2. Potential Appraisal
Potential refers to abilities of an employee which are currently not brought to use by an
organization. Potential means the talent capacity to undertake higher challenges on job in future.
The potential appraisal refers to the appraisal involving identification of the hidden talents and
skills of a person. The person might or might not be aware of them.
Potential appraisal is a future-oriented appraisal whose main objective is to identify and evaluate
the potential of the employees to assume higher positions and responsibilities in the
organizational hierarchy
In the modern era of human resource management, appraisal system lays greater emphasis on
the development of employees rather than on their evaluation.
3. Potential appraisal vs. Performance
appraisal
Potential Appraisal is forward looking process whether performance appraisal is
backward looking process. Potential includes the possible knowledge, skills, and
attitudes the employee may possess for better performance.
Any good or worse assessment results of performance appraisal may not be a
good factor for potential appraisal. But current performance of an employee could
show evidance somewhere whether he/she is flexible for new working conditions.
4. Purpose
To inform employees of their future prospects;
To enable the organisation to draft a management succession programme;
To update training and recruitment activities;
To advise employees about the work to be done to enhance .their career
opportunities.
5. Requirements for Potential Appraisal
1. Role/Job Description: A good potential appraisal system would be based on clarity of roles
and functions associated with the different roles in an organisation. This requires extensive job
descriptions to be made available for each job. These job descriptions should spell out the
various functions involved in performing the job.
2. Qualities Required: it is necessary to have a detailed list of qualities required to perform each of
these functions.
technical knowledge and skills,
managerial capabilities and qualities,
behavioural capabilities, and
conceptual capabilities.
6. Cont..
3. Indicators of Qualities: Besides Job description and qualities required, mechanism for judging
these qualities is important. Some are:
Rating by others,
Psychological tests,
Simulation games and exercises,
Performance appraisal records.
4. Organising the System: Once above listed are in place, PA can be applied but such establishment
requires clarity in organisational policies and systematisation of its efforts.
7. Cont..
5. Feedback: Organisation should attempt to generate a climate of openness. Such a
climate is required for helping the employees to understand their strengths and
weaknesses and to create opportunities for development.
Employees should be helped to understand the qualities actually required for
performing the role for which he thinks he has the potential, the mechanisms used by
the organisation to appraise his potential, and the results of such an appraisal.
8. Competency Mapping
Competency mapping is the process of identifying the specific skills, knowledge,
abilities, and behaviours required to operate effectively in a specific trade,
profession, or job position.
12. BALANCED SCORECARD
It was originally published by Dr Robert Kaplan and Dr David Norton as a paper in 1992. And
then formally as a book in 1996.
A balanced scorecard is a performance metric used to identify, improve, and control a
business's various functions and resulting outcomes.
BSCs were originally developed for for-profit companies but were later adapted for use by
non-profits and government agencies.
The balanced scorecard is a management system aimed at translating an organization's
strategic goals into a set of organizational performance objectives that, in turn, are measured,
monitored and changed if necessary to ensure that an organization's strategic goals are met.
15. The scorecard can provide information about the firm as a whole when viewing
company objectives. An organization may use the balanced scorecard model to
implement strategy mapping to see where value is added within an organization.
This can be done by assigning tasks and projects to different areas of the company
in order to boost financial and operational efficiencies, thus improving the
company's bottom line.
16. Characteristics of BSC
Learning and growth: how well information is captured and how effectively employees
use that information to convert it to a competitive advantage within the industry.
Business processes: analyze track gaps, delays, bottlenecks, shortages, or waste.
Customer perspectives: to gauge customer satisfaction with the quality, price, and
availability of products or services. Customers provide feedback about their satisfaction
with current products.
Financial data: such as sales, expenditures, and income are used to understand financial
performance. These financial metrics may include dollar amounts, financial ratios, budget
variances, or income targets.
