Performance Appraisal

Performance Appraisal

1. Definition

   • Performance appraisal is defined by Heery and Noon (2001: 7) as, ‘... the process of evaluating the performance and assessing the development/training needs of an employee’.
   • LRD (1997: 3) similarly note how performance appraisal is, ‘A process of reviewing individual performances against pre-determined criteria or objectives, involving the gathering of information, one or more meetings and some form of report which may include a performance rating’.
   • In sum, then, appraisal is a process that allows for an individual employee’s overall capabilities and potential to be assessed for the purposes of improving their performance.

2. Performance management vs Performance appraisal

   • Definition: Performance Management refers to the processes to ensure the organization connects mission with the work of employees. The activities of performance management include performance appraisal, improvement, and intervention. Performance management involves two related activities: Evaluating the performance of your employees against the standards set for them and Helping them develop action plans to improve their performance.
   • Outcomes: OUTCOMES OF EFFECTIVE PERFORMANCE MANAGEMENT: Clarifying job responsibilities and expectations; Enhancing individual and group productivity; Developing capabilities through feedback; Align behavior the organization mission, values; Providing a basis for making HR decisions; Improving employee-manager communication Providing a basis for making HR decisions
   • Effective performance management depends on the development and implementation of appropriate performance management tools, feedback and documentation.Performance Appraisals or performance reviews guide the process of determining how well employees do their jobs relative to a standard and communicating that information to them. Performance appraisals ensure effective outcomes of performance management are realized.
   • Purposes: Development: creating performance appraisals; Management: planning, organizing and leading appraisals

3. Importance

   • Appraisal can be an integral part of ensuring that organizational members are aware of what is expected of them and can thus play an important part in socializing organizational members to ‘buy in’ to the organizational culture.
   • Improve current performance.
   • Provide feedback: We all seek approval and conformation that we are doing the right thing, and we also like to advise or direct others on how they should do things.
   • Increase motivation.
   • Identify training and development needs.
   • Identify potential.
   • Let individuals know what is expected of them.
   • Focus on career development and succession planning.
   • Award salary increases/performance related pay.
   • Evaluate the effectiveness of the selection process.
   • Solve job problems.
   • Set objectives: Using the SMART mnemonic, specific or stretching (define precisely what is required in clear language), measurable (both quantitatively and qualitatively), accepted (objectives agreed and not imposed), realistic (achievable and fairly allocated) and time-bound (clear target dates).

4. Process

5. Objectives

   • This is an essential first step towards promoting an employee, based on the subjective and objective factors- performance and competency; To identify the training and development needs of an employee; To provide confirmation to those employees who were recently hired and are on their probation period; To take a concrete decision what should be the percentage of hike in the salary of an employee based on the work done by them; To encourage a proper feedback system between the manager and employees; To help employees understand where they stand in the current year and what is the scope of improvement.

6. Methods

   • Traditional
   • Modern

7. Factors affecting performance appraisal

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