PROCESS OF PERFORMANCE APPRAISAL

The logical sequence of steps in a performance appraisal process are the following:

1. Set the objectives of performance appraisal Generally, a performance appraisal serves three purposes:

(a) Administrative—for the use of personnel decisions like promotions, transfers, pay increase, etc.

(b) Research—for validating selection instruments.

(c) Developmental—to identify the training needs of employees.

So, objectives of performance appraisal are set depending upon the needs of the organisation.

2. Establish standards of performance

The next step is of setting the standards of employee performance. These standards act as a base, yardstick or benchmark for evaluating the performance. The set standards will inform the employee that what is expected from him or her on the job.

3. Communicating the performance standards to employees

The next logical step is to communicate the set standards to the employees. Inform the employees what is desired from them on the job. It is important that they understand what is expected from them or is there any confusion or misunderstanding. If needed, clarify the standards.

4. Measure actual performance

The next step is now to actually measure the performance of employees. The performance can be measured by personal observation, written reports, ratings by supervisors, etc.

5. Compare actual performance with the standard performance

Next step is to compare the actual performance with the standard set earlier. Deviations, if any, from the set standards are noted. Identify the reasons for deviations and analyse it.

6. Discuss the reports with employees

Now discuss the assessment reports with employees. Provide them feedback how they are performing.

7. Take corrective action, if any

Finally, the last step is to take corrective action if need arises. This may include advising, counselling, warning, motivating, coaching, and training, etc. employees. These are useful ways to correct the defect and improve employee's performance.