Performance Appraisal

Although performance appraisals have a lot of benefits, they require a lot of effort for successful implementation. Normally, pay for performance (PRP) along with individual and organizational professional development are among the crucial motivational activities behind it that make it productive.Performance Appraisal Process
However, it’s very first impact on the employees is not very encouraging (most of the times) since they tend to assume that now their performance will be measured/evaluated, resulting in a ‘defensive’ attitude towards evaluation.
Therefore, to make it fruitful, performance expectations (targets) should preferably be discussed with the employees beforehand. Furthermore, alignment of individual performance with organizational goals holds the key to make this system yield positive results.
My question is how can the negative effects of this system be reduced or addressed. This is usually correlated to performance appraisals because if they aren’t being addressed then there is a possibility that the whole purpose behind implementing such a system might be defeated. Would appreciate your views in this regard.


  • Jeff Swanson

    Performance evaluations are created most specifically to compare individual results with expectations/standards. The evaluation process can be intimidating and present negative feelings if the results of the evaluation come as a surprise to the employee.
    Consistent feedback to (and from) the employee and corrective action must be ongoing. The evaluation itself should be used to indicate the progress made during the year.
    Action plans should be developed on an as needed basis during the year to steer the employee towards the desired results. This is where the consequences/benefits for improvements should be stated so that the evaluation comes as no surprise to anyone.

  • David Gabor

    What a wonderful question!
    I have a been in the employment field for more than 20 years and have viewed the issue from the perspective of attorneys involved in litigating employment disputes and as a mediator and arbitrator in resolving the disputes. Most recently, I have done training inside companies in how to find ways to better engage employees so that productivity, morale and customer satisfaction can improve.
    I do support the use of the performance appraisal. However, the purpose is to both coach and measure performance. A properly designed appraisal coupled with the right coaching can get the job done. However, that assumes that those who issue the appraisals are in the right position. All too often, promotions to supervisory positions are predicated on performance and not whether the person is suitable to be a supervisor.
    At the end of the day, it comes down to fostering a positive relationship between HR, C-Levels, supervisor and employees. With proper communication, respect and understanding can come an effective system and a wonderful workforce.
    David Gabor
    (516) 248-2525

  • Peter G. is on to something with his answer. But to elaborate, the key is approaching the issue from many sides. I’ve broken my answer up into five “C’s.”
    First, Clarity. The organization must be CLEAR as to what their measurements are. Will the organization be including Key Performance Indicators into the performance appraisal? If so, those KPIs should be communicated early and clearly. They should be distributed fairly across the organization using objective intra (and possible inter) group measures such as pay grades, job classifications, etc. so that it never seems as if one person (or group) is singled out. In addition, the performance appraisal itself should be clear, clearly related to the employees’ job, clear on the process of how it is completed. Doing a job analysis on a job (or set of jobs) will help to define the competencies that show a clear relationship between an appraisal and an employee’s job.
    Wide-ranging User Acceptance testing is important in the course of implementing a performance appraisal (whether online or not) to determine its clarity before rolling out. One should look at wording, definitions and (in the case of an online appraisal), the number of clicks a user has to do to complete their tasks.
    Second, Communication: The organization must communicate all expectations regarding the KPIs (if included) and competencies. For example, are the aforementioned KPIs weighted in some way? Again, clear communication is the key so as to set expectations. Same thing with competencies. What competencies are being measured? How are they being used? What are the demarcation points for high performers vs. low performers? Is this being communicated throughout the organization? The organization must then communicate the appraisal process repeatedly. When does it start? When does it end? What do employees do? What trainings are available to make the process less painful?
    Finally, (and this is probably the most important), the organization must communicate, not just the results, but what it will do with an employee’s results. How will a certain score affect each employee? What sorts of rewards are available for top performers? Will training be made available for others? Is the appraisal used strictly for developmental purposes? I’d recommend making the latter sentence clear if you’re worried about participation. As both Peter and David pointed out communicating the “coaching” aspects (vs. the punitive aspects) of the appraisal often makes employees more willing to participate.
    However, whether you’re using your appraisal to coach and develop or reward and punish, the loop must be closed at some point if you want to continue the appraisal process in the future.
    Culture: In developing your appraisal system, you should be aware of your organization’s culture. Is your org primarily off-line? Then an online system might not be wise. Is your org primarily team-based? Then individual-level metrics (and rewards) might be challenging to collect (and award.) Finally, understanding your organization’s culture may help you define your competencies. Though your competencies should be entirely job-based, if you were to measure organizational values for example, you may want to know that the things you are attempting to measure even exist in your organization. Are you trying to measure commitment to diversity? Kudos if you are, but the first time an employee should be hearing this message should NOT be on the performance appraisal. It sounds common sensical, but it’s sometimes overlooked.
    Compensation: Sometimes, it’s not always about the carrot, but also the stick. If you want to drive appraisal compliance, you may need to get executive buy-in that managers’ compensation may also be tied into the compliance of their subordinates. Your system should have a way to regularly update and report on compliance to continue to “help” those managers whose subordinates aren’t participating. (They’ll appreciate the heads-up, as you can imagine.)
    Consistency: Finally, if the organization is consistent about what it does, how it communicates, how it rewards (or punishes), employees should participate. And, heck, if an organization consistently rolls out its performance appraisal, over time you should get participation if only because “that’s the way it’s always been done.”
    Good luck to you.

