What is Performance Appraisal : 

What is Performance Appraisal In simple terms, performance appraisal may be

understood as the assessment of an individual’s performance in a systematic way, the
performance being measured against such factors as job knowledge, quality and
quantity of output, initiative, leadership abilities, supervision, dependability, co-
operation, judgment, versatility, health and the alike. Assessment should not be
condensed to past performance alone. Potentials of the employee for future
performance must also be assessed. A formal definition of performance appraisal is: It is
the systematic evaluations of the individual with respect to his her performance on the
job and his or her potential for development.

Performance Appraisal Comparison : 

Performance Appraisal Comparison Job Analysis: Describe work and requirement of a
particular job. Performance Standards: Translate job requirements into levels of
acceptable or unacceptable performance
Performance Appraisal: Describe the job-relevant strengths and weaknesses of each
individual

Objectives of Performance Appraisal : 

Objectives of Performance Appraisal Broadly, performance appraisal serves four major
objectives- Development uses, Administrative uses/decisions, Organizational
maintenance/objectives, and Documentation purposes.

Performance Appraisal Process: : 

Performance Appraisal Process: Various Steps involved into process are as follows 1.
Objectives of Appraisal: 2. Establish job Expectation 3. Design Appraisal programme 4.
Appraise performance 5. Performance review 6. Use appraisal Data for appropriate
purposes

Objectives of Performance Appraisal : 

Objectives of Performance Appraisal Data relating to performance assessment of
employees are recorded, stored, and used for several purposes. The main purposes of
employee assessment are: 1. To effect promotions based on competence and
performance 2. To confirm the services of probationary employees upon their
completing the probationary period satisfactorily. 3. To assess the training and
development needs of employees. 4. To decide upon a pay raise where (as in the
unorganized sector) regular pay scales have not been fixed. 5. To let the employees
know where they stand insofar as their performance is concerned and to assist them
with constructive criticism and guidance for the purpose of their development. 6. To
improve communication. Performance appraisal provides a format for dialogue
between the superior and the subordinate, and improves understanding of personal
goals and concerns. This can also have the effect of increasing the trust between the
rater and the rate. 7. Finally, performance appraisal can be used to determine whether
HR programmers such as selection, training, and transfers have been effective or not.

Establish Job Expectations: : 

Establish Job Expectations: The second step in the appraisal process is to establish job
expectations. This includes informing the employee what is expected of him or her on
the job. Normally, a discussion is held with his or her superior to review the major
duties contained in the job description. Individuals should not be expected to begin the
job until they understand what is expected of them.

Design appraisal Programme: : 

Design appraisal Programme: Formal versus Informal Appraisal: The first step in
designing an appraisal programme is to decide whether the appraisal should be formal
or informal. Formal appraisals usually occur at specified time periods- once or twice a
year. Formal appraisals are most often required by the organization for the purpose of
employee evaluation. Informal performance appraisal can occur whenever the
supervisor feels the need for communication. For example, if the employee has been
consistently meeting or executing standards, and informal appraisal may be in order to
simply recognize this fact. Discussions can take to be ensuring that the discussion in
held in private.

Who are Raters? : 

Who are Raters? Raters can be immediate supervisors, specialists from the HR
department, subordinates, peers, committees, clients, self-appraisals, or a combination
of several. Immediate Supervisor is the fit candidate to appraise the performance of his
or her subordinates. There are three reasons in support of this choice. No one is more
familiar with the subordinate’s performance than his or her superior. Another reason is
that the superior has the responsibility of managing a particular unit. When the task of
evaluating a subordinate a given to another person, the superior authority may be
undermined seriously. Finally, training and development of subordinates is an
important element in every supervisor may be the logical choice to conduct the
performance evaluation.

