The document discusses the history, definition, objectives, and essential elements of performance appraisal, which evaluates employee job performance systematically and impartially. It outlines a six-step process for conducting appraisals, including establishing performance standards and measuring actual performance against these standards. Factors influencing appraisals, such as evaluator biases and employee loyalty, as well as types of corrective actions, are also addressed.

1. PERFORMANCE APPRAISAL
Aakanksha Dangwal
Ex. Researcher

2. Origin
• As old as mankind itself.
• Started in China. (AD 261-265)
• During World War I in USA, where Man to Man rating system given
in US Army to evaluate the performance of a person.

3. Definition
• Appraise : To make a formal judgment about the value of a person’s
work.
• Appraisal: Evaluation of Job perfomance for a specific time for a
perticular person.
• According to Flippo “Performance appraisal is the systematic,
periodic and an impartial rating of an employee’s excellence in
matters pertaining to his present job and his potential for a better
job.”
• Systematic : Evaluation by applying same approach so that the results
of different persons can be comparable.
• Periodic : Identification of KRA & goal setting is fixed for period
• Timely : awareness in prior about its timing. It must be on time.

4. OBJECTIVES
1) Facilitates Periodic performance review of employee.
2) To provide more clarity of job specification to employee.
3) Enable employee to understand gap between desired and current performance.
4) To provide coaching , counselling , career planning and motivation to subordinates.
5) To develop positive superior – subordinate relations and thereby reduce grievances.
6) To test the effectiveness of recruitment , selection , placement and induction
programme.
7) To provide information for decisions concerning pay, promotion & transfer etc.
8) To diagnose the strengths and weaknesses of individuals so as to identify further
training needs.
9) Integrate individual goal & firm’s goal.

5. ESSENTIALS OF APPRAISAL
• Mutual trust: to discuss matters frankly.
• Clear objectives: Measurable, time-bound, achievable.
• Training to evaluator : Training to remove any bias
• Documentation : Record of performance to refer in future.
Acts a s a proof. clear, & Objective format required.
• Open communication : to motivate employee to participate in process.
• Evaluation technique : appropriate according to firm.
• Evaluation crieteria: Focus on job related behavior.
• Feedback: Given as developmental approach rather judgemental.

6. FACTORS AFFECTING PA
• Value system of evaluator : Every person has their own value system &
socio-cultural environment.
• Loyalty : Some employee are loyal & some are not.
• Factors hindering: a)Past-record of the subordinate.
b)Ability of the subordinate to exercise influence at higher level.
c)Not considering overall performance but considering few incidence.
d)Level of achievement: Vast difference between education, skills &
expertise in Superior & subordinate.

7. Steps in Process of Performance Appraisal
The six steps involved in process of performance appraisal
are as follows:
1. Establish Performance Standards.
2. Communicate Performance Expectation to Employee .
3. Measure Actual Performance .
4. Compare Actual Performance with Standards.
5. Discuss the Appraisal with the Employee.
6. Initiate Corrective Actions

8. 1) Establish performance standards
• The managers must determine what outputs, accomplishments and
skills will be evaluated.
• It is evolved out of job analysis and job descriptions.
• Clear and objective to be understood and measured.
• Should not be expressed in vague manner such as “a good job” or “a
full day’s work” as these vague phrases tells nothing.
• Set to ensure achievement of departmental goals and objectives and
the organization’s overall strategy and objectives.
• They are based on the position, rather than an individual.
• They should be “SMART:” specific, measurable, achievable, relevant
and timebound.

9. 2. Communicate Performance Expectations to Employees
• Once the performance standards are established, this need to be communicated to
the respective employees so that they come to know what is expected of them.
• Past experience indicates that not communicating standards to the employees
compounds the appraisal problem.
• Here, communication means transference of information has taken place and
has been received and understood by the employees.
• In order to be effective, performance standards must be clearly communicated
and understood.
• Performance standards assume that an individual is competent, so initial and
corrective training should be factored into the performance management process.
• Specific training need can also be communicated to employee.

10. 3. Measure Actual Performance:
• The actual performance of the employee is measured on the basis of
information available from various sources such as personal
observation, statistical reports, oral reports, and written reports.
• Measurement must be objective based on facts and findings.
• Performance that is expressed in numeric terms—for example, cost,
quantity, quality, timeliness—is relatively easy to measure.
• Performance in the area of soft skills—for example, communication,
customer service and leadership—is more difficult to evaluate.
• The focus should be on measuring what matters rather than
measuring what’s easy to measure.

11. 4. Compare Actual Performance with Standards:
• The actual performance is compared with the predetermined
standards.
• This comparison may reveal the deviation between standard
performance and actual performance
• Determine the reason for deviation :
• Are the performance standard aligned with the given objective?
• Are the appropriate methods being used to attain the given
objective?
• Is the firm providing appropriate tools to complete given objective?
• Is the implementation of methods is being done in a correct way?

12. 5. Discuss the Appraisal with the Employee:
• Communicate and discuss the results with employee.
• One of the most challenging tasks because the manager is
expected to present an accurate appraisal in a constructive
manner.
• A discussion on appraisal enables employees to know their
strengths and weaknesses.
• Further it impact on employee’s future performance.
• The impact may be positive or negative.
• Sometimes management can ask employees to complete and
submit a self-evaluation prior to the appraisal meeting.

13. 6. Initiate Corrective Action:
Corrective action can be of two types:
A) Instant: deals primarily with symptoms.
corrects something right at a particular point.
B) Basic : Deals with the causes.
Asks how and why performance deviate.
Adjust the differences permanently.
Due to short of time manager do not prefer it &
provides instant corrective action.
• As performance gaps are identified, supervisors should take the
time to identify why performance is not meeting expectations and
determine whether the employee can meet expectations with
additional training or coaching.