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1. Objectives for performance appraisal
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I. Contents of getting objectives for performance appraisal
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Performance appraisal systems identify the top performers in a business by systematically
evaluating their performance and progress on a regular basis. Performance appraisal systems can
take on a variety of forms, utilizing different theories of employee motivation and employee
development. All effective performance appraisals are tied to specific, measurable and attainable
objectives put in place to push employees to a higher level of individual and team performance.
Productivity/Output
Productivity is the fundamental asset employees bring to the employment relationship. In its
most basic form, an employment contract is an agreement to exchange money in return for
productive time, so working to increasing employees' productivity can be a way for companies to
get the most out of their salary and wage expenses. Productivity objectives usually can be tied to
measurable results, such as the number of units produced per day on a production line or the
number of entries made per day in a data-entry position.
Mistakes/Waste
Increasing productivity can come at the expense of product quality. Some employees may not
have an issue with the speed of their work, but they may have an issue with the quality of their
contributions on the job. Performance appraisals can identify and address employees who make
an unusually high number of mistakes. This costs companies money in industries such as food
service, where mistakes literally are thrown in the garbage. Mistakes on the job can incur
opportunity costs from lost productivity in other settings.

2. Companies can measure mistakes in much the same way as productivity. You might decide to
measure the number of defective units produced each day, for example, or the number of
typographical errors made by a data-entry clerk.
Individual Goals
The most effective performance appraisal systems involve a collaborative goal-setting process
between employees and their supervisors. Employees and managers can work together to
develop personal objectives for each employee. Some employees may set a goal of being on time
to work more reliably, for example, or of taking on new work tasks. Paying individual attention
to each employee when setting goals can boost workers' commitment to achieving appraisal
objectives.
Employee Development
Employee development programs facilitate employees' personal and professional growth through
advanced training and opportunities to take on new responsibilities. Performance reviews can be
an ideal setting in which to set objectives for achievement in employee development initiatives.
For example, employees may set a goal of completing a management training course in the next
year or of learning a certain number of additional responsibilities in their department before the
next performance review.
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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

3. 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
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. 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. 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

5. 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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