Who are Raters? (Conti.) : 

Who are Raters? (Conti.) Subordinates can assess the performance of their superiors.
The use of this choice may be useful in assessing an employee’s ability to
communication, delegate work, allocate resources, disseminate information, resolve
intra-personal conflict, and deal with employees on a fair basis. But the problem with
subordinate evaluation is that the supervisors tend to become more popular, not
effective leadership, but by mere gimmicks. Peers are in a better position to evaluate
certain facts of job performance that the subordinates or supervisors cannot do. Such
facts include contribution to workgroup projects, interpersonal effectiveness,
communication skills, reliability and initiative. Unfortunately, friendship or animosity
may result in distortion of evaluation. Further, when reward allocation is based on peer
evaluation, serious conflicts among co-workers may develop. Finally all peers may join
together to rate each other high.

Who are Raters? (Conti.) : 

Who are Raters? (Conti.) Clients may be members within the organization who have
direct contact with the rate and make use of an output (good and services) this
employee provides. Interest, courtesy, dependability and innovativeness are but few of
the qualities for which clients can offer rating information. Clients, external to the
organization, can also offer similar kinds of information. Where superiors, peers,
subordinates and clients, make appraisal it is called the 360-degree system of appraisal.

Problems of Rating: : 
Problems of Rating: Performance appraisals are subject to a wide variety of inaccuracies
and biases referred to as ‘rating errors’. These errors occur in the rater’s observation;
judgment, information procession and can seriously affect assessment results. The most
common rating errors are leniency or severity, central tendency, halo effect, rater effect,
primacy and regency effects, perceptual set, performance dimension behavior, spill over
effect and status effect.

What should be rated? : 

What should be rated? One of the steps in designing an appraisal programme is to
determine the evaluation criteria .It is obvious that the criteria should be related to the
job. The six criteria for assessing performance are: 1. Quality: The degree to which the
process or result of carrying out an activity approaches perfection in terms of either
conforming to some ideal way of performing the activity, or fulfilling the activity’s
intended purpose. 2. Quantity: The amount produced, expressed in monetary terms,
number of units, or number of competed activity cycles. 3. Timeliness: The degree to
which an activity is completed or a result produced, at the earliest time desirable from
the standpoints of both coordinating with the outputs of others and of maximizing the
time available for other activities. 4. Cost of Effectiveness: the degree to which the use of
the organizations resources9e.g.human, monetary, technological and material) is
maximized in the sense of getting the highest gain or reduction in loss from each unit or
instance of use of a resource. 5. Need for supervision: The degree to which a job
performer can carry out a job function without either having to request supervisory
assistance or requiring supervisory intervention to prevent an adverse outcome. 6.
Interpersonal impact: The degree to which a performance promotes feeling of self-
esteem, goodwill and cooperation among co-workers and subordinates.

Methods of Appraisal : 
Methods of Appraisal Numerous methods have been devised to measure the quantity
and quality of employees’ job performance. Each of the methods discussed could be
effective for some purposes, for some organizations. None should be dismissed or
accepted as appropriate except as they relate to the particular needs of the organization
or of a particular type or employees. Broadly, all the approaches to appraisal can be
classified into I) Past-oriented methods II) Future-oriented methods

Past-oriented Methods: : 
Past-oriented Methods: Rating scales Checklists Forced choice method Critical incident
method Field review method Performance tests and observations Annual confidential
reports Essay method Cost accounting approach Comparative evaluation approach

Future Oriented tests: : 

Future Oriented tests: Management by objective 360-Degree appraisal Psychological
appraisals Assessment centers

Use of appraisal data: : 

Use of appraisal data: The final step in evaluation process is the use of appraisal data.
The data and information generated through performance evaluation must be used by
the HR dept. In one way or the other, data and information outputs of performance-
appraisal programme can critically influence these coveted employer-employee reward
opportunities. Specifically, the data and information will be useful in the following areas
in HRM: Remuneration administration Validation of selection programmes Employee
training and development programmes Promotion, transfer and lay-off decisions
Grievance and discipline programmes HR planning.