Performance Appraisal Methods

Performance appraisals are carried out by the HR department of the companies in order to evaluate the
performances of its employees and to bring about improvement in them. Here we have discussed about
some effective performance appraisal methods.
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Performance appraisal is an integral
part of performance management.
Usually, it is done once in a year.
Apart form improving the employee performance upto its maximum potential, it has several other
benefits. Like, it is a kind of feed back given to the employees by the employer, it gives the
employees an opportunity to communicate with the employer. Also, the employee becomes aware
of the roles, responsibilities and expectations of the employers through these performance
appraisals. It helps the employers to recognize the competency levels of the employees. The
employers come to know if there is requirement for any further employee training through
performance appraisals. It is also useful in deciding on the allocation of rewards to the employees,
according to their performance like salary hike or promotions. There are various types of
performance appraisal methods that are used by different companies. To know more read on
performance appraisals.
Performance Appraisal Based on Ranking
In this method, the performances of all the employees are compared with one another and not to
any definite standard measurement. The performances are represented graphically where they
are ranked in the range of best to worst as per their performances. Usually, maximum number of
employees are found in the middle of the curve, as it represents employees with an average
performance while the best and the worst performers are at the either ends of the curve. This
method helps to choose the best performer among the best of the performances. This method is
applicable only on those employees who are doing the same kind of job. The disadvantage of this
method is that it can trigger off rivalry among its employees, which may adversely affect the
working environment. Moreover, a negative performer is labeled as a loser in this method which
may affect the motivation of the concerned employee.
Performance Appraisal Based on Rating
Here evaluation of the performance is based upon certain traits of the employees. Some of the
key traits that are included for this purpose are employee motivation, attitude, flexibility, quality of
work, quantity of work, cooperativeness, participation in team work and so on. Every employee is
graded on each of these traits. Usually, it is done objectively by yes/no or
satisfactory/unsatisfactory check boxes. The disadvantage of this method is that there is no
specific definition for any given trait. Evaluation of a particular trait can vary from one person to
the other. This may create confusion among the employees and give rise to tension between the
employee and the employer.
Performance Appraisal Based on Behavior
Also known as behaviorally anchored rating scales. It is slightly different from any other job
performance appraisal methods. As the name suggests, the performance is rated from best to
worst according to the behavior pattern required for a given job. However, it does not take into
account the trait and personality factors. All the dimensions of job behaviors that are relevant for a
particular job has to be included in the scale and thus, a clear standard is developed. For this kind
of analysis, thorough knowledge of the job behavior, required for a specific job is a must.
However, this is a slightly complicated as well as time consuming process because for each type
of job, a suitable scale has to be constructed.
Topics
Performance Appraisals
Employee Incentives
Employee Management
Employee Motivation
Employee Performance
Human Resources
Key Performance Indicators
(KPI)
Performance Management
Salary Negotiation
Career Development
Employee Training
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Performance Appraisal Based on Objective
This method is called Management by Objectives (MBO). In this method, certain goals and
objectives are set by the employer after discussing them with the employees. The performance of
the employees are evaluated periodically after they submit their status report from time to time.
When there is a specific set of goals, the employee feels motivated and puts in the best possible
efforts to achieve the goals. This method often helps in obtaining higher levels of performances
from the employees. The disadvantage of this process is that in a way, every employee starts to
outperform the other which may result in an non cooperative atmosphere in the work place and in
turn affecting the productivity.
There is one narrative based performance appraisal which is used along with other performance
appraisal methods. For this, the HR manager as well as the employee give written statements on
the performance of a particular employee. It can be done in two different ways. Either they can
write whatever they wish to or there could be some given set of questions which needs to be
answered by both. You can also refer to 360 degree feedback - multisource feedback.
One cannot say which type of the performance appraisal method is the best. One method that is
suitable for a company may not be right for others. To a great extent, it depends on the system
prevailing in the company. Sometimes, companies use more than one of these methods for better
analysis of their employees.
By Bidisha Mukherjee
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