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Performance appraisal is a method of evaluating the behavior of employees in the work spot, normally including both (Q&Q) Quantitative and Qualitative aspects of job performance. A performance appraisal is a regular review of an employee’s job performance and overall contribution to a company. In this the appraiser and appraise are involved, Performance Appraisal is evaluated by comparing the present performance of the employees with the set standard actual performance.

Why Performance Appraisal is required in a Company?

The first and most obvious purpose of employee appraisals is to measure employees’ performance.

  • To make sure employees are working to the required standard
  • To gauge which employees are performing the best and therefore eligible for bonuses, pay rises and other rewards.
  • Using appraisals for employee development

Whether staff is performing well or poorly, employee appraisals present an ideal opportunity for HR to identify the next stage in their development. Many organizations use personal development plans (PDPs) within staff appraisals, to direct and record staff development. You can use PDPs to set development goals that the employee should try to reach before their next appraisal.

  1. Using appraisals to spot potential

Appraisals aren’t just for remedial action. They’re also a moment to sit down with your best-performing employees and to map out their career path. Rather than addressing skills gaps, this may include offering training to develop skills required for promotion.

Appraisals are therefore extremely useful in the talent management process, a major element of which is developing and retaining high-performing employees. Without an effective appraisal system, you might never spot talented individuals who could be the future of your organization.

2. Using appraisals to improve performance

The goals you set in employee appraisals don’t just have to be about staff development. You can also challenge employees to improve their performance, and increase your team’s productivity as a result.

3. Using appraisals to manage changing roles

Almost every job role changes over time, whether because of new technology, new products and services your company introduces, or changes to the size of your team. Employees often need help to understand these changes and how their role is affected.

Why is it Important to conduct Performance Appraisals in an organization?

  1. Performance Feedback: – Most employees are very interested in knowing how well they are doing at present and how they can do better in a future.
  2. Employee Training and Development Decisions: – Performance Appraisal information is used to find out whether an employee requires additional training and development. Deficiencies in performance may be due to inadequate knowledge or skills.
  3. Validation of Selection Process: -Performance appraisal is a means of validating both internal (promotions and transfers) and external (hiring new employees from outside) sources. Organizations spend a lot of time and money for recruiting and selecting employees. Various tools used in the selection process are application blanks, interviews, psychological tests, etc.
  4. Promotions: – Performance appraisal is a way of finding out which employee should be given a promotion. Past appraisals, together with other background data, will enable management to select proper persons for promotion.
  5. Career Development: – Performance appraisal also enables managers to coach and counsel employees in their career development.

METHODS OF PERFORMANCE APPRAISAL

TRADITIONAL PERFORMANCE APPRAISAL METHOD

RANKING METHOD: Ranking method is the simplest method of Performance Appraisal. In this method, all the employees are ranked, the most valuable and efficient employees are ranked first and the least performed employees are ranked as per there performances.

Graphical Method: In this method, the employees are analyzed by calculating their performance’s based on category bases that is EXCELLENT, GOOD, AVERAGE, POOR.

Checklist Method: In this method the checklist is prepared by the subordinates to analyze the performance of the candidates like questionnaire yes/no.

Paired comparison method:  In this method the analyzer analyses the employee’s performance by comparing the two individual employees by comparing who have performed good and finding out the better one.

Group appraisal method: In this method, particular group is analyzed or between two groups are appraise based on their performance, this method helps the organization to know how well the group has performed efficient group employees who have performed well and who have performed least.

MODERN PERFORMANCE APPRAISAL METHOD -ADOPTED BY PRAGNA

360 Performance Appraisal: In this method, the supervisor will be apprising the employees to job related 360 degree.

Human Resource Accounting (HRA): This method plays an vital role to the organization which helps in knowing the profits gained out of human resource. This helps the organization to know whether this HR has gained profit or loss in the process of training and selection process.

Management by Objective (MBO): In this method, the management and employees are included to get a better outcome of objectives and setting of objective and goals need to discuss among management and employees and dividing the work accordingly.

Behavioral Anchored Rating Scale (BARS): This method combines of both graphic and critical incidents method. In this method, the analysis the actual job performed by the employees and the behavior of the employees. In this the company analysis, the behavior in the critical situation, critics are calculated on the bases of behavior. The employee’s behavior is compared with the Behavioral Anchored Rating Scale.

At Pragna, we are comprised of an experienced team of people with experience working at companies such as Microsoft, Siemens, and Wipro. We are very passionate individuals always striving harder to delight our customers and partners.