Performance appraisal

Introduction

Performance appraisal, also known as performance evaluation, is a systematic and periodic process that assesses an individual employee's job performance and productivity in relation to certain pre-established criteria and organizational objectives. It is a fundamental aspect of human resource management, and is used to evaluate an employee's effectiveness, identify strengths and weaknesses, and align individual performance with the overall goals of the organization.

History and Evolution

The concept of performance appraisal has been around for as long as people have been working together in groups. Early forms of performance appraisal can be traced back to the 20th century, when the focus was primarily on merit rating. During the Second World War, the method of performance appraisal evolved into a systematic process, as the military needed to evaluate a large number of personnel.

In the 1950s and 1960s, performance appraisal was used as a tool to determine whether the salary of an employee was justified. The focus was on the employee's traits such as reliability, initiative, and ability to get along with others, rather than on job performance.

The 1970s saw a shift from trait-based appraisals to behavior-based appraisals. This was a significant shift, as it allowed for a more objective evaluation of an employee's performance.

In the 1980s and 1990s, the focus of performance appraisal shifted again, this time to results-based evaluations. This was largely due to the influence of Total Quality Management (TQM), which emphasized the importance of customer satisfaction, and the realization that behaviors and traits do not necessarily guarantee good performance.

In the 21st century, performance appraisal has become a complex and sophisticated process, involving multiple methods of assessment, 360-degree feedback, and the use of technology to facilitate the process.

Purpose and Benefits

The primary purpose of performance appraisal is to provide a measure of an employee's performance. This can be used for a variety of purposes, including:

Identifying areas of strength and weakness
Setting objectives for future performance
Identifying training and development needs
Providing feedback to the employee
Forming a basis for decisions related to pay and promotions
Improving communication between employees and management
Enhancing employee motivation and job satisfaction

Performance appraisal also benefits the organization by providing valuable information that can be used for strategic planning and decision making.

A business professional conducting a performance appraisal with an employee in a formal office setting.

Methods of Performance Appraisal

There are several methods of performance appraisal, each with its own strengths and weaknesses. These include:

Graphic rating scales: This is the simplest and most popular method of performance appraisal. It involves rating an employee's performance on a scale, typically from 1 to 5, with 1 being the lowest and 5 being the highest.

Behaviorally anchored rating scales (BARS): This method involves rating an employee's performance based on specific behaviors that are indicative of effective or ineffective performance.

Management by Objectives (MBO): This method involves setting specific, measurable goals for an employee, and then assessing the employee's performance based on whether these goals have been met.

360-degree feedback: This method involves collecting performance information from a variety of sources, including peers, subordinates, supervisors, and even customers.

Assessment centers: This method involves a series of tests and exercises designed to assess an employee's skills and abilities.

Challenges and Criticisms

Despite its widespread use, performance appraisal has been subject to a number of criticisms. These include:

Subjectivity: Performance appraisal is often criticized for being subjective, as it relies heavily on the judgment of the appraiser.

Lack of objectivity: There is often a lack of objectivity in the appraisal process, as it can be influenced by personal bias, favoritism, or prejudice.

Stress: The process of performance appraisal can be stressful for both the appraiser and the appraisee.

Time-consuming: The process of performance appraisal can be time-consuming, particularly if it involves a large number of employees.

Inaccuracy: There is often a discrepancy between an employee's self-appraisal and the appraisal given by the supervisor.

Despite these criticisms, performance appraisal remains an important tool for managing and improving employee performance.

Conclusion

Performance appraisal is a critical component of human resource management, providing a means for organizations to assess employee performance, identify areas for improvement, and align individual performance with organizational goals. Despite its challenges and criticisms, it remains an essential tool for managing and improving employee performance.