Performance appraisal benefits

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I. Contents of getting performance appraisal benefits

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The performance appraisal is an essential part of the human resources department's contribution
to an organization. An effective appraisal may not only eliminate behavior and work-quality
problems, it can motivate an employee to contribute more. Often, a company will ask its
employees to perform "360-degree feedback" that assesses peers and subordinates as well as
supervisors and management. Regardless, the opportunity to receive -- and give -- constructive
criticism shouldn't be ignored.
Improving Communication
All too often, employees and managers don't get along and can't understand why. Problems that
stem from a lack of communication can sometimes be resolved with a performance appraisal. If
the appraisal is used as an opportunity to describe the criteria on which performance is judged -using meaningful and relevant examples -- then the employee will walk away from the meeting
with a better understanding of how to best perform his job. For example, "John, when I say you
need to be more customer-focused, what I really want is to see you greet the customers with a
smile when they enter the store, and ask how you can help."
Providing a Career Path
The performance appraisal is the perfect opportunity to address long-term goals that may not be
on the everyday to-do list. Not only does this provide the employee with an opportunity to be of
greater use to an organization, the employee feels pleased and valued. Lighting the way toward a
successful career path inspires loyalty and stability and can improve the bottom line, especially
when the employee's first concern is the health of the business, and subsequently, her career.

Encouraging Good Work and Improvement

Celebrating a job well-done is the easy part of the performance appraisal. Noting areas of
improvement is not so easy. Nevertheless, no one is perfect, and the performance appraisal is an
ideal time to diplomatically highlight areas that need improvement. Even the most valuable
employee could benefit from additional training, while those who are on the cusp of dismissal
need the heads-up. Be specific by providing examples and clearly explain what needs to occur to
turn things around. Showing an employee that you care enough about them by taking the time to
work with them may make even the most hardened employee feel better.
Improving Decision-Making Ability
When a company has detailed information on employee performance, business decisions become
easier. Filling open positions with existing staff strengthens the organization and promotes
loyalty. Knowing which employees display what strengths improves the speed with which
projects can be assigned. Appraisals also provide a framework when making decisions about
compensation -- and layoffs. If the organization becomes the unfortunate party to a lawsuit, the
performance appraisal can refute or support claims. As a result, the effective use of performance
appraisals helps an organization operate efficiently and with focus.
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III. Performance appraisal methods

1. Essay Method
In this method the rater writes down the employee
description in detail within a number of broad categories
like, overall impression of performance, promoteability
of employee, existing capabilities and qualifications of
performing jobs, strengths and weaknesses and training
needs of the employee. Advantage It is extremely
useful in filing information gaps about the employees
that often occur in a better-structured checklist.
Disadvantages It its highly dependent upon the writing
skills of rater and most of them are not good writers.
They may get confused success depends on the memory
power of raters.

2. Behaviorally Anchored Rating Scales

statements of effective and ineffective behaviors

determine the points. They are said to be
behaviorally anchored. The rater is supposed to
say, which behavior describes the employee
performance. Advantages helps overcome rating
errors. Disadvantages Suffers from distortions
inherent in most rating techniques.

3. Rating Scale
Rating scales consists of several numerical scales
representing job related performance criterions such as
dependability, initiative, output, attendance, attitude etc.
Each scales ranges from excellent to poor. The total
numerical scores are computed and final conclusions are
derived. Advantages Adaptability, easy to use, low cost,
every type of job can be evaluated, large number of
employees covered, no formal training required.
Disadvantages Raters biases

4. Checklist method
Under this method, checklist of statements of traits of
employee in the form of Yes or No based questions is
prepared. Here the rater only does the reporting or
checking and HR department does the actual evaluation.
Advantages economy, ease of administration, limited
training required, standardization. Disadvantages Raters
biases, use of improper weighs by HR, does not allow
rater to give relative ratings

5.Ranking Method
The ranking system requires the rater to rank his
subordinates on overall performance. This consists in
simply putting a man in a rank order. Under this method,
the ranking of an employee in a work group is done
against that of another employee. The relative position of
each employee is tested in terms of his numerical rank. It
may also be done by ranking a person on his job
performance against another member of the competitive
group.
Advantages of Ranking Method
Employees are ranked according to their
performance levels.
It is easier to rank the best and the worst
employee.
Limitations of Ranking Method
The whole man is compared with another
whole man in this method. In practice, it is very difficult
to compare individuals possessing various individual
traits.
This method speaks only of the position where an
employee stands in his group. It does not test anything
about how much better or how much worse an employee
is when compared to another employee.
When a large number of employees are working,
ranking of individuals become a difficult issue.
There is no systematic procedure for ranking
individuals in the organization. The ranking system does
not eliminate the possibility of snap judgements.

6. Critical Incidents Method

The approach is focused on certain critical behaviors of

employee that makes all the difference in the
performance. Supervisors as and when they occur record
such incidents. Advantages Evaluations are based on
actual job behaviors, ratings are supported by
descriptions, feedback is easy, reduces recency biases,
chances of subordinate improvement are high.
Disadvantages Negative incidents can be prioritized,
forgetting incidents, overly close supervision; feedback
may be too much and may appear to be punishment.

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