Performance appraisal is a process to evaluate an employee’s performance. Management can evaluate a systematic personality process where the employee assessment orally and with written elements such as performance appraisal forms.
Performance appraisal is essential for both the organization and employees. It helps the organize the organization discover employees’ abilities and skills development.
Methods of Performance Appraisal
There are two methods for carrying out the entire process. The traditional methods and modern methods. Each performance appraisal method has its pros and cons; therefore, no single method is accepted by all organizations. Organizations choose optimum methods for the Management to carry out the process effectively.
The oldest and simplest method for performance appraisal is where employees can evaluate by comparing with other employees and ranking them from the best to the worst.
The ranking method is the easiest and simplest method to carry out the entire process but may create problems and issues if conducted on a large scale. The ranking method is always criticized because it is less systematic, and sometimes results look biased.
2. Paired Comparison
The paired comparison method is similar to the ranking method. When you want alterations made, you can use the ranking method to make it effective when conducted on a large scale. At that time, you can use the paired comparison.
Generally, you can compare each employee with the other on one basis. It is usually based on one character.
3. Forced Choice Method
J. P Guilford developed the forced-choice method. Evaluator rates the employees based on the group or pairs of statements by using this method.
In the forced-choice method, evaluators can force you to choose from ready-made statements.
In this method, you can contain both positive and negative statements.
4. Checklist Method
One more method to easily implement the process for appraising the employee. You can use this method for the HR department’s checklist to prepare the employees’ final scores. After that checklist, you can forward it to the Evaluator.
You can prepare the checklist with questions about employee behaviors and job performance. The Evaluator needs to answer the question in YES or NO form.
5. Critical Incidents Method
In this method, the Evaluator analyzes the critical incident in which the employee participated and evaluates them based on their behavior and performance during the incident.
You can not use this method just for the performance appraisal. Can also use it for job interviews. The interviewer can give examples of certain scenarios and ask the interviewee how they would handle such incidents.
6. Essay Method
The Essay method is the simplest method among various available methods. In this method, the Evaluator writes a descriptive essay on employees describing their strengths and weaknesses, nature, etc.
In this method, employees must rely on the Evaluator’s observational and writing skills rather than his performance.
7. Confidential Reports Method
The traditional method can use for appraising the appraisee. It can mainly use in government sectors. The immediate boss or supervisor evaluates to make the promotion effective. Usually, the structured format is use methods, such as strengths, weaknesses, character, attitude, attendance, etc.
It is the most interactive and fair method for performance appraisal, which is also cost-effective. The performance evaluates by the goal set against the objectives by the Management using this method.
You can use the method of management to set the goals and expected outcome for each appraisee which helps to increase performance standards.
The assessment center can use for the executive and potential supervisory evaluations.
This method was first used back in 1930 in Germany by the armed forces to rank their officers. The method gradually spread to the UK and US by late 1940.
360 – Degree Appraisal
In this method, the feedback is taken about an employee from everyone interacting with him during his working hours. They can be his juniors, seniors, supervisors, team members, etc.
This method was first used and implemented in the General Electric Company (USA) in 1992. And now, it is widely used by many major organizations.
Cost Accounting Method
Using this method, you can assess employee performance on the monetary contribution of the employees to the organization. It establishes the relationship between the cost of retaining the employee and the benefits the organization derives from the employee.
Advantages of Performance Appraisal
The performance appraisal helps organizations and Management provide a performance record over time.
It helps the managers select the perfect candidate for any job based on his skills and performance.
Performance appraisal also helps the employees identify areas of weakness that need improvement.
It will create a healthy competition between employees to perform better than their colleagues.
Disadvantages of Performance Appraisal
If the data and the factors used in appraisals are incorrect, then the whole procedure will fail to provide accurate results.
Sometimes the evaluators are not equally qualified to evaluate the appraisees and their abilities. It may lead to cause harm to the organization over some time.
Sometimes the essential factors are left behind or not given equal weightage to those factors while performing the Appraisal.
Process of Performance Appraisal
Setting Up the Criteria.
The First step is to conduct an effective and successful performance appraisal to set the expected standards from the employees. The Evaluator should create the performance appraisal forms that must have a relevant question and meet the organization’s criteria and goals.
Communication With Employees.
Setting up the criteria is not enough to carry out this whole process. Communication with the employees is also the one big essential part of this process to make this process unbiased and ethical.
Measuring The Performance Of Employees.
It is the most important part of this whole process. If the standards and the criteria are well defined, it will be easy to measure them for the Evaluator. There are so many methods for it which we have already discussed.
Comparing The Measurement With Actual Standards.
Once the measurement is done, the next step is to compare it with the existing standards set for performance and evaluate the employee using those standards and criteria. There will certainly be some gaps between the standard set by the organization and the employee’s performance. After comparing it, can fill those gaps by providing feedback and training to the employee, who helps both the organization and the employee in the development and growth.
Once the evaluation and the comparisons are made, the most crucial step is to provide feedback to the employees to do the correct actions if there is any scope for improvement. Also, positive feedback will motivate employees to perform even better.
Sample Performance Appraisal Forms
1) What Does This Template Cover?
The document covers the key factors of appraisal form format like employee details, more than twenty evaluation criteria, detailed calculation of aggregate grade, side-by-side comparison of strengths and weaknesses, identification of training area, recommendations for the promotion, and salary increment.
Suitable For Industries:
It is suitable for the industries where i) evaluation criteria are very broad & ii) regular training is important.
The document covers basic employee details, 3 major ability criteria of skill/knowledge, personality development, and leadership. The maximum weightage of 60% is given to skill/knowledge, and the rest has 20% each weightage. The different flagging is assigned to based on the performance. This sample also includes a self-assessment form which again looks good in evaluating the performance.
It covers the basic information about the employee. This sample is a little mathematical and allows the creation of the evaluation criteria. You can mention your evaluation criteria can set up the scorecard by assigning the weightage you want to define. Also, there is a section where you can summarize the performance review by the appraiser, the employee’s reaction to performance feedback, and the planning for improvement and development.
Suitable For Industries:
This sample is suitable where evaluation criteria are dynamic, and multiple evaluation parameters are applied. A detailed appraiser review and feedback from an employee are required regarding the performance evaluation.