Running head: PERFORMANCE APPRAISAL 1

Challenges involved in Performance Appraisal

Name

Institution
PERFORMANCE APPRAISAL 2

Outline

Introduction........................................................................................................................3

Challenges involved in Performance Appraisal.................................................................4

Personal bias..................................................................................................................4

Poor Assessment............................................................................................................4

Halos and Horns Effect..................................................................................................5

Employee Resistance.....................................................................................................5

Lack of Competence......................................................................................................6

Determination of the Appraisal Criteria..........................................................................6

Factor of Time and Cost.................................................................................................7

Annual Performance Appraisals.....................................................................................7

Political mask..................................................................................................................7

Conclusion.........................................................................................................................8

References.......................................................................................................................10
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PERFORMANCE APPRAISAL

Introduction

Performance appraisal is a function, within the performance management

system, carried out by human resource managers to review an employee’s performance

within an organization. The employees are the key stakeholders in an organization and

the success of their individual goals are paramount to the development of any business

organization. Performance appraisals weigh the knowledge and skills of employees

against the achievement of individual and organizational goals (Nurse, 2005). It is

necessary for every organization to carry out performance appraisal for its employees

as it helps in identification of areas that need adjustment and improved professional

growth. The assessment of an employee’s performance gives an insight on their job

knowledge, quality of work, productivity, dependability, attendance and punctuality,

relationship with other employees, adherence to rules and procedures, supervisor

ability, among other performance attributes (Beer, 1981). Feedback resulting from the

performance guides in modification and adjustment of norms in order to shape the

behavior of workers in a desired direction. This includes activities such as mentoring

programs, positive reinforcement, counselling and rewarding best performing

employees. Constructive use of performance appraisals ensures cohesiveness amongst

employees, improved performance of roles and responsibilities and thereby bringing

about realization of the organizations development goals and objectives (Rusli & Nur,

2004).
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Challenges involved in Performance Appraisal

The process of performance appraisal faces numerous challenges. Feldman

(1981) attests that performance appraisal is one of the most difficult tasks in the

manager’s jurisdiction. Challenges encountered in the process of performance

appraisals revolve around the purpose of the appraisals, attributes of examination, and

the contribution of the appraisal to the development of an organization.

Personal bias

Personal bias is the biggest challege in carrying out performance appraisals

within any organization. Personalities of both supervisors and employees influence the

performance appraisal. This substitutes the organization’s standards within the

evaluation procedures. Supervisors mostly tend to fall prey of subjectivity rather than

the objectivity of the employee in attaining organizational goals. Subjectivity leads to

unfairness in the formulation of the evaluation decisions. This is termed as biasness and

it reduces the motivation and innovativeness of employees. The qualities of good

employers require them to have unbiased employed as well as appraisal policies,

motivational approaches towards employees, good pay schemes and incentive policies.

These attributes help an organization to minimize turnover rates and capitalize on

maximizing the present employees’ capabilities of growing their career paths within the

framework of achieving the organizational goals (Beer, 1981).

Poor Assessment

This is another challenge faced during performance appraisal. Many

organizations pay little or no attention to the knowledge of managers on the assumption

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that, being the bosses, they have adequate awareness of the organizations expectancy

in conducting evaluation of the employees. Inadequate managerial training regarding

the requirements of the employees’ assessment leads to improper implementation of

many appraisal programs (Wong and Snell, 2003). Poor assessment of individual

performance results to discontented employees within an organization. This further

leads to misunderstanding amongst the supervisors and the employees and such

circumstances adversely affect the achievement of the performance goals of an

organization. It is always in order that knowledgeable supervisors carry out evaluation

procedures (Nurse, 2005).

Halos and Horns Effect

This refers to the manager’s assumption that an employee, by nature, is

competent or non-competent in the performance of assigned tasks in an organization.

More specifically, halo effect refers to a situation where a manager or supervisor may

give credit to an employee based upon some previous good performance without giving

attention to current performance trends. On the other hand, the horn effect is a

contrasting phenomenon to the halo effect where a manager may underrate the

performance of an employee due to previous failure in duty. In general halo and horn

effects result in errors in rating and evaluation of the employees’ abilities (Nurse, 2005).

Overestimation of an employee’s performance creates false impression since the

employees assume good performance that shields them from improvements. In

contrast, underestimating the performance of employees lowers their self-esteem. This

is very detrimental in the development of both personal and organizational goals.

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Employee Resistance

The outcome of the performance appraisal enables employees to know their

strengths and weaknesses in the performance of duty. In most cases, employees resist

the appraisal process in the dilemma of negative outcome on their performance.

Employees should be given clear information on the purpose of the appraisal and

measuring standards communicated stating the expectations of the organization from

the employees (Nurse, 2005). Those with positive results should be rewarded through

promotions, wage increment and incentives, whereas employees with negative results

should be equipped with adequate knowledge through training.

Lack of Competence

In some cases, managers exhibit poor leadership and managerial competence.

Leadership styles in any organization determine the accomplishment of both personal

and organizational goals. Apparently, this influences the design and process of the

performance appraisal (Rusli and Nur, 2004). For instance, autocratic leaders tend to be

more authoritative in nature and thus their decisions control the entire process of

performance appraisal, whereas a democratic leader creates a sensible battleground for

every employee and enhances involvement and good relations in every aspect of the

performance appraisal. According to Rusli and Nur (2004) laissez-faire leaders create

an havoc environment since they exhibit less commitment and generally have

inadequate skills to ensure cohesiveness of organizational objectives. Their trend of

carrying out performance appraisals turns out to be inefficient.