  • Starting the eval process from scratch demands a first year with only a review not an evaluation. Discussing the goals for next year with each employee and the objective standards that will be used. Discussing the employees past performance against the proposed standard without rating or ranking them will guide them in meeting those goals for next years.
    If you are changing systems you must wait for the annual review period, use the old system for last year and explain the new goals and process for next year.
    If your going to use the evaluation as part of a pay for performance system, you must do a progress review every month so employees can adjust what they are doing to maximize their pay. Yes it’s a costly system, but that’s what it takes to have a fair and honest system.

  • In my experience feedback is critical to the success of the organization and to the individuals. There are some key factors that will contribute to a performance appraisal process being most effective and positive for all participants.
    The implementation of the appraisal process must include significant communication for both the individuals completing the appraisals and those receiving the appraisals. Everyone should know what the process looks like, their role in the process and what the intended goal of the process is. The process of providing feedback to the individual should always be to improve their performance versus creating another piece in the “paper trail”.
    The performance appraisals should be clearly focused on what would make the individual successful in the performance of their role. The company should spend time in the development of the appraisals to determine what these success factors are. Those success factors should be communicated to all well in advance of the appraisal itself.
    Training for the individuals completing the performance appraisal is a key factor in the success of the process. It provides some consistency in the evaluation of those success factors and helps to avoid the common pitfalls of evaluation such as focusing on something that just happened versus the entire time frame for the evaluation.
    I have also had individuals complete a self evaluation and bring it with them to the discussion. It help them focus on a full picture of their own performance.
    The performance appraisal itself should be about the discussion versus the “piece of paper”. I recommend not bringing out the form until the end of the conversation. Talk about what the person has done well, where they need improvement and ask them for their perspective on their performance and your feedback.
    Lastly feedback should be on-going, not once a year, twice a year or every quarter. A formal process of evaluation and action planning can provide a good template for an on-going discussion focused on improving someone’s performance and in turn the organization’s.

  • Often times the appraisal process is viewed by the appraisee as a negative or critical-only situation. This happens because the appraiser is ineffective or incompetent in the delivery process for various reasons including poor mentoring, poor judgement, personal beliefs, lack of adequate skill base in delivering appraisals, and potential personal dislike of the employee.
    The intent of the appraisal should be three-fold – 1) Praise the employee – let them know in what areas they are meeting or exceeding expectations of the job; 2) communicate areas of opportunity for the employee, i.e. areas they need to improve or where they aren’t meeting expectations as compared to goals set and/or their job description; and 3) with the employee’s input, set goals to for the employee to accomplish between now and the next appraisal.
    Absolutely nothing should be a surprise to the employee during the appraisal. The appraisal is NOT the time to bring up some new areas of opportunity for the employee. The employee should be made well aware of their opportunities throughout the course of the, i.e. year.
    The appraisal should be about 70% celebration of accomplishments and strengths, 5% recapping areas of opportunities or areas for improvement, and 25% goal setting for the upcoming review.
    If a company doesn’t institute the practice of having the employee complete a self-appraisal prior to the formal appraisal, I highly advise this as it can lead to clearer lines of open communication and ideally, affirmation that the appraiser and appraisee are on the same page. I understand this is not practical in all corporate settings and job positions

