Performance appraisal process

Performance appraisal is a management tool used to assess, evaluate and document an employee’s job performance and progress, as well as identify areas for improvement and development. It is a systematic and continuous process of evaluating an employee’s performance in terms of their abilities, skills and competencies, and providing feedback to help employees understand their strengths and weaknesses. Performance appraisals are used to assess job performance, identify strengths and weaknesses, set goals, provide feedback, and provide training and development opportunities.

Example of performance appraisal process

• The performance appraisal process typically begins with a discussion between the employee and their supervisor. The supervisor will review the employee's job responsibilities and performance goals, as well as discuss areas of improvement.
• The supervisor will then conduct an evaluation of the employee's job performance and provide feedback. During this process, the supervisor will assess the employee's strengths and weaknesses, and provide constructive criticism and recommend areas of improvement.
• After the evaluation, the employee and the supervisor will discuss the results and the employee's progress. The supervisor will provide feedback on the employee's performance and areas for improvement.
• Finally, the supervisor and employee will discuss any goals for the upcoming year and create a plan for meeting those goals. This plan may include additional training or development, as well as changes to the employee's job responsibilities.

When to use performance appraisal process

Performance appraisals can be used to assess job performance in a variety of situations, including:

• When hiring new employees - Performance appraisals can help employers evaluate potential candidates and determine who is best suited for the job.
• During probationary periods - Performance appraisals can be used to assess how well an employee is doing during their probationary period and can help employers decide whether or not to move forward with the hiring process.
• During annual reviews - Performance appraisals can be used to assess an employee’s performance over the course of the year and to provide feedback and set goals for the upcoming year.
• During promotions - Performance appraisals can help employers determine which employees are best suited for promotions.
• During termination - Performance appraisals can help employers assess an employee’s performance and provide feedback to assist with their development.
• During training and development - Performance appraisals can help employers assess an employee’s current skills and identify areas for improvement.

Types of performance appraisal process

Performance appraisal process can be divided into several types, each of which is beneficial in its own way. These include:

• Traditional performance appraisals - These appraisals focus on the past performance of an employee, and are usually done on a yearly or biannual basis. The focus is typically on the employee’s job performance, skills, and knowledge.
• 360-degree performance appraisals - This type of performance appraisal involves feedback from multiple sources, such as colleagues, supervisors, customers, and even subordinates. This approach is useful for providing a more holistic view of an employee’s performance.
• Self-assessment - This type of appraisal involves an employee reflecting on their own performance, and is a useful way to identify areas for improvement.
• Online performance appraisals - This type of appraisal involves using technology, such as software or web-based programs, to evaluate and track performance.
• Competency-based appraisals - This type of appraisal is based on a set of specific competencies required for a job. It can be used to assess the proficiency of a person in a certain skill or job-related area.
• Goal-based performance appraisals - This type of appraisal involves setting goals, and assessing an employee’s performance in relation to those goals. It can be used to measure progress and motivate employees to reach their goals.

Steps of performance appraisal process

Performance appraisal process is a system used to evaluate and assess job performance, identify strengths and weaknesses, set goals, provide feedback, and provide training and development opportunities. It is a systematic and continuous process that should involve the following steps:

• Establishing Performance Standards: The first step in the performance appraisal process is to establish clear and measurable performance standards. This includes setting expectations for job performance, as well as outlining any goals or objectives.
• Observation and Documentation: Once the performance standards are set, the next step is to observe and document the employee’s performance. This includes gathering evidence, such as records of employee performance, feedback from colleagues, and assessments from supervisors.
• Evaluation: This stage involves evaluating the gathered evidence to determine the employee’s job performance. This is done by comparing the employee’s performance against the established standards.
• Feedback: The evaluation process should result in providing feedback to the employee. This feedback should be objective and provide areas for improvement as well as recognition for successes.
• Follow-up: It is important to follow-up with the employee to ensure that the feedback has been understood and implemented. This can be done through regular meetings or reviews.
• Training and Development: The performance appraisal process should also involve providing training and development opportunities to the employee. This could include offering additional training or providing resources to help the employee reach their goals.

Advantages of performance appraisal process

Performance appraisal process is a valuable tool used by employers to evaluate employee performance and make decisions about rewarding, developing and retaining employees. It offers a variety of advantages, including:

• Improves Communication - Performance appraisals provide an opportunity for dialogue between managers and employees, and helps foster an effective working relationship.
• Motivates Employees - Performance appraisals help employees to understand their job requirements, set goals, and measure their progress. This can help to motivate employees to perform better and strive for excellence.
• Helps to Identify Training Needs - Performance appraisals can help to identify areas where employees may need additional training and development, allowing employers to invest in areas where it will benefit the most.
• Assists in Employee Retention - Performance appraisals can help employers assess how satisfied an employee is with the job, and identify potential problems or dissatisfaction before they become serious. This can help employers retain valued employees and reduce costly employee turnover.
• Encourages Fairness - Performance appraisals provide a consistent and structured approach to evaluating employee performance, and helps ensure that employees are evaluated fairly.

Limitations of performance appraisal process

Performance appraisal is a management tool used to assess and evaluate employees and their job performance, however, it is not without its limitations. The following are some of the limitations of the performance appraisal process:

• Difficulty in quantifying certain areas of performance: Performance appraisal is often focused on quantifiable results, such as sales figures or customer service ratings, but there are many areas of performance that cannot be easily quantified, such as leadership skills, communication skills, and creativity.
• Subjectivity: Performance appraisals can be subjective and open to personal bias, as they are often based on the opinion of the appraiser and can be influenced by their own personal preferences.
• Lack of consistency: Performance appraisals can lack consistency as different appraisers may have different criteria for evaluating employees, resulting in discrepancies in ratings.
• Focusing on the past: Performance appraisal often focuses on past performance, which can be difficult to accurately measure.
• Poorly structured feedback: Performance appraisal feedback can be poorly structured and ineffective, leading to employees not understanding or utilizing the feedback they receive.
• Time consuming: Performance appraisal can be time consuming, and if it is not done correctly, it can be a waste of time.
• Resistance to change: Performance appraisal can be resisted by employees if they do not believe in its relevance or value.

Other approaches related to performance appraisal process

Performance appraisal is a management tool used to assess, evaluate and document an employee’s job performance and progress. There are several approaches related to the performance appraisal process, such as:

• 360-Degree Feedback: This approach involves collecting feedback from the employee’s peers, supervisors, and direct reports to provide a well-rounded assessment of the employee’s performance.
• Competency-Based Appraisal: This approach evaluates an employee’s performance against predetermined competencies or standards.
• Forced Ranking: This technique involves ranking employees against each other in terms of performance.
• Balance Scorecard: This method evaluates an employee’s performance on a set of predetermined criteria or goals.

In summary, performance appraisal is an important management tool used to assess and evaluate an employee’s job performance and progress. There are several approaches related to the process, such as 360-degree feedback, competency-based appraisal, forced ranking, and balance scorecard. Each approach provides a different assessment of the employee’s performance and can help to identify areas for improvement and development.

Performance appraisal process — recommended articles

Performance appraisal systems — Skills and abilities — Strategic human resource — Training and development — Peer appraisal — Management by objectives steps — Monitoring of performance — Merit rating — Strategic human resource management

References

• DeNisi, A. S., Cafferty, T. P., & Meglino, B. M. (1984). A cognitive view of the performance appraisal process: A model and research propositions. Organizational behavior and human performance, 33(3), 360-396.