Performance Appraisal Tutorial | Introduction

Performance Appraisal is a systematic assessment of the performance of employees. It encompasses feedback of performance and exploring potential of an employee for further growth and development. Starting with the business’s strategic plan, it enlists the organizational goals to be reached through a set of strategies. These strategies are percolated down to individual business units, who in turn determine how individual job tasks and requirements are defined. These determined goals and strategies also play a role in setting the skills and core competencies each employee must possess to successfully complete the job and contribute to meet the strategic goals. These factors, in theory, form objective measures on which the employee’s actual performance is evaluated. Performance consists of evaluation of behavior as well as results. In the end, individual components of the appraisal are evaluated as per the organizational requirements. For example, integrity might be more important than “quantifiable” qualities like target achievement.

Key objectives of a performance appraisal could be as follows,

A framework of feedback to the employees for a better performance.
A platform for discussing training and developmental plans.
To maintain and assess the potential of an employee for further growth opportunities.
Compensation plan of employee’s vis-à-vis organizational targets and plans.
To identify the strengths and weaknesses to place right employees in the right role.
To serve as a basis for discussing and solving issues of the employees.
To review and retain promotions and cross functional responsibilities.

Performance appraisal in short is an evaluation framework which is critical for an organization’s growth.