The basic components of an effective appraisal system
Performance appraisal means evaluating an employee’ performance based on clear performance standards set for that specific job. For an appraisal system to be effective the following aspects need to be fulfilled. There are 3 major components to designing good performance appraisal systems- 1) setting clear work standards, 2) evaluation of employee performance relative to those standards and 3) provide feedback to the employee to him/her to motivate and improve performance.
- Clear standards should be set and communicated to the employees. While defining the performance standards the employee should also agree to the duties, job standards and the appraisal method.
- The goals assigned should be SMART- specific, measurable, relevant and time bound.
- The performance appraisal should be unbiased and realistic at all times.
- The appraisal should include a feedback session where the manager and the subordinate discuss the performance, challenges and issues faced. They should then jointly set clear, mutually-agreed plans to improve performance.
- Manager should be trained in the necessary skills required to effectively use performance appraisals to drive performance
- Good performance should lead to rewards and benefits for the employee so as to enhance their motivation and commitment.
How performance appraisals can contribute to organizational goals and objectives.
The organization goals and the performance goals for each employee should be aligned. The actions and tasks undertaken by the employee should contribute to the achievement of the organizational goals of the organization. A well-designed performance appraisal system allows the organization to achieve its goals faster, track deviations and deficiencies in the work quality and decide interventions when necessary, to get performance levels back on track. If you consider the organization as a large boat, then the performance appraisal system act as the rudder. This will steer the organization in the right path that will take it to its goal. In cases where deviations from the path is identified, it can be used to steer the organization back to the right path.
The advantages of performance appraisals and how they contribute to effective training and development.
Once performance appraisals are conducted the employee performance is assessed to identify gaps. Clear assessments will reveal gaps in performance and the causes can be analyzed. If the cause is identified as due to a deficiency related to the knowledge or skills levels of the employee then training and development can be used to improve these areas. The competency levels and work quality levels are clearly defined in the performance appraisal criteria for each job. This also provides clear measurement criteria for training and development to decide the amount of training required to develop the competency levels required for each job. Performance appraisals also reveal the inherent potential of the employee, which once identified, can help the organization in succession planning.
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