Introduction to Management

Chapter Summary

Performance appraisal is the process of evaluation of individual job performance in order to make objective human resource decisions. It involves the formal evaluation of an employee's job performance, feedback to the individual and determination of whether and how the performance can be improved. The process of performance appraisal occurs both formally and informally.

An informal appraisal is where the manager mentions that a particular job was performed well or poorly during the performance of the job or immediately after the job is performed. It is conducted on a day-to-day basis. Formal appraisal occurs annually or semiannually on a systematic basis. It has four major purposes: (1) to let employees know how their present performance is being formally rated, (2) to identify those employees who deserve merit raises, (3) to identify those employees who require additional training, and (4) to identify candidates for promotion. There are four basic approaches to formal appraisal: (1) a superior's rating of subordinates, (2) a group of superiors rating subordinates, (3) a group of peers rating a colleague, and (4) subordinates' rating of bosses.

A performance appraisal system has the characteristics of all feedback control methods. Through this system, managers can obtain information related to employees, their job performance and the job outcomes. The effectiveness of a performance appraisal depends on the quality of the control techniques used such as establishing standards, information, and corrective action.

As performance is multidimensional, performance appraisal methods must consider the various aspects of a job. Performance rating can either be behavior-oriented or result-oriented. Within the behavior-oriented category, two important assessment means are graphic rating scales and behaviorally anchored rating scales.

The appraisal should measure both, the manager's performance in accomplishing goals and plans as well as his performance as a manager. The system of measuring performance against verifiable goals should be supplemented by the appraisal of a manager as a manager. Performance appraisal requires the identification of the strengths and the weaknesses of an individual. This identification process proves to be the starting point of a career plan.

The formulation of a career strategy involves several steps. These include preparation of a personal profile, development of long-range personal and professional goals, analysis of the environmental threats and opportunities, identification of personal strengths and weaknesses, development of strategic career alternatives, consistency testing and strategic choice, development of short-range career objectives and action plans, development of contingency plans, implementation of career plans and monitoring of progress.

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