DEFINITION

Performance Appraisal is the systematic

evaluation of the performance of employees
and to understand the abilities of a person for
further growth and development.

OBJECTIVE
Employee
Assessment of
Performance
Personal
Development
Involvement in the
Organization
Work satisfaction.

Organization
Measuring the
efficiency
Maintaining
Organizational
control.
Mutual goal of
Organization &
employee.

WHO SHOULD APPRAISE?

Self
Subordinates
Supervisors
Peers

PURPOSE
Communication:-

-Effective communication between employees and

employers, which helps to maintain trust &
confidence in supervisors.
-It also helps in maintaining cordial and congenial
labour management relationship.
-It develops the spirit of work and boosts the
morale of employees.

 Decision

Making:-helps to analyse strengths and weaknesses of

employees
-tries to give worth to a performance
-It also helps in framing future development
programmes.
Motivation:-

-motivates a person for better job.

-helps him to improve his performance in the future.

TECHNIQUES

Traditional

aditional
Rating Scales
Checklist
Forced Distribution
Critical Incidents
Field Review
Method
Confidential Records
Essay Method
Ranking
Comparison
Graphical Scale

Modern
Assessment centre
MBO
360 Degree
BARS

MODERN METHODS
1.

Assessment Centre:This method tests a candidate in different social

situations using a number of assessor and
procedures. The performance of an employee an
also his potential for a new job is evaluated in this
method by assessing his performance on job related
simulations.

Advantage:- Distractions can be minimized and real proficiency or

potential can be seen
Disadvantage:- it does not reflect the abilities of individuals in real
circumstances of workplace.

2. MANAGEMENT BY OBJECTIVES
(MBO)
An objective must be satisfied SMART conditions:
Specific
Measurable
Achievable
Relevant

and
Time-Specific

Advantage:- supervised & managed activity.

- personal as well as organizational goal can be met.
- save resources & organizational morale can be
increased if goals are managed & achieved.
Disadvantage:- Issue of human neglect, failing to follow the goal.
- Focus is only on goal setting rather than on
developing of the plan.

3. 360 DEGREE
A 360-degree appraisal or "360" incorporates input from
people in different relationships to the employee being
appraised, and not just from the individual's boss.

Advantage:- Appraisals based on input from a variety of colleagues

provide more comprehensive data for review and
development purposes

Disadvantage:- increases the complexity and time investment for

business leaders conducting employee reviews. In
addition, employees may be unwilling to provide
honest opinions of bosses and others of influence due
to fear of retribution.

4. BEHAVIORAL ANCHORED RATING

SYSTEM (BARS)
BARS compare an individuals performance against
specific examples of behavior that are anchored to
numerical ratings.

Advantage:- Greater chance of being accurate.

- Participation of the worker to higher degree.
Disadvantage:- Designing is time consuming.
- Behavior used is more activity oriented.

STEPS TO AVOID PROBLEMS

Use

multi criteria
Minimize trait based evaluation
Train the evaluator
Analyze using OUCH test & Blanchard test:-OUCH stands for Objective, Uniform in application,
Consistent in effect, and Has job relatedness
-With the Blanchard test, does everyone understand
why they are assessed at a specific level (evaluation)
and what it takes to get a higher rating (development)?

REASON FOR FAILURE

Unclear

Objective
Strictness or Leniency
Central Tendency
Biased Appraisal
Pitch Fork Effect
Length of Service Bias
Competitive Appraiser
Recency Error