A project report on Performance Appraisal of Employees.

This report will help you to learn about:- Meaning of Perf

ormance Appraisal 2. Objectives of Performance Appraisal
3. Process 4. Methods 5. Need 6. Factors Distorting Perfo
rmance Appraisal 7. Benefits 8. Limitations.
Contents:
1. Project Report on the Meaning of Performance Appraisal
2. Project Report on the Objectives of Performance Apprais
al
3. Project Report on the Process of Performance Appraisal
4. Project Report on the Methods of Performance Appraisal
5. Project Report on the Need for Performance Appraisal
6. Project Report on the Factors Distorting Performance Ap
praisal
7. Project Report on the Benefits of Performance Appraisal
8. Project Report on the Limitations of Performance Apprai
sal

Project Report # 1. Meaning of Performance Appraisal:

Performance means doing a job effectively and efficiently,
with a minimum degree of employee-created disruptions.
A good worker is one who performs well in terms of prod
uctivity and also minimises problems for organisation by
being to work on time, by not remaining absent, and by
minimising work related problems.
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Performance appraisal is sometimes termed as employee a
ppraisal, merit rating, personnel rating and personnel perf
ormance evaluation. The appraisal of other’s performance
is a fundamental human act.
Performance appraisal is the systematic evaluation of the i
ndividual with respect to his performance on the job and
his potential for development. Performance appraisal empl
oys rating techniques for comparing individual employees
in the work group, in terms of personal qualities or defici
encies and the requirements of their respective jobs.
Scott, Clothier and Spriegel have defined performance app
raisal as “process of evaluating the employees performance
on the job in terms of requirements of the job.”
According to Yodder, performance appraisal refers to all f
ormal procedures used in working organisations to evaluat
e personalities and contributions and potential group of m
embers.
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Performance appraisal can be defined as, “the process of asses
sing the performance and progress of an employee or a group of employe
es on a given job and his potential for future development”.
Flippo defined the performance appraisal as, “the systematic,
periodic and an impartial rating of an employee’s excellence in matters pe
rtaining to his present job and his potential for a better job.”
Performance appraisal can also be defined as, the process
of obtaining, analysing and re-cording information about t
he relative worth of an employee.
It is the systematic examination of an employee’s strength
s and weaknesses in terms of the job.
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It is an on-going or continuous process wherein the evalu
ations are arranged periodically according to a definite pla
n.
Project Report # 2. Objectives of Performance Apprais
al:
1. To provide feedback to individual employees so that the
y can know where they stand and can improve their perfo
rmance.
2. To provide database for the decisions by the manageme
nt regarding placement, pro-motion, transfer, punishment
etc.
3. To diagnose the strengths and weaknesses of individual
s so as to identify training needs.
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4. To provide counseling, career planning to subordinates.
5. To facilitate research in personnel management.
6. To test the effectiveness of recruitment, selection, place
ment and induction programmes.
Project Report # 3. Process of Performance Appraisal:
The process consists of following steps:
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1. Establish performance standards.
2. Communicate performance expectations to employees.
3. Measure actual performance.
4. Compare actual performance with standard.
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5. Discuss the appraisal with the employee.
6. If necessary, initiate corrective action.
Project Report # 4. Methods of Performance Appraisal
:
Since there is a universally acceptable method for perform
ance appraisal, various organisations employ different tech
niques for different category of their employees.
Some of the common methods used for appraisal are given hereunder:
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1. Essays and overall ratings:
In this system, rater is asked to give an overall evaluation
in narration form for the past year and to provide overal
l rating.
2. Trait-rating Scales:
In this system, a rater is required to indicate on numerica
l scale the degree to which an employee is appraised on t
he traits he possesses.
3. Ranking Method:
In this system, rater is required to distribute the employe
es along a scale on the basis of performance or simply lis
t them in order of effectiveness. This helps in selecting to
