Performance appraisals are the tools that are constantly used by the company in order to measure and quantify the performance of an employee and also identify how the performance can be improved. The potentiality of the performance appraisal can be quantified based upon the how a company achieves the strategic objectives. Getting a knowledge of the strategic objectives with respect to the performance appraisals can help anybody to adapt to the changes and meet the needs of the company (Dusterhoff, Cunningham & MacGregor, 2014).
Improves the morale of the employees and staffs- boosting the morale of the employees is an important factor when the creation of a creative workforce is an important part. Studies have indicated that the motivation of employees and the morale of the company improves when the programs related to performance appraisals are executed properly. Managers help the employees to identify their weaknesses and the weak points related to the job performance, thus creating a plan for such employee to combat their weakness can provide a positive feeling to the employees. This can, in turn, helps the company to achieve its goals. Thus, this is one of the main reason to highlight the positive parts in the performance reviews and then transform the negatives of the employees into positives and provide a helping hand for the employee development (Selvarajan & Cloninger, 2012).
Budgeting tool- Food and Agricultural through a study have concluded that performance appraisal is utilized as a vital tool in the business process. The performance appraisals provide a company with an opportunity to point out which employee needs a raise and which employee does not. The other form of the employee performance appraisal involves the employee termination and this takes into the account the organizations budgetary considerations. Then the company thinks of how to fill the vacant place. Whether to bring an experienced candidate and pay more salary or to hire an employee with less skill and assist that employee to serve the strategic goals of the company (Lawler III, Benson & McDermott, 2012).
Setting goals- the most vital part for any company is to reach for the strategic goals. These can be like an increase in the percentage of the revenue earned and the establishment of the performance metrics. It is important to highlight that, performance evaluation is the time when the employees and the managers discuss the strategic goals of the company and the professional development of the employees (Cardy & Leonard, 2014).
From the above discussion, it can be concluded that the performance appraisal is a vital part when it comes to boosting the morale of the employees, improve the company condition and setting strategic goals of the company. Performance appraisals also used as budgetary tools and setting goals
Introduction
Businesses around the world use the performance appraisal tool to effectively identify the organizational goals, communicate with others, increase the jo scope, achieve goals. When the appraisal schemes are selected properly, then the employees can perform effectively. However, the evaluators that are conducting the performance appraisals must conduct the same fairly and properly so that the employees do not push back and create a pitfall situation (Chattopadhayay & Ghosh, 2012).
Limited perspective- the traditional tools that are employed by the managers generally involve the evaluation of the performance of the employees based on the reports. This is a major drawback of the procedure because the manager is focussing only on the results and not on the hard work that the employee has devoted to his or her work. The manager is unable to see the roadblocks and obstacles the employees are facing (Prieto & Pilar Pérez Santana, 2012).
Erosion of the motivation- several companies have been seen that they use the performance appraisals only during the pay increase. During the appraisal, only the strong points are highlighted and the weaknesses are not taken into account (Prieto & Pilar Pérez Santana, 2012).
Time-consuming- most of the performance appraisal procedures are cumbersome and include a lot of effort from the mangers. The utilization of the appraisal models requires proper training of the evaluators and this takes around more than two weeks depending on the size of the company (Espinilla et al., 2013).
Conclusion
From the above discussion, it can be concluded that the performance appraisals if not conducted properly then a lot of issues arise and this could even erode the morale of the employees, and intron hampers the growth of the company.
The post shared by Anupama Prasai shares some of the vital points. The important part of the post is that the upper management sections set the organizational goals and the employees have to work accordingly so that the organization can achieve their goals. The organizational goal itself acts as a benchmark which for the employees and this benchmark is used to gauge and measure the employee performance. The next big information provided in the post is that the employees get motivated positively due to the performance appraisal. It is an established fact that the employees get motivated when they see that their efforts are not going unnoticed and they are getting proper acclamation (Jiang et al., 2012). Also, it is important to note that the employees if do not get remunerated properly, then they get demotivated and lose interest from work. However, the high hopes of the employees are often turned down by the upper management. The last point mentioned by Anupama Prasai highlight the fact that performance appraisal creates a sense of the positive working environment in the workplace and the employees compete among themselves to reach to the top. This gives a positive sign of healthy competition (Grigoroudis, Tsitsiridi & Zopounidis, 2013).
