Impact of future measurements on dispersive HVP

Meaning:

Performance appraisal is the systematic, periodic and impartial rating on an employee’s excellence in matters pertaining to his present job and to his potentialities for a better job. When properly conducted, performance appraisal should not only let the employee know how well he is performing but also influence the employee’s future performance.

Performance appraisal is a method of evaluating the behaviour of employees in the workspot, normally including both the quantitative and qualitative aspects of job performance. It indicates how well an individual is fulfilling the job demands. Often the term is confused with effort, but performance is always measured in terms of results and not efforts.

Performance appraisal is not job evaluation. It refers to how well someone is doing the assigned job. Job evaluation determines how much a job is worth to the organization and therefore, what range of pay should be assigned to the job.

Thus, performance appraisal is a process of estimating or judging the value, excellence or qualities of employees in an organization.

Importance

Performance appraisal has become a very significant activity in most of the enterprises because it provides data about past, present and expected performance of the employees, which is helpful in taking decisions on selection, training and development, increases in pay, transfers and the like. These days a large amount of money is being spent on appraisals by most of the organizations. The following benefits of performance appraisal justify the designing of an effective program of performance appraisal:

 Performance Improvement - Performance feedback provides a scientific basis for judging the merit or worth of employees who will try to improve their performance if it is not up to the satisfaction of the employers.

 Placement Decisions - It is a sound basis for promotions, demotions, transfers or even termination of employees. Often promotions are a reward for past performances.

 Training and Development Needs - It helps in distinguishing between efficient and inefficient workers. Poor performance may indicate the need for retraining.

Likewise, good performance may indicate untapped potential that should be developed.

 Career Planning and Development - Performance feedback guides career decisions about specific career paths one should investigate. It also helps the management to assign work to individuals for which they are best suited.

 External Challenges: Sometimes, performance is influenced by factors outside the work environment, such as family, financial, health or other personal matters. If uncovered through appraisals, the human resources department may be able to provide assistance.

If the appraisal is done scientifically and systematically, it will prevent grievances and develop a sense of confidence among the workers. Thus, appraisal helps in creating a congenial environment of employer-employee relations. administrating a reward and penalty system. It often provides the rational foundation for the estimation of the contributions of employees, and helps to determine the rewards and privileges rationally.

The next important use of such appraisal is that it enables the management to inform the employees where they stand. In other words, it serves as a feedback to the employee. By letting the employee know how well he is doing or where he stands, it tells them what they can do to improve their performance.

A third purpose of such appraisal is to locate or identify the potential for growth of individual employees. By identifying the strengths and weaknesses of an employee, it serves as a guide for formulating a suitable training and development program to improve their quality of work. Also, it helps to determine whether an employee can contribute more in a higher or different job. It helps in their suitable promotion or placement.

Lastly, an analysis of the periodical assessments of all employees provides a fairly dependable connective data on the efficiency of the organizations, state of employee morale etc. to the top management where the appraisals are so structured as to elicit such information.

In a concise manner, we can say that performance appraisals aim at attaining the following different purposes:

 To create and maintain a satisfactory level of performance.

 To contribute to the employee growth and development through training, self and management development programs.

 To help the superiors to have a proper understanding about their subordinates.

 To guide the job changes with the help of continuous ranking.

 To facilitate fair and equitable compensation based on performance.

 To facilitate testing and validating selection tests, interview techniques through comparing their scores with performance appraisal ranks.

 To provide information for making decisions regarding lay off, retrenchment etc.

 To ensure organizational effectiveness through correcting the employee for standard and improved performance and suggesting the change in employee behavior.

The Appraisal Process

Approaches to Performance Appraisal:-Methods/Techniques of Appraisal

1. Traditional Methods 2. Modern Methods

Approaches to Performance Appraisal

Generally speaking, three approaches are used in conducting performance appraisal.

These are:

1. The goal or objective approach- Theoretically, this approach is the simplest and the most satisfying. When there is a goal for the manager- an objective, task, norm or target-in measurable or verifiable form, the appraisal process is simplified to a quantitative comparison of the achievement of the goal or objective. Basically, under this system, specific objectives are established for each position and they are appraised over a specific period of time.

2. The trait or traditional approach- The trait or traditional approach tends to appraise people on personality rather than on performance. The logic behind this approach is the assumption that there are certain qualities, traits etc. present in everyone- some of them are natural, others acquired and cultivated over a period of time. The possession of these traits in varying measures supplies the basis for appraisal. Hence, the scope was limited only to the extent of traits and personality in this approach.

3. The functional approach- This approach to appraisal is based on the thesis that an employer must succeed as an officer or manager. He must be judged by how much and how well he performs the functions of his post- planning, organizing, staffing, directing and controlling. A weightage is decided for the several functions and the employer’s score is recorded against each. The total score gives an index of his rating.

Apart from the above-mentioned approaches, there are two approaches that are collectively known as composite approaches.

These are:

(a) The trait-cum-goal approach (b) The goal-cum-functional approach

These approaches have the combined features of any two approaches. The principle is that the goal has to be reached but through the possession and practice of certain essential traits/qualities and functions.