Performance appraisal

Introduction :
“performance appraisal includes all formal procedures used to

evaluate personalities and contributions and potentials of group

members in a working organisation. it is a continuous process

to secure information necessary for making correct and

objective decisions on employees.”
- Quote Dale Yoder

in simple words, performance appraisal is the systematic evaluation

of the individual with respect to his performance on the job and his
potential for development. performance appraisal is concerned with
determining the differences among the employees working in the
organisation.
 Objectives of performance appraisal

Administrative Self improvement

objectives objective

1. Transfer
2. Wage and salary
administration
3. Promotion
4. Training and
development
5. Personnel research
Benefits of performance appraisal :

1. A good system of performance appraisal helps the supervisor to

evaluate the performance of employees systematically and periodically.
2. Performance appraisal helps in guiding and correction of employees.
3. Rating can be used as a basis of sound personnel policy in relation to
transfer and promotion.
4. It can be used to evaluate the effectiveness of training programs.
5. Systematic appraisal can prevent grievances and develop confidence
amongst the employees if they are convinced of the impartial basis of
evaluation.
 Methods of performance appraisal

Traditional Modern methods

methods

1. Unstructured appraisal 1. Management by objectives

2. Employee ranking (MBO)
3. Forced distribution 2. Behaviourally anchored rating
4. Graphic-rating scales scales
5. Check list 3. 360 degree appraisal
6. Critical incidents 4. Assessment centers
7. Field review
360 degree appraisal :
The 360 degree appraisal involves rating of an
employee or manager by everyone above,
alongside and below him.
The basic concept in 360
Performance Appraisal makes obvious sense -- soliciting performance
feedback not only from our supervisor but also from our customers,
employees, peers and all whom we interrelate with in the course of
doing our job.

According to Milliman and others,” 360-degree appraisal is the process

of systematically gathering data on a person’s skills, abilities and
behaviours from a variety of sources-the manager, peers, subordinates
and even customers and clients”
Merits of 360-degree appraisal :
 
The merits of 360-degree appraisal are as under :
 
1. The 360-degree appraisal leads to greater self-awareness of those appraised. it
reveals
strength and weaknesses in their working styles.
 
2. The gap between self assessment and the views of one’s colleagues or Peer group
in
reduced.
 
3. It facilitates empowerment of subordinates who get a say in the appraisal of
their bosses.

4. Inflexible managers are forced to initiate self-change.

 
5. Facts about organizational culture and ambience are brought to light by the
multiple
appraisals.
 
Limitations of 360-degree appraisal :
 
The system of 360-degree appraisal suffers from the following
limitations :
 
1. The 360-degree appraisal system ignores performance in terms of goals.
 
2. The candidates being appraised may not accept negative feedback from the
subordinates and
peers. He might feel humiliated.
 
3. Responses from colleagues often tend to biased.
 
4. Linking rewards to findings under 360-degree appraisal can prove to be unfair.
 
5. The subordinates and peers might not be fully competent in appraisal.
 
360 degree appraisal

Appraisal by
superior

Appraisal by Employee self Appraisal by

peers appraisal others

Appraisal by
subordinates
The process of MBO
Setting Organisational and departmental
objective

Goals or targets for subordinates

Check-points or key result areas

Periodic review of progress

Performance appraisal and counselling