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Determination of the Appraisal Criteria

Rusli and Nur (2004) hold that a variety of appraisal approaches used in

organizations have their credits as well as discredits and there are no wrong or right

approaches meant for evaluation. However, consistent use of these approaches help

managers to manipulate their successfulness. Appropriate appraisal techniques judge

correct results on employees’ achievement of personal and organizational goals.

Managers have the mandate to choose the suitable appraisal methods to evaluate their

employees (Rusli and Nur, 2004). Use of inappropriate evaluation methods lead to false

results on the employees’ accomplishments of organizational goals. This results in

demotivation and downward growth in their performance areas within the organization.

Emphases on specialization areas help determine the correct approach for a particular

evaluation. Beer (1981) classifies performance appraisal measurement into three

groups namely; measuring units, behaviors and results. The most commonly used

method is the assessment of an employee’s trait that entails a closer examination into

his/her personality. Behavioral oriented evaluation gives an insight on how the

employee relates with colleagues whereas the result based approach gives overall

contributions to an organization.

Factor of Time and Cost

Time and cost are the major factors that limit the use of some appraisal

techniques that produce the best results. Performance appraisal requires the evaluator

to maintain a proper track of each employee by writing reports and documenting (Rusli

and Nur, 2004). In addition, long assessment forms usually require more time to fill in

evaluation details and thus are avoided; and yet they provide detailed information on the
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performance of the employee. In addition, appraisals depend on the area of

specialization of an employee in an organization. Thus, appraisal forms are custom

made to avoid generalization that may result in inadequate evaluation of an employee.

This requires more time to design appraisal forms for different employees within an

organization set up. In some cases, managers find it easy to repeat an evaluation

activity using previous appraisal forms instead of formulating new ones that encompass

any new changes within the organization (Wong and Snell, 2003).

Annual Performance Appraisals

Most performance appraisals within organizations are carried out on an annual

basis. This leads to inaccurate review of the employees’ performance (Beer, 1981).

One-year cycle appraisal systems lead to ineffectiveness and inconsistency of

employees performance records since they take place within a specified period of an

organizations business calendar. This may leave important short-term performance

goals as it only captures the ongoing performance of an employee at the time of

appraisal. According to Beer (1981), annual evaluation reduces the foreseen value of

the entire appraisal process.

Political mask

Political mask in performance appraisals also affect its effectiveness. According to Rusli

and Nur (2004), many managers willingly manipulate performance appraisals for

political purposes. The design of such performance appraisals leaves very crucial

assessment procedures in order to suit certain political interests. This depicts that a

manager purposefully carries out a performance appraisal that does not actually
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address the prevailing needs of the organization to build the careers of the employees

in the achievement of the organizational goals. These appraisals supersede the need

for accuracy and adhere to fashioned evaluation method, which addresses the exact

interest of the appraisal and thereby giving false results about the performance of

employees. The implementation of such outcomes hinders the growth of individuals and

organizations (Rusli and Nur, 2004). Managers are required to create a clear balance

between political, financial and development issues relating to the structures of the

organization.

Conclusion

The workability of a performance appraisal is critical for organizations.

Evaluation of an organizations workforce helps in determining the weaknesses and

strengths within the organizations developmental framework. A successful performance

appraisal gives a clue in the design of new policies and procedures aimed at the

development of organizational goals. As mentioned earlier, employees are amongst the

key stakeholders in any organization. In order to realize the capabilities and

competencies of employees the appraisal procedures used in evaluation should not

only focus on the task performance but also put more stress on personal development

of individual employees (Wong and Snell, 2003). The evaluation process should be well

structured capturing both the design and the process of implementation and

maintenance as stated in the performance management policy of the organization.

According to Wong and Snell, timely feedback to employees should be given priority.

This gives employees adequate time to adjust to changes, which may have resulted in

the event of the appraisal. Time to time training and learning helps managers develop
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sound appraisal programs with fewer strategic and operational errors. Standard

performance appraisals leave room for review and adjustment to accommodate current

challenges and issues within the dynamic set up of an organization. This improves

effectiveness of the appraisal outcomes for individuals and organizations.

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References
Beer, M. (1981). Performance appraisal: dilemmas and possibilities. Organizational

Dynamics, 9(3), 24 – 36. Retrieved August 24, 2007, from Business Source

Premier Database, http://search.epnet.com

Feldman, J. M.(1981),” Beyond attribution theory: Cognitive processes in performance

evaluation”. Journal of Applied Psychology, 66, 127-148.

Nurse, L. (2005). Performance appraisal, employee development and organizational

justice: exploring the linkages. The International Journal of Human Resource

Management, 16(7), 1176 – 1194. Retrieved July 31, 2007 from Taylor & Francis

Journals Database, http://www.informaworld.com

Rusli Ahmad and Nur Azman Ali (2004) “Performance appraisal decision in Malaysian

public service”. International Journal of Public Sector Management. Vol. 17 (1)

pp. 48 – 64.

Wong and Snell (2003),”Employee Workplace Effectiveness: Implications for

Performance Management Practices and Research”, Jounal of General

Management, Vol 29 , No 2