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 Meaning

 Objectives
 Benefits
 Characteristics
 Uses
 Process
 Limitations and Barriers
 Performance Appraisal is the systematic,
periodic and an important rating of an
employee’s excellence in matters pertaining
to his present job and his potential for a
better job.
 Assessing the performance and progress of
an employee on a given job and for future

 Enable the employees to achieve superior

standards of work performance.

 Help the employees to identify the

knowledge and skills required for performing
the job efficiently
 Promoting a two way system of
 clarifying expectations
 communicating the functional and organizational
 providing a regular and a transparent feedback
 continuous coaching
 Identifying the barriers to effective
performance and resolving those barriers
through constant monitoring, coaching and
development interventions.
 Administrative decisions strategic planning,
succession planning, promotions and
performance based payment.

 Promoting personal growth and Advancement

in the career of the employees by helping them
in acquiring the desired knowledge and skills

 Encouraging employee empowerment,

motivation and implementation of an effective
reward mechanism.
 For the Appraisee
 Increased motivation and job satisfaction.
 Clear understanding of what is expected and what
needs to be done to meet expectations.
 Opportunity to discuss aspirations and any guidance,
support or training needed to fulfill these aspirations.
 Improved working relationships with the superior.
 Opportunity to overcome the weaknesses by way of
counseling and guidance from the superior.
 Increased sense of personal value as he too is involved
in the appraisal process
 For the Appraiser
 Opportunity to develop an overview of individual jobs.
 Opportunity to identify strengths and weaknesses of
 Increased job satisfaction.
 Opportunity to link team and individual objectives with
department & organizational objectives.
 Opportunity to clarify expectations that the manager has
from teams and individuals.
 Opportunity to re-prioritize targets.
 Means of forming a more productive relationship with
staff based on mutual trust and understanding.
 Due to all above increased sense of personal value
 For the company:
 Improved performance throughout the organization
due to:
▪ Increased sense of cohesiveness and loyalty.
▪ Managers are better equipped to use their leadership
skills and to develop their staff.
▪ Effective communication of organization’s objectives
and values.
 Improved overview of tasks performed by each member
of a group.
 Identification of ideas for improvement.
 Creation and maintenance of a culture of continuous
 Communication to people that they are valued.
 Performance appraisal is a process.
 Systematic examination of the strengths and
weakness of an employee in terms of his job.
 Scientific and objective study.
 Formal procedures are used in the study.
 It is an ongoing and continuous process
 The main purpose of performance appraisal is
to secure information necessary for making
objective and correct decision of an
 Performance improvement through performance


 Compensation adjustments through performance


 Placement decisions promotions, transfers and

demotions based on performance .

 Training and development needs are identified

 Career planning and development

 Job design errors

 Equal employment opportunity

 External challenges

 Feedback to human resources

Establishing Communicatin
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Action appraisal
 Errors in Rating
 Lack of reliability
 Negative approach
 Multiple objectives
 Lack of knowledge
1. Faulty Assumptions
▪ No Fair And Accurate Appraisals
▪ Particular Appraisal System Forever
▪ Personal Opinion Is Better Than Formal
▪ Employees Want To Know Frankly
2. Psychological Blocks
▪ Feeling Of Insecurity,
▪ Appraisal As An Extra Burden
▪ Disliking Of Communicating Poor Performance
3. Technical Pitfalls
 Criterion Problem
▪ The Standard Of Performance Used To Compare
The Actual Performance
 Distortions
▪ Occurs In The Form Of Biases And Errors In
Making The Evaluation
▪ Halo Effect
▪ Central Tendency
▪ Constant Errors
▪ Rater's Liking And Disliking
 Traits approach
 Result approach
 Behavior approach
 Emphasizes the individual performer rather
situation, behavior and results
 Include abilities or personality
 Limitations
 Traits are beyond the control of an individual
 Presence of traits does not give 100%
 Emphasis on how and what employee will do
on the job
 Process oriented approach
 Appropriate where
 The link between behavior and results is not
 Outcome occur in the distant future
 Poor results are due to causes beyond the
performers control
 Bottom line approach
 Less time to define measuring criteria
 cost effective
 Results of this approach are objective
 Appropriate where
 Workers are skilled in the needed behavior
 Behaviors and results are related
 Results show consistent improvement over time
 There are many ways to do the job right
 Essay appraisal method  Management by objective
 360 degree appraisal
 Straight ranking  Assessment centers
methods  Behaviorally Anchored
Rating scale (BARS)
 Paired comparison  Behavior observation scale
 critical incident method (BOS)
 Human resource
 Field review accounting
 Check list method  Competency models
 Graphical rating scale  BSC
 Forced distribution  HR Score Card
 Past oriented
 Future oriented
 Result oriented
 Traits oriented
 Behavior oriented
 One person
 Multi person
 Other
 Traditional
 Modern
 Similar to BARS
 Based on critical incidents
 Measure how frequently behavior has been
 Appraiser as an observer than a Judge
 Constructive feedback