p 1% or 5% or 10% and bottom 10% or so on.
4. Critical Incident Method:
In this method, rater is required to document the positive
and negative behavioural events that have occurred in a
particular period.
Project Report # 5. Need for Performance Appraisal:
1. It can be used as a basis for reward allocations i.e., sal
ary increases, promotions and other rewards.
2. It can be used for identifying areas where development
efforts like training and devel-opment are needed. Perfor
mance appraisal helps in identifying those deficiencies wh
ere development is needed.
3. Selection process can be developed on the basis of a va
lid reliable and bias free per-formance appraisal system.
Psychologically, performance appraisal is a powerful tool
with tremendous impact on, the mind of employees and, t
hrough them on the organisation.
The purposes of performance appraisal are:
(a) To facilitate to find out suitability for;
i. Promotion
ii. Transfer
iii. Demotion or termination etc.
(b) To select persons for training and development;
(c) To facilitate in determining salary, increments etc.
Project Report # 6. Factors Distorting Performance Ap
praisals:
In the performance appraisal system, it is assumed that e
valuator is free from personal biases and prejudices and t
hat all managers impartially interpret and standardise the
criteria for the appraisal. Efforts should be made to utilise
direct performance criteria for appraising individuals whe
rever possible.
Following are the main factors which can affect the objective evaluation, a
nd thereby validity and dependability of the performance appraisal system:
1. Leniency Error:
Sometimes rater has his own value system which acts as
a standard against which appraisals are made. When the s
ubordinate is rated higher than actual, it is referred to as
positive leniency error, and when rated low, it is referred
to as negative leniency error.
2. Halo Error:
Halo error or effect is a tendency to evaluate on all factor
s due to the general impression.
3. Bias:
Sometimes evaluators are biased for several reasons such
as regional, religious backgrounds, social or interpersonal
conflicts.
4. Similarity Error:
Those subordinates who demonstrate the characteristic si
milar to that of evaluator tend to benefit, while others are
penalised.
5. Central Tendency:
Some evaluators avoid using the extremes of rating scales
and to award ratings around the midpoint.
6. Strictness Error:
This error occurs when the rater artificially assigns all or
a certain group low performance ratings.
Project Report # 7. Benefits of Performance Appraisal:
In the words of Dalton E. McFariand, “The purpose of an
y formal method of systematic employees appraisal is to p
rovide greater objectivity in the executive’s judgement abo
ut subordinates. It is also an objective to regularise the pr
ocedures used by requiring periodic appraisals, so that up
-to-date information is available for use in making decisio
n about people.”
Performance appraisal has become a very significant activi
ty in most of the enterprises, because it provides data abo
ut past, present and expected performance of the employe
es which is helpful in taking decisions on selection, traini
ng and development, increases in pay, promotion, transfer
s and the like.
The following are the benefits of performance appraisal:
1. It helps the supervisors to evaluate the performance an
d to know the potentials of their subordinates systematical
ly.
2. Ratings can be used as a basis of sound personnel poli
cy in relation to transfer and promotion.
3. It helps in designing the training programme in a bette
r way.
4. Performance ratings help in guiding the employees.
5. The employees also come to know where they stand an
d consequently they try to improve their performance.
6. It will reduce grievances and develop a sense of confid
ence amongst the workers because they are convinced of t
he impartial basis of evaluation.
7. The records of performance appraisal are available in a
permanent form to protect the management against subse
quent charges of discrimination which might be levelled b
y the trade unions.
Project Report # 8. Limitations of Performance Apprai
sal:
The drawbacks or limitations of various methods of performance appraisal
are as follows:
1. If the factors included in the assessment are irrelevant,
the result of merit rating will not be accurate.
2. Different qualities to be rated may not be given proper
weightage in certain cases.
3. Some of the factors are highly subjective like initiative
and personality of the employees.
4. Supervisors often do not have critical ability in assessin
g the staff. Sometimes, they are guided by their personal
emotions and likes.
Related Articles:
Performance Appraisal: Need and Features of Performance Appraisal

Top 8 Methods of Performance Appraisal

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