What Is a Performance Appraisal?The term performance appraisal refers to the regular review of an employee's job performance and overall contribution to a company. Also known as an annual review, performance review or evaluation, or employee appraisal, a performance appraisal evaluates an employee’s skills, achievements, and growth, or lack thereof. Show
Companies use performance appraisals to give employees big-picture feedback on their work and to justify pay increases and bonuses, as well as termination decisions. They can be conducted at any given time but tend to be annual, semi-annual, or quarterly. Key Takeaways
How Performance Appraisals WorkPerformance appraisals are usually designed by human resources (HR) departments as a way for employees to develop in their careers. They provide individuals with feedback on their job performance. It ensures that employees are managing and meeting the goals expected of them, giving them guidance on how to reach them if they fall short. Because companies have a limited pool of funds from which to award incentives, such as raises and bonuses, performance appraisals help determine how to allocate those funds. They provide a way for companies to determine which employees have contributed the most to the company’s growth so companies can reward their top-performing employees accordingly. Performance appraisals also help employees and their managers create a plan for employee development through additional training and increased responsibilities, as well as to identify ways the employee can improve and move forward in their career. Ideally, the performance appraisal is not the only time during the year that managers and employees communicate about the employee’s contributions. More frequent conversations help keep everyone on the same page, develop stronger relationships between employees and managers, and make annual reviews less stressful. Types of Performance AppraisalsMost performance appraisals are top-down, meaning supervisors evaluate their staff with no input from the subject. But there are other types:
There are many performance appraisal apps developed to help companies automate the evaluation process. Criticism of Performance AppraisalsPerformance appraisals are designed to motivate employees to reach and/or exceed their goals. But they do come with a lot of criticism. An issue with performance appraisals is that differentiating individual and organizational performance can be difficult. If the evaluation's construction doesn't reflect the culture of a company or organization, it can be detrimental. Employees report general dissatisfaction with their performance appraisal processes. Other potential issues include:
What Are Performance Appraisals Used for?Performance appraisals are used to review the job performance of an employee over some period of time. These reviews are used to highlight both strengths and weaknesses in order to improve future performance. When Should a Performance Appraisal Take Place?Performance management is an ongoing process. Throughout the year, managers are encouraged to engage with employees to establish goals, note progress, and provide feedback. Formal reviews or appraisals often take place on a yearly or quarterly basis. What Is a 360-Degree Appraisal?Standard performance reviews include an employee and their manager or supervisor. The 360-degree version also solicits input from the employee's colleagues or coworkers. What do you call the process of evaluating employee performance?A performance evaluation, also called a performance appraisal, is the process of assessing your employees' success at their jobs. Organizations often use these evaluations to determine whether a person is fit for a promotion or raise.
What are the 3 types of performance evaluation?There are several types of performance appraisals, including peer reviews, self-assessments and 360-degree assessments. Though they might not provide a full view of an employee's performance, appraisals can help guide responsibility and goal setting for managers.
What is it called when a manager reviews your performance?A performance review is a formal assessment in which a manager evaluates an employee's work performance, identifies strengths and weaknesses, offers feedback, and sets goals for future performance. Performance reviews are also called performance appraisals or performance evaluations.
What are the different methods of performance appraisal?Six modern performance appraisal methods. Management by Objectives (MBO) ... . 360-Degree Feedback. ... . Assessment Centre Method. ... . Behaviorally Anchored Rating Scale (BARS) ... . Psychological Appraisals. ... . Human-Resource (Cost) Accounting Method.. |