Performance Appraisal

“Performance appraisals are a regular review of employee performance within organization”

It is a method which is help full in evaluating the performance of employees of an organization generally in term of quality, quantity, cost and time. It is also very important part of career development. It is regular review of employee's performance within organization.

The history of performance appraisal is brief in the early of 20th century its roots can get to Taylor's pioneering time and motion studies, but this is not that much helpful, the distinct approach appraisal really starts from the time of 2nd world war. The human inclination to judge can cause serious problems there is a less chance that the opinion farm is legal, fair and accurate without a proper planned and structured appraisal system.


  • To identify the gap between desired performance and actual performance.
  • To help management in exercising organizational control
  • To identify the strength and weakness of employees.
  • It gives feedback.
  • To reduce the grievances of employees
  • It also identifies the training needs of employees.

Form a basis for personnel decision.

  • To judge the effectiveness of the other human resource functions of the organization such as recruitment, selection, training and development
  • It also provides opportunity for organizational development and diagnosis.
  • Provide communication platform between employees and administration.

The most famous techniques used to appraise performance are:

360 Degree Appraisal:

It is also known as multi-rater feedback; it is the most comprehensive appraisal where the feedback about the employee's performance comes from all the sources that come in contact with the employee on his job.

Respondent for employees can be managers, peers, subordinates, members of the team, suppliers, customers or any one who can provide valuable feedback about employee's performance at job.

360 degree has four integral parts:

  • Self appraisal: Employee judges his own performance; evaluate his strengths and weakness and also his achievements.
  • Superior's appraisal: where the employees responsibilities and actual performance is rated by superior.
  • Subordinates appraisal: give chance to employees to appraise superiors.
  • Peers appraisal: it evaluates employee's ability to work in a team and sensitivity towards others.

360 Degree Performance Appraisal

It is powerful tool if use after regular interval to keep record of perceptions about employees by others, it is also helpful in evaluating managers while assessing their leadership skills and style.

General Performance Appraisal:

This appraisal method involves the general ongoing communication among the managers and employees throughout the entire year, At the end of the year it will determine that the pre set goals and objectives were met, the feedback will be provided and after reviewing the results new goals will set.

Administrative Performance Appraisal:

The Administrative performance appraisal focuses on the administrative skills than anything else because these employees have specialized tasks and they are judged on the amount of work produced and the quality of work produced and the skills they possess.

Manager Performance Appraisal:

Managers must also be appraised, they must go through the appraisal process, this type of appraisal usually covers both the job skills as well as human resource skills, As managers have the dual responsibility towards employees and towards clients. Most often a managers appraisal will include feedback from team members, usually obtained anonymously.

Employees Self Assessment:

This type of appraisal is most dreaded by employees as no one seems to enjoy rating themselves, most often the self assessment is compared to an assessment completed by the mangers and then discussion regarding the differences follows.

Project evaluation review:

It is a project management tool, instead of waiting for the year end, the employees and the team's performance appraised after the completion of project. This is really helpful to make future planning.

Sales performance Appraisal:

A sales person is simply judged on his result versus his set goals. A managers and salesperson must discuss ways to achieve their goals or changes that need to be made to make them reachable or achievable.

Setting up a performance management and appraisal system:

The element of Appraisal system:

Set Objectives

Decide what you want from employees and agree these objectives with them ,if applicable, set timescale for achieving.

Manage Performance

Give your employees the tools, resources and appropriate training and give them the time scale for achieving objectives.

Carryout the Appraisal

Monitor and observe the performance of employees and than discuss the performance with employees and than set the future targets and goals.

Provide Rewards

Those who performed well must be rewarded. The reward is very important as it motivate them to perform better in future.


In the end it can be concluded that the performance appraisal is the key to the success of any organization, different organization uses different techniques to appraise the performance of their employees which make the employees accountable to their organization, it is kind of watchdog which make them alert all the time, performance appraisal provide motivation to employees that organization is aware of their performance and they will be rewarded for good performance in term of cash reward, promotion or share based scheme etc. it is also kind of warning for bad performers. The appraisal system should be properly planned, organized, properly implemented and controlled to achieve the desired result.


