Performance appraisals enable business organizations to achieve the best results, through managing their employees.
So what is PA? PA is the systematic evaluation of the individual, with respect to the persons’ performance on the job and potential for development. It is the process of evaluating the performance and qualifications of the employees in terms of the requirements of the job, for purposes including placement, selection for promotions, providing financial rewards, and other actions
What are its advantages?
- Promotion: PA helps the supervisors mark out the promotion programs for efficient employees
- Compensation: PA helps in marking out compensation packages for employees which include bonuses, salary rates, extra benefits, allowances and pre-requisites. The criteria should be merit rather than seniority
- Employee development: The systematic procedure of PA helps the authority frame training policies and programs. It helps to analyze strengths and weaknesses of employees so that new jobs can be designed for efficient employees. It also helps in framing future development programs
- Selection validation: PA helps the authority understand the validity and importance of the selection procedure. The authority come to know the validity and thereby the strengths and weaknesses of selection procedure. Future changes in selection methods can be made in this regard
- Communication: Through PA, employers can understand and accept skills of subordinates. The subordinates can also understand and create trust and confidence in superiors. It develops the spirit of work and boosts the morale of employees
- Motivation: Through evaluating performance of employees, a person’s efficiency can be determined if the targets are achieved. This motivates a person for doing a better job, and helps to improve performances in the future
Establishing PA standards and communicating these standards to employees may prevent further misunderstandings. The standards should be in writing, clearly defined to the employee and consistently applied across the company.
It is important that measurements must be objective based on data, rather than interpretations or perceptions. For example, in measuring safety, the number of accidents would be a valid measurement. PA can achieve goal which include:
- Define goals clearly
- Provide real-time feedback
- Enhance employee performance
- Spot training and development needs
- Offer insights on counter-productive tasks
- Improve employee engagement and retention
- Align individual performance with business goals
- Transform the workforce into a strategic advantage
The law requires that the PA of a corporation be job-related and valid, based on a thorough analysis of the job, standardized for all employees, not biased against any race, colour, sex, religion, or nationality, and performed by people who have adequate knowledge of the person or job. The process should be clearly described in a personnel policy.
The feedback in the PA process refers to feedback on an employee’s performance being provided by the manager, different people, or departments an employee interacts with, peer evaluation, and external customers. This type of feedback includes employee-generated feedback on management performance, also known as upward appraisals. Small business owners or managers can either include the feedback in the performance review or choose to provide it informally for development purposes.
Employee PA management may be even more exciting and valuable with an adequate solution through the right PA method. In my view, PA adds value to the performance of an organization; it also contributes to employee satisfaction because they are at least reviewed as opposed to no appraisal at all.
Taslim Ahammad is Assistant Professor, Bangabandhu Sheikh Mujibur Rahman Science and Technology University.
