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PERFORMANCE APPRAISAL

Performance appraisal is a key aspect of performance management. It may be


defined as the process of evaluating the performance of employees, sharing that
information with them, and searching for ways to improve their performance.

Functions of Performance Appraisal

Performance appraisal is undertaken for the following reasons:

1. To give employees feedback on performance;


2. To identify the employees developmental needs;
3. To make promotion and reward decisions;
4. To make demotion and termination decisions; and
5. To develop information about the organizations selection and placement
decisions.

Criteria for Performance Appraisal

In performance appraisal, there are certain criteria that are used. The three
most popular sets of criteria are;

1. individual task outcomes;


2. behaviors; and
3. traits.

Individual Task Outcomes. One way of appraising performance is evaluating the


employees task outcomes. For instance, the manager of a bank could be judged on
criteria such as deposit generation and loans collected. In the same light, a credit
investigator could be judged on the number of good accounts that turned out from the
credit applications he investigated and recommended for approval.

Behavior. There are instances when it is difficult to measure an individuals


task outcomes. This is so on advisory jobs or support positions and those who are
assigned to work in a group. Examples of jobs encountering this difficulty are those of
teachers, nurses, and filing clerks. In such cases, management tend to evaluate the
employees behavior. Teachers, for instance, are evaluated according to how well they
manage classroom activities, the quantity and quality of professional training attend,
research output, community service, and the like.

Traits. Many organizations use traits as criteria in appraising employee


performance. This is true even if it is a very weak means. It is weak because it has
little connection with the actual performance of the job. The traits commonly used as
basis for performance appraisal include:

1. good attitude
2. showing confidence
3. being dependable
4. looking busy
5. possessing a wealth of experience

The Process of Performance Appraisal

Performance appraisal is a process in an organization whereby each employee is


evaluated to determine how he or she is performing. It consists of the following steps:

1. establishment of performance standards


2. mutually set measurable goals
3. measure actual performance
4. compare actual performance with standards
5. discuss the appraisal with the employee
6. if necessary, initiate corrective action

Performance standards are those by which performance is to be evaluated. It


should be clearly defined and communicated to the employee. These standards should
be based on job-related requirements derived from job analysis and reflected in the job
descriptions and job specifications. An example of performance standard is: all
customer orders will be filled in 4 hours with a 98 percent accuracy rate.

When goals are set with the active participation of the employees, appraising
employee performance will be an easy task.

Measuring performance is the third step in the appraisal process. To determine


what actual performance is, it is necessary to acquire information about it.
Information may be derived from the following sources.

1. Personal Observation
2. Statistical Reports
3. Oral Reports
4. Written Reports

Methods of Performance Appraisal