Performance appraisal

Objectives of appraisal

Famous techniques

Elements of appraisal



  4. Thomas F. Patterson Extension Associate Professor and Chair Vocational Education and Technology Department University of Vermont-Burlington
  7. Robert H kent, PHD

Benefits of properly implemented appraisal system


The most important benefit of appraisal system is that, in this busy life the superior and subordinates find very little time to have one on one discussion on important issues which are critical to organization success, and need to be discussed. It is universally accepted that the properly conducted performance appraisal is beneficial for both superior and subordinates. Appraisal provides the opportunity to focus on the organizational goal, find out weaken area's correct existing problems and focused future strategy. When appraisal system used well procedures make things possible that the every person's attention focus on the mission, strategy, vision and the values of the organization. It help to answer two questions which every person asks: what organization expects from me and how I am doing to meeting your expectations and it also differentiate among different level of performance. The most organization use performance appraisal right. They have the full understanding of goals, assuring effective execution, assessing individual performance and deficiencies, identifying and retaining talent and finally rewarding employees on systematic basis.

For many employees official appraisal interview may be the only time they can have with their superiors, so the value of this purposeful meeting between superior and subordinates cannot be underestimated.

Motivation and Satisfaction

Performance appraisal can have savior effects on the motivation and satisfaction level of employees; it can be either better or worse. Appraisal gives to employee's satisfaction that their work is recognized, sometime it is said that negative recognition is better than no recognition at all. Apart from any thing else it encourage individual employees that organization is genuinely interested in his performance and development, this can have very positive influence on his attitude towards his objectives which in turn help to fulfill organizational objectives. Absenteeism and employees turnover may be reduced if more attention were paid to them. So regular performance appraisal is always a good start to achieve that objective.

Training and Development

Performance appraisal provides an opportunity to superior and subordinates to agree that the training needs and development is essential for the organization. During this important discussion of employees' work performance the presence and absence of skills become obvious, especially for those who think that the idea of training is not for them.

Performance appraisal makes training needs more relevant and links it to performance outcomes and future career aspiration. From the whole organizational point of view the consolidated appraisal data form the complete picture of training requirement for whole organization. This data can also be used for different set of variables like departments or genders which is very helpful for organization

Recruitment and Induction

Appraisal data is very useful in evaluating the organizations recruitment and induction practice. For example the employees hired in last two year what is their performance.

It is also very helpful in analyzing the recruitment strategy with the old strategy and the performance of workforce whether it is improving, staying steady on it is declining.

Employee Evaluation

It is sometime denied or underestimated but evaluation is the legitimate and major objectives of appraisal. It is the process by which performance of individual evaluated and examined. It is the right of the organization but some consider that it must b duty,but few who are against it still thinks that it is not good for individuals as it cause more stress and demoralize the employees. Some say that it cannot full fill training and development needs together, it fulfills only one at a time. But their may be a middle ground where employee evaluation and development needs both can be balanced.

Management by Objectives (MBO)

The MBO approach can help to find out few problems that arise as a result of assuming that the employee's traits needed for job success can be reliably identified and measured. MBO approach focus on actual outcomes, employees are judged on actual outcome and not on their potential for success or on subjective opinions. MBO method also identify that it's very tough to dissect all the complex and varied element that use to make up employees performance. The supporter of MBO claims that the employee's performance cannot be broken into parts, but pulls all the parts together to measure and observe the performance


  • Clarity of goal: it should be smart (specific, measurable, achievable, realistic and time bound).
  • The focus should be on the future instead of past.
  • Involving employees in the whole process of goal setting is very helpful in motivating them and increase in job satisfaction.
  • Frequently meeting between superior and subordinates is very helpful for the better communication, coordination and also solved many problems faced during the period.

It concentrates on actual outcomes


In the end it can be concluded that appraisal system is critical for every organization success. It is very helpful for the motivation and satisfaction of the staff, training and development of the staff. Appraisal system is very beneficial for the organization, although it incurs cost but it tells the organization about the human resource capacity of the organization and the required capabilities.

in the final analysis ,managers and organization must realize that there is no perfect appraisal system. The problem is that there seems to be no viable alternative, there is no other management system that has answer to the questions of equitable distribution of organizational rewards.



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