Performance appraisal: Definition, benefits, steps and methods


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Table of Contents

What is performance appraisal?

Companies have employees from different departments, working in sync with each other, doing their own defined job. But it is important to gauge their performances too. Performance appraisal refers to a systematic measurement of the personality and performance of the employees. It is mostly done by their managers or an authority that is an immediate supervisor to them. 

Performance appraisal measures various aspects of employees like skillsets, technical skills, job-role information, personality, punctuality and more. Performance appraisal, sometimes known as performance evaluation or reviewing, helps you bring out what’s best and worst in the employees so that its consequences on the organization can be measured and taken care of.

 Apart from that, managers can also closely observe their team members and decide which employee to give what job. It makes their management easy and work efficient. Managers and supervisors use various tools and technology to carry out performance evaluations.

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Why do you need performance appraisal at your organization?

  • Performance appraisals will allow you to motivate and promote your employees based on their capabilities and performance 
  • It also shows you where your employees are lacking in their skills and knowledge and you can help them fill that gap. 
  • Performance appraisals also help you know the standing of the employees that were recently hired and are on the bench.
  • You can decide how much of a hike to give to a particular employee based on their performance and work efforts. 
  • Performance appraisal also puts in place a regular feedback loop between the manager and employees, so that the employees get reports of their performance. 
  • It also lets the employees evaluate themselves based on where they are now and where they are expected to be.

How to do performance appraisal?

Step 1: You can send in the employee evaluation surveys to the employees. Depending on the organization, the intervals in which performance appraisal is conducted. It can be a month, two months, mostly for most organizations, 6 months does just fine. The HR department sends out the emails to the employees asking to fill out the survey which brings out their experiences and satisfactions.

Step 2: The supervisor or manager under whom the employees work, will have a face to face meeting with each employee and discuss their performance evaluation. They can discuss the previous years performances, figures, skill enhancements and gaps in their performance. 

Step 3: The data that came through the employee surveys is the one that will tell you how they feel about working in your firm and their satisfaction levels. As an organization, you can work to analyze this data and drive out insights and ideas on how to enhance employee experience in your workplace.

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Methods of performance appraisal?

Self evaluation – you can allow the employees to evaluate themselves. It can be fairly used to increase their salaries based on how they have evaluated themselves.

3600 appraisal system – in 360 degree feedback, an employee can be evaluated by one or more people. They can be managers, supervisors, seniors, teammates and colleagues. Once the data from all the sources is gathered, before talking to them in person, the employee’s performance evaluation should be checked first.

Rating scales – we all know how rating scales work. You are given a subject and you can rate it on a scale given ranging from allowed perspective to a higher one, or even vice versa. Same can be done with employee performance. Office managers, supervisors, colleagues can rate employees on certain criterions. The data is numeric and easy to statistically calculate.

Checklist – another common way of surveys. Checklists are nothing but questions implying employee attitude, skillset, personality and other characteristics with managers, supervisors and colleagues filling up the checklist in a way that best describes the employee’s performance.

Essays – as the name tells, employee performance appraisals can also be collected in a long paragraphs manner. It can be pretty descriptive which explains all the needed information about the employee’s performance.

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