. Management decisions on performance utilise several integrated inputs: goals and plans, job evaluation, performance evaluation, and individual history. It connotes a two-dimensional concept - at one end of the continuum lies the goals set by the authority, and at the other end, the performance achieved by the individual or any given group. Performance appraisal can be either formal or informal. Usage of former systems schedule regular sessions in which to discuss an employee’s performance. Informal appraisals are unplanned, often just chance statements made in passing about an employee’s performance. Most organisations use a formal appraisal system. Some organisations use more than one appraisal system for different types of employees or for different appraisal purposes. Organisations...
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