The document provides an introduction to performance appraisal, detailing its methods, benefits, and importance in fostering a corporate culture that values employee contributions. Key points include establishing compensation guidelines based on performance, tracking employee strengths and weaknesses, identifying promotion candidates, and offering constructive feedback and training opportunities. Various performance appraisal methods such as ranking, rating scales, and critical incidents are discussed, each with its advantages and limitations.

1. Introductionof performance appraisal
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I. Contents of getting introduction of performance appraisal
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Regular performance appraisals help create a corporate culture that promotes personal success,
along with collaboration. Individual employees need the reinforcement of knowing that their
contributions are valued by upper management. The appraisal process offers several benefits
organizationally, generating an atmosphere of excellence. Performance appraisals allow
management personnel to establish guidelines for compensation increases; track employee
strengths and weaknesses; identify the best candidates for promotion; offer feedback for
improvements; and promote training programs.
1. Establishing compensation guidelines
Employee compensation should be directly tied to performance. Employees that go above and
beyond the call of duty normally receive higher annual increases than employees that do the bare
minimum. Compensation is the single best way to reward exemplary job performance. The only
way to consistently track exception performance is through an appraisal process. Regular, one-
on-one, discussions about an employees execution of job responsibilities helps when assessing
the year for those in different raise brackets.
2. Track strengths and weaknesses
No one person determines an organizations success. Different workers bring their experience
and strengths to the table, allowing projects to succeed with minimal delays. Identifying the
right candidates for the right teams is a crucial part of successful management. The best way to
ensure the right workers come together is to track individual strength and weaknesses.

2. Consistent performance appraisals make that information easily accessible when it is time to
hand out new assignments.
3. Identifying promotion candidates
Hiring from within an organization keeps organizational memory strong, allowing for continuity
of management styles. Unfortunately, not every applicant has the skill set needed to make the
transition to a higher position. Quarterly, or even annual, appraisals allow hiring managers to
look back over the applicant’s entire work history and find the best internal candidates for a
promotion.
4. Offer feedback
Constructive criticism provides employees with the necessary information to improve their on-
the-job performance. Good managers give feedback that motivates employees to strive for
improvement. Employees informed about performance expectations are better able to meet the
challenges of excellence. By giving employees feedback about their performance on a regular
basis, managers open up the lines of communication, enabling a good working relationship and
encouraging a spirit of collaboration. Employees and managers work together to tackle the
roadblocks to success.
5. Introducing training programs
Performance reviews offer an excellent time to discuss additional training and continuing
education requirements. Professionals need to stay up-to-date on industry best practices. The
only way to ensure this happens, is to track training and offer programs internally. Not only do
training programs help keep employees current on new policies and procedures, they also help
keep employees on the cutting edge of technology. Office software, project management
solutions and even management philosophies change as businesses adapt to changes in the
marketplace. The success of an organization depends on every member, making training an
integral part of continued success.
The give and take of a formalized performance review system allows employees to feel
comfortable during their daily work activities. They receive positive reinforcement for a job
well done and corrections when necessary to correct bad work habits. It is important for
employees to know where they stand in their workplace. Work environments bring enough
stress, without the added worry about performance. Communication forms the foundation for all
lucrative business interactions. Formalized policies detailing how an employee’s performance is
graded lower stress levels, allowing employees to reach their full potential. The summarized
information gathered during reviews also helps streamline many management activities. Hiring,
firing, compensation determinations and training schedules all become part of the review
process, minimizing the necessary oversight for these tasks. Implement regular performance
reviews and see immediate benefits to productivity and job satisfaction.

3. ==================
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
in the organization. The ranking system does not eliminate
the possibility of snap judgements.
2. Rating Scale

4. 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
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. 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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