  • Performance Appraisal, as the complexities of word itself define the all. Performance Appraisal is not merely means to appraise the performance of the Individual or group or team, as misunderstood by many of the personnel in the organisation.
    But the basic motto of performance appraisal is the assessment of employee in every aspect or by every degree, that the terms 180, 270, 360 Degree Performance Appraisal came.
    What I think the theory that we learn throughout our discipline is not implied more than 20-30% in the real life. As performance Appraisal is seen as the tool for salary hike or training need Analysis only, but Personal development.
    Also, negative effect of system affect each and every organisation in one or other terms like attrition, jealously among employees, reduction in morale, poor team work. As man is Social Animal and nobody want other to improve more than him/her especially the juniors.
    The negative effect of the Performance Appraisal System is to be taken care at the very initial stage of its implementation.
    1. Define Key Result Areas (KRAs) for each department as well as individual.
    2. Define Key Performance Areas (KPAs) for each department and individual.
    3. Self Assessment would be necessarily done to know where each employee find himself to stand.
    KRA & KPAs would be define so that each one know on what basis they will be assessed at the end of their assessment period.
    And finally last but not the least the communication part because there is no result just to define all these jargons, but a clear & sound communication is equally responsible for the success of anything…..

  • In a word, no! I strongly agree with BB Robinson that PA Systems (and MBOs) should be scrapped. Interestingly, as result of a debate I had with a couple of colleagues, in another thread, I asked about the outcomes/impact of performance appraisals.
    I then contacted a number of clients and asked them the same thing. Here are the dominant themes that emerged from both groups around what a PA system does:
    o Destroys morale and self-esteem
    o Produces lackluster motivation
    o Creates high stress levels throughout an organization
    o Provides great CYAs for managers and supervisors
    o Discourages team work and collaboration
    o Creates bitterness and acrimony
    o Discourages truth and openness
    o Wastes a great deal of time and effort
    o Squashes innovation and creative thinking
    o Adds no measurable value, except:
    o Keeps salaried wage increases low
    The emotional aftermath of PAs within an organization is astonishing. There may be happy people in the top rating category, but this is generally about 20% of the workforce and in many companies with four or more possible ratings, it is sometimes as few as 5%. Since the majority of people believe they are above average performers, this means that 80% to 95% of people are likely to be dissatisfied, upset, depressed and possibly angry or bitter. Such feelings can persist for months, negatively impacting motivation and performance.
    There is a stubbornly clung to assumption that PA ratings and feedback will improve performance at both the individual and organisational level. But there are no robust studies or surveys that support this assumption. A much quoted study by Timothy Schellhardt (WSJ Nov. 1996) concluded that over 90% of PA systems were unsuccessful. Decades of effort by managers, Human Resources professionals and outside experts have failed to find the magic form.
    W Edwards Deming wrote (and frequently said) that 96% of organization problems are systemic; only 4% are attributable to human error and/or dereliction. There are a host of systems, processes, policies, structures, politics and idiosyncratic factors that affect the ability of any employee to succeed. He further said that to improve the system the focus should be on the system, not individual performance.
    An oft-quoted positive for PAs is that they are an opportunity to provide employees with feedback. In terms of individual supervisor-subordinate feedback, the most frequent dynamic we see has the supervisor in control of when and where the feedback is given. It is usually one way, rather than a dialogue in which the employee can explore the feedback received and give feedback to the supervisor on how well the supervisor is supporting the employee’s efforts to successfully carry out their job to the best of their ability. The latter two-way dynamic can build mutual confidence and trust; the former – especially when given as part of an assessment process — generally feels like a parent-child judgment, can damage trust, and generate enduring negative feelings.
    In terms of raising the game for the overall organization, the most impactful use of feedback is from the external customer and –at the systems level – feedback from internal customers within a system to those responsible for the previous stage or sub-process in the system.
    Another issue with PA assessments and ratings is that sound psychological research about conscious and unconscious biases abounds, but these studies are seldom considered in PA systems.
    We have come to believe that PA systems overall have a devastating impact on organization performance: Damaging motivation, encouraging individual competitive behaviours and destroying teamwork and collaboration, encouraging lying and ‘fudging’ of results, diverting attention away from the vision and the customer, squashing innovation and nimbleness, as well as the willingness and ability of most employees to ‘see’ and leverage new opportunities for the business.
    I should mention that in my informal survey, the people I spoke with were not disgruntled employees with an axe to grind, but successful managers and human resources professionals.

  • All we need is patience of varies from employee to employee.All we should highly focus on is what good can make performance appraisal more beneficial..let our difficulties be our inspirations.Don’t let the bad take over what u really want but always focus on what good will come with it.

