This document discusses how to conduct effective employee performance appraisals. It recommends setting individual goals collaboratively, making the process ongoing with regular feedback, using multiple inputs for evaluation, and automating the process for efficiency. Six common appraisal methods are described: ranking, rating scales, checklists, critical incidents, essays, and behaviorally anchored rating scales. The goal of performance appraisals should be ongoing communication, setting achievable goals, and planning for improvement.

1. How to performance appraisal
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I. Contents of getting how to performance appraisal
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In today's economy, with fewer employees doing the work of many, why take time out of a busy
schedules to write employee performance appraisals? Isn't it just a waste of time that puts
everyone further behind on their daily "To Do" list? From a manager's point of view, the goal of
the performance appraisal should be more than an opportunity to document specific criteria for
salary increases, promotions or disciplinary actions—it should also involve ongoing
communication, setting achievable goals with clear expectations and having a plan of action for
the next period. It is important to take the time away from imminent deadlines to write an
effective employee performance appraisal because of a host of benefits:
Motivates your employees. Give employees a clear understanding of what's expected of them by
setting goals, establishing timelines, tracking progress, and identifying obstacles to their
individual goals.
Recognizes and compensates top performers. Track employee progress against performance
goals to identify who is contributing most to the success of your business and reward them for
exceptional effort.
Reduces employee turnover and attrition. Help employees be more successful by providing them
with clear goals that support your company's objectives and encourage retention by creating a
pay-for-performance structure that rewards your top performers appropriately.

2. Protects yourself legally. Document with a detailed paper trail to build an airtight case should
you need to terminate an individual due to unsatisfactory performance. Now that you know why
they are important, the next question is how do you write an effective employee performance
appraisal? The following tips will help you construct performance appraisals that are efficient,
focused and beneficial to everyone.
Set Individual Goals Effectively
Setting goals is a collaborative activity between a manager and his or her employee. The
manager communicates company and departmental objectives to the employee and based on this
information, the employer and employee together create successfully achievable goals that are
aligned with the company goals. Why waste time pursuing goals that are not aligned with those
of the company? This leads to a waste of resources and frustration for everyone involved.
The issue:
Camp Fire wanted an easy to use, non-intimidating performance management solution that
would align individual and team goals with the organization’s overall strategic plan, (updated
every three years) and instill confidence in the process by all—employees and managers alike. It
would replace their current Microsoft Word-based planning and review processes that were
cumbersome and made it difficult to make informed, quick changes to staffing of departments
and divisions.
The solution:
All manager's and their direct report's goals, objectives, and actions are incorporated in a single
list, enabling visibility amongst employees that share the same final goals, but have different
action steps to achieve those objectives. With one click, managers see all direct reports' action
steps and can assess performance based on individuals' rolls in contributing to completing shared
objectives. The easy-to-use system, with email notifications and centralized data, greatly reduced
time necessary to complete the goal setting and performance review process and added value to
the information gathered.
The result:
SuccessFactors enabled Camp Fire to tighten up procedures related to the employee appraisal
system and brought much-needed consistency. The new online management system saved Camp
Fire USA a significant amount of time, made the HR appraisal process more thorough and has
resulted in improved attitudes toward the performance assessment process.
"We are a non-profit, but we are also a business, and need to be high performing like any other
business. Now, where people used to dread planning and reviews, they actually look forward to
it."

3. Make it an ongoing process—not just once a year
Managers need to be available and check in with their employees on a regular basis to give
feedback and / or coaching as necessary. They should be made aware of any obstacles that may
keep their employees from achieving these established goals. If there are obstacles, the manager
and employee can create a plan to overcome them, such as reviewing the skill development or
training necessary to be successful or evaluate the current available resources to identify whether
additional resources are required. Performance monitoring, feedback and coaching creates a
separate feedback loop within the larger loop which should take place more than an annual
review, allowing for changes as necessary.
Use multiple resources for the employee performance appraisal
The employee performance appraisal needn’t be done in a vacuum—it is important for a
manager to solicit multiple viewpoints on the employee's performance, including a self-
assessment from the employee. This type of appraisal is called a 360-degree review.
Members of the company who may be involved in a 360-degree review include supervisors, top
management, subordinates, co-workers and representatives from other departments who interact
with the employee. In fact, anyone who has useful information on how the employee does the
job, even customers and clients may be a source in the appraisal, providing a broader view of the
employee's performance.
By doing this, managers receive valuable feedback on an employee’s performance because
fellow team members often know more about each other's day-to-day performance than the
direct supervisor. At the same time, this open process can add to an employee’s job satisfaction
and potentially reduce turnover.
Make the process easy and efficient
Design the performance process to work for you. The performance management process must
add value; otherwise you will face resistance problems such as missing deadlines and non-
participation, thus creating a headache for your HR department. In addition, the process itself
must be efficient and as simple as possible, while still providing the necessary value. Automated
reminders and scheduling tools can help keep the process on track. This leads us to the
consideration of a fully automated process.
An automated process streamlines the process because all parties have access to a centralized
document location and can use email to gather necessary information or solicit feedback. Cost

4. savings are evident through the lack of printing multiple copies of various forms and efficiency
due to all members of the team being able to work on centrally located documents. Additionally,
companies that switch to a paperless process establish a "greener" profile which is becoming
increasingly important to consumers.
Conclusion:
When written effectively, employee performance appraisals do fill a good strategic business
need. They allow us to communicate company and individual goals and put in place the
guidelines for a pay-for-performance system that rewards employees for successfully achieving
those goals. These appraisals are tools that have the ability to make us all more productive and
engaged in our jobs and therefore make our companies more successful.
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III. Performance appraisal methods
1.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
i. Employees are ranked according to their performance
levels.
ii. It is easier to rank the best and the worst employee.
Limitations of Ranking Method
i. 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.
ii. 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.
iii. When a large number of employees are working, ranking
of individuals become a difficult issue.
iv. There is no systematic procedure for ranking individuals

5. in the organization. The ranking system does not eliminate
the possibility of snap judgements.
2. 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 – Rater’s biases
3. 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
4. Critical Incidents Method

6. 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.
5. 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.
6. 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.

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