Introduction to Performance Appraisal

In almost every organization, every employee is subjected to periodic  appraisal of his/her performance. This is highly important if the organization’s  human resource development objectives are to be realized, if the organization  wants to make best use of its human resource available and if the organization  wants to have a scientific and retinal compensation system. An effective  performance appraisal system brings rationality in management. If an  organization wants to maximize its effectiveness then the organization must  have tool by which it can discriminate between an effective employee and not so  effective employee. Today, appraisal is not something of a choice left to the  wishes of the corporate bosses, nor it is a privilege to be enjoyed by few  businesses conglomerates.

performance appraisal or performance review or performance evaluation

Therefore, it is a must for every organization for its survival and growth.  The appraisal practices are in somewhere structured and formally sanctioned and  in other instances they are an informal and integral part of daily activities. Thus,  across the human activities someway or other performance appraisal is  conducted in different ways and all of us, consciously or unconsciously evaluate  our own actions from time to time. In social situation, performance is conducted  in a systematic and planned manner to achieve various organizational goals in  social system.

Read More:

  1. Performance Appraisal
  2. Objectives of Performance Appraisal

Background of Performance Appraisal

Performance appraisal is not something new. The appraisal system  existed in early centuries, though the nature of appraisal was not so formal  and the tools used were not so scientific. In fact the appraisal gained momentum  in the post Second World War period with the advent of professionalization in  management. At the early stages the performance appraisal was done just on the  basis of the degree to which a person possessed certain traits, which were  considered essential for effective performance of a particular task. Performance  Appraisal of individuals, groups and organizations is common practice of all  societies.

The history of performance appraisal is quite brief. Its roots in the early  20th century can be traced to Frederick Taylor’s pioneering time and motion studies. But  this is not very helpful, for the same might be said about almost everything in  the field of modern human resources management. As a distinct and formal  management procedure of evaluation of work performance, appraisal system  was used dates from the time of the Second World War. Yet in a broader sense,  the practice of appraisal of employee’s performance in different work places is a  very ancient art. Appraisal, it seems,  is both inevitable and universal for human activities. In the absence of a  carefully structured system of appraisal, people will tend to judge the work  performance of others, including subordinates, naturally, informally and  arbitrarily.

The human inclination to judge can create serious motivational, ethical  and legal problems in the workplace. Without a structured appraisal system,  there is little chance of ensuring that the judgments made will be lawful, fair,  defensible and accurate. Performance appraisal systems began as simple  methods of income justification. That is, appraisal was used to decide whether or  not the salary or wage of an individual employee was justified. The process was  firmly linked to material outcomes. If an employee’s performance was found to  be less than ideal, a cut in pay would follow. On the other hand, if their  performance was better than the supervisor expected, a pay rise was in order. As  a result, the traditional emphasis on reward outcomes was progressively  rejected. In the 1950s in the United States, the potential usefulness of appraisal  as tool for motivation and development was gradually recognized. The general  model of performance appraisal, as it is known today, began form that time.

Read More:

  1. Importance of Performance Appraisal Systems
  2. Benefits of Performance Appraisal
  3. Common Mistakes in Performance Appraisal

Concept of Performance Appraisal

In the context of an industrial organization, performance appraisal is a  systematic evaluation of personnel by supervisors or those familiar with their  performance. In other words, performance appraisal is a systematic and  objective way of judging the relative worth or ability of an employee in  performing his/her task.

Many authors described and some of them were tried to define the  concept of performance appraisal in their own way.

According to Dale Beach,

“Performance appraisal is the systematic  evaluation of the individual with regard to his or her performance on the job and  his potential for development”.

According to Gary Dessler,

Performance appraisal is an evaluation of employee’s current or past  performance relative to his/her performance standards. Further he mentioned  that the appraisal process involves three steps;

  1. Setting work standards,

  2. Assessing the employee’s actual performance relative to these  standards, and

  3. Providing feedback to the employee with the aim of motivating that  person to eliminate performance deficiencies or to continue to perform  above par.

McGregor discusses the formal performance appraisal plans in view of  meeting three needs. Out of which one is relating to organization and other two  for individual. The first one, organization level, is to provide systematic  judgments to back up salary increases, transfers, demotions, or terminations. The  other two, individual level, are relating to certain means which are meant for  subordinate to tell subordinate how boss is doing, and suggesting needed  changes in behavior, attitudes, skills or job knowledge. Make subordinate to  know the level of performance standards and the superior uses them as a base  for coaching and counseling the individual employee.

Performance appraisal may be defined as a structured formal interaction  between a subordinate and supervisor, that usually takes the form of a periodic  interview (annual or semi-annual), in which the work performance of the  subordinate is examined and discussed, with a view to identifying weaknesses  and strengths as well as opportunities for improvement and skills development.  Appraising the performance is method of evaluating the behavior of  employees in the work spot, normally including both the quantitative and  qualitative aspects of job performance. Performance refers to the degree of  accomplishment of the tasks that make up an individual’s job. It includes how  well an individual is fulfilling the job demands. In order to find out whether an  employee is worthy of continued employment or not, and if so, whether he  should receive a bounds, a pay rise or promotion, performance needs to be  evaluated form time to time. It is by and large useful for not only for the  different payments purpose but also to make aware of once strengths and  weaknesses. So that employees can able to understand that in which area they  are suppose to improve their performance. Under this exercise evaluation is not  only the performance of worker on the job but also employee potential for  development for future expecting job roles. Moreover performance appraisals  should focus on wok planning and continuous review for development. They  should also focus on quality to survive in the current environment.

Every organization has to decide upon the content to be appraised before  the programme is approved. Generally content to be appraised is determined on  the basis of job analysis. Contents to be appraised in the form of contribution to  organizational objectives like production cost saving return on capital so on.  Other measures are based on; behavior which meaner observable physical actions  and movements, objectives which measure job related results like amount of  deposits mobilized, and traits which measures in terms of personal characteristics  observable in employee’s job activities. The contents to be appraised may vary  with the purpose of appraisal and type and level of employee. There are different  methods designed and experimented in this regard.

Read More:

  1. Methods of Performance Appraisal
  2. Traditional Methods of Performance Appraisal
  3. Modern Methods of Performance Appraisal
  4. 360-degree Performance Appraisal

Credit: Performance Management-MGU

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