Page 103 - DMGT106_MANAGING_HUMAN_ELEMENTS_AT_WORK

Unit 5: Appraising and Evaluating People in the Organization

According to C.D. Fisher, L.F. Schoenfeldt and J.B. Shaw, “Performance appraisal is the Notes
process by which an employee’s contribution to the organization during a specified period
of time is assessed”.
From the above definitions we can conclude that performance appraisal is a method of
evaluating the behaviour of employees in the work spot, normally including both the
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 he is performing the job and
ideally establishing a plan of improvement. Performance appraisal emphasises individual
development. Now it is used for evaluating the performance of all the human resources
working at all levels of the organization and of all types. It evaluates the performance of
technical, professional, and managerial staff.

5.1.1 Objectives of Performance Appraisal
Performance appraisal plans are designed to meet the needs of the organization and the
individual. It is increasingly viewed as central to good human resource management.
Performance appraisal could be taken either for evaluating the performance of employees
or for developing them. The evaluative purpose have a historical dimension and is concerned
primarily with looking back at how employees have actually performed over given time
period, compared with required standards of performance. The developmental purpose is
concerned with the identification of employee’s training and development needs.
Appraisal of employees’ serves several useful purposes:

Feedback
It tells him what he can do to improve his present performance and go up the “organizational
ladder”. The appraisal thus facilitates self-development.
Compensation Decisions

It provides inputs to system of rewards. The approach to compensation is at the heart of the
idea that raises should be given for merit rather than for seniority.

Performance Development
Performance appraisal can help reveal the causes of good and poor employee performance.

Training and Development Programme
By identifying the strengths and weaknesses of an employee it serves as a guide for
formulating a suitable training and development programme to improve his quality of
performance in his present work. It can also inform employees about their progress and tell
them what skills they need to develop to become eligible for pay rises and/or promotions.
Promotion Decisions
It can serve as a useful basis for job change or promotion.

Personal Development
Performance appraisal can help reveal the causes of good and poor employee performances.

Improves Supervision
The existence of a regular appraisal system tends to make the supervisors more observant
of their subordinates. This improves supervision.

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