Business Perspective: Why performance appraisal is necessary in any organisation

Performance appraisal is a method of evaluating the behaviour of employees in the work spot, normally including both quantitative and qualitative aspects of job performance. It is a systematic and objective way of evaluating both work-related behaviour and potential of employees. It is a process that involves determining and communicating to an employee how the job is done and ideally establishing a plant of improvement. The success of a company requires that both boss and subordinate staff regularly evaluate their on-the-job performance. If they don’t know how well they are doing, then the manager would have missed a key step in developing an environment that will consistently produce cost-effective, high-quality, schedule-beating output. A manager should also make sure that he/she conducts at least an annual performance appraisal with each subordinate. The probability that one will earn consistent promotions, obtain salary increases and lead a successful organization goes up every time you conduct a thorough performance-boosting employee evaluation. Unfortunately, performance appraisals are all too often not done or are conducted without specific references to extraordinary achievements or are held in a setting where constructive results are unattainable. They are rushed and fail to set a positive tone of supervisory interest and concern for subordinate needs. If an evaluation is held it is because it is required by someone higher up the organization. As a result, all parties get it over with as quickly as possible to relieve the pressure of being involved in an unpleasant event. Yet, performance appraisals are necessary. Often a subordinate’s first performance appraisal may occur at the end of a probationary period, anywhere from 30 to 90 days after their start date. It may be informal or formal, documented or undocumented, scheduled or unscheduled. The point is this review, as well as those to follow, have the potential to be the most meaningful opportunities you will have to provide information subordinates can use to improve their performance. Performance appraisal should be a positive experience and contribute to the overall welfare of the organization. If done properly, performance appraisal is a very effective tool to improve performance, productivity and for developing employees. It helps individuals to do better, raises self-esteem and motivation. Above all it strengthens the management / subordinate relationship and fosters commitment. Performance evaluation is not a process to be avoided; rather it should be implemented in all organizations and promoted as a key management activity. The benefits to be realized from a proper evaluation system far outweigh the time and effort required to develop, implement and maintain the process. There is much research to show that individuals have a strong need to know how they are doing and where they stand in the eyes if their managers. Recognizing the importance of performance feedback, it follows that discussions of performance should take place more than once a year. Frequent, regular discussions of performance should occur on an on-going basis and be seen as an opportunity for useful communication between the individual who assigns work and those performing it. These regular meetings serve to provide feedback so good performance is recognized and performance problems are nipped in the bud. The more formal periodic reviews the better, since there will be a summary of what has occurred throughout the reporting period recorded on the official performance evaluation form. Performance appraisal should be viewed as a beneficial process within the context of an effective system of personnel management. It should be accepted as a normal management responsibility to review the performance of all employees and for all managers to discuss performance with their subordinates on a regular basis for the better of the organisation. Ends