Maria Ventura has highlighted that the positive impact of performance appraisal is seen at multiple levels. The benefits are accrued by the employees, organization and the ones that are being served by a company. Organizations often have their own performance appraisal models that are framed by the management for maintaining a level of work culture. It has been seen in a certain organization that they constantly monitor their employee and keep a watch on the performance of the employees (Daoanis, 2012). This can effectively help the employees to get a glimpse of their weakness. Also, it is a correct fact that when the performance appraisals are not conducted properly, then management faces a backlash in form of employee dissatisfaction. However, this sort of discrepancy and discrimination can be improved through a well-designed appraisal system. Some issues that are often seen in illegitimate performance appraisals methods are low expectations, double standards and stereotyping (Gupta & Kumar, 2012).
Reference
Cardy, R., & Leonard, B. (2014). Performance Management: Concepts, Skills and Exercises: Concepts, Skills and Exercises. Routledge.
Chattopadhayay, R., & Ghosh, A. K. (2012). Performance appraisal based on a forced distribution system: its drawbacks and remedies. International journal of Productivity and performance Management, 61(8), 881-896. DOI: https://doi.org/10.1108/17410401211277138
Daoanis, L. E. (2012). Performance Appraisal System: It’s Implication to Employee Performance. International Journal of Economics and Management Sciences, 2(3), 55-62. Retrieved from: https://pdfs.semanticscholar.org/c716/802af3a90064ca0dc196578574e07b5e79df.pdf
DOI: https://doi.org/10.1007/s10551-013-1634-1
Dusterhoff, C., Cunningham, J. B., & MacGregor, J. N. (2014). The effects of performance rating, leader–member exchange, perceived utility, and organizational justice on performance appraisal satisfaction: Applying a moral judgment perspective. Journal of business ethics, 119(2), 265-273.
Espinilla, M., de Andrés, R., Martínez, F. J., & Martínez, L. (2013). A 360-degree performance appraisal model dealing with heterogeneous information and dependent criteria. Information Sciences, 222, 459-471. DOI: https://doi.org/10.1016/j.ins.2012.08.015
Grigoroudis, E., Tsitsiridi, E., & Zopounidis, C. (2013). Linking customer satisfaction, employee appraisal, and business performance: an evaluation methodology in the banking sector. Annals of Operations Research, 205(1), 5-27. DOI: https://doi.org/10.1007/s10479-012-1206-2
Gupta, V., & Kumar, S. (2012). Impact of performance appraisal justice on employee engagement: a study of Indian professionals. Employee Relations, 35(1), 61-78. DOI: https://doi.org/10.1108/01425451311279410
Jiang, K., Lepak, D. P., Han, K., Hong, Y., Kim, A., & Winkler, A. L. (2012). Clarifying the construct of human resource systems: Relating human resource management to employee performance. Human resource management review, 22(2), 73-85. DOI: https://doi.org/10.1016/j.hrmr.2011.11.005
Lawler III, E. E., Benson, G. S., & McDermott, M. (2012). What makes performance appraisals effective?. Compensation & Benefits Review, 44(4), 191-200. DOI: https://doi.org/10.1177%2F0886368712462331
Prieto, I. M., & Pilar Pérez Santana, M. (2012). Building ambidexterity: The role of human resource practices in the performance of firms from Spain. Human Resource Management, 51(2), 189-211. DOI: https://doi.org/10.1002/hrm.21463
Selvarajan, T. T., & Cloninger, P. A. (2012). Can performance appraisals motivate employees to improve performance? A Mexican study. The International Journal of Human Resource Management, 23(15), 3063-3084. DOI: https://doi.org/10.1080/09585192.2011.637069
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