  • I think if you combine performance appraisals not just with the overall goals but also with development of employees than they are a real motivational tool. The performance appraisal takes place in the middle or at the very end of a performance period. If the period before the actual appraisal was managed (coached) correctly than I believe the appraisal itself is no surprise in any way and hopefully a moment that confirms that manager and employee did an excellent job during this period.

  • A more positive impact can be cultivated by focusing on the employee’s strengths, amplifying what’s going well to encourage more of the same, and recommendations for what can be done better going forward … so it’s more of a collaborative and productive process

  • Check my earlier answers to this question. I am among those who feel that standard performance appraisals should be abolished.

  • So often performance appraisals are viewed in a negative light but they really are and can be great ways to build bridges rather than moats between employees and their supervisors.
    If an employee is doing a good job isn’t it nice that occasionally (even if only once a year) someone tells them so?
    And isn’t it better to know what a boss is looking for rather than guessing (and even worse – guessing wrong?). Appraisals can offer insight into what a manager really wants from an employee (versus an employee thinking they’re are doing a good job for them and finding out they don’t think so!). And it’s a chance for the employees to talk about what role they play (or think they are playing) for their supervisor. It’s also a chance to redirect efforts of both parties to common goals.
    As pointed out by others, no employee should be blindsided in an appraisal. They should be aware coming in of any performance or attendance issues. Those issues should be briefly reviewed with them by the manager but then the focus should be turned to the future (which they can change) versus the past (which they can’t). If it’s approached in this manner, it will be better received than just a review of last year’s ups and downs.

  • Making employees happy, it could bring out good performances in most of service industries especially when it comes to fast food chain.

    People differ in their abilities and their aptitudes. There is always some difference between the quality and quantity of the same work on the same job being done by two different people. Performance appraisals of Employees are necessary to understand each employee’s abilities, competencies and relative merit and worth for the organization. Performance appraisal rates the employees in terms of their performance.
    Performance appraisals are widely used in the society. The history of performance appraisal can be dated back to the 20th century and then to the second world war when the merit rating was used for the first time. An employer evaluating their employees is a very old concept. Performance appraisals are an indispensable part of performance measurement.
    Performance appraisal is necessary to measure the performance of the employees and the organization to check the progress towards the desired goals and aims.
    The latest mantra being followed by organizations across the world being – “get paid according to what you contribute” – the focus of the organizations is turning to performance management and specifically to individual performance. Performance appraisal helps to rate the performance of the employees and evaluate their contribution towards the organizational goals. If the process of performance appraisals is formal and properly structured, it helps the employees to clearly understand their roles and responsibilities and give direction to the individual’s performance. It helps to align the individual performances with the organizational goals and also review their performance.
    Performance appraisal takes into account the past performance of the employees and focuses on the improvement of the future performance of the employees. Here at naukrihub, we attempt to provide an insight into the concept of performance appraisal, the methods and approaches of performance appraisal, sample performance appraisal forms and the appraisal softwares available etc. An attempt has been made to study the current global trends in performance appraisal.

  • First of all, the objective and each point in the performance appraisal should be explained to appraisee. It’s the responsibility of HR that the employees take the appraisal in positive manner rather than being defensive. HR should make them understand that the appraisal will help them to improve and come back stronger next year. Also, let them know that appraisal measures your overall performance that includes discipline, communication skills, interpersonal skills, managerial skills aling with technical. I believe this way the issue can be addressed.

  • Good question!
    “Performance Appraisal” — trying to recall, some where i hear or might be saw on some paper some where!
    At this moment unable to find in dictionary!
    Best Regards
    Learner & Helper
    Ravi Sharma

  • Ramakanth R

    My two cents in.. I understand when the employee is in the defensive mode. I being the management for about 10 years have learned it the hard way on how to deliver the performance review of an individual.
    What we managers tend to do is provide the employee with the feedback only at the time of the performance appraisal, which makes the employee feel that we are trying to avoid a hike for them. However, in my experience if the feedback (both positive and negative) is delivered to the employee on a regular basis or as on need basis throught out the year then they are already aware of their performance and do not have any surprises.
    This has actually worked for me and for my fellow managers. We had good system in place for performance appraisals. We need to look at the performance of the employee on the basis of Ability, Tools, Opportunity provided to them. Some times the employee has the ability to learn but the tools and opportunity was not available to show their skills. Other times they have the ability and tools but no opportunity. We need to look at are we providing the opportunities for the employees to prove them selves.

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