Essay: Performance Appraisal
Performance appraisal is used in any firm regardless of its size in efforts to realize a number of human resource management objectives. Due the varying tools used in performance appraisal, there has resulted confusion on its real meaning. Through performance appraisal, the management of a firm is able to evaluate the behavior and accomplishments of individual employees. There are three basic objectives of performance appraisal. The first one is administration in which the management of a firm will be able to determine salary increases, transfers and promotions. Through performance appraisal, the management is able to get information on the performance of each individual employee.
The management can also be able to motivate its employees thus increasing their efficiency and commitment. In the firms where performance appraisal may be bias, employees loose morale to work leading to high turnover rates. Performance appraisal can fail if the employees are not well informed of what is expected of them, lack of enough training for the management on how to appraise, ineffective communication in the performance process (Kumar, 2005).
The basic steps of conducting employee performance are setting the performance standards and expectations, appraising performance of each employee by comparing the actual performance with the set standards and lastly providing the feedback to both the employees and the management and thus plan for the future development. The best performance appraisal methods include technology based, MBO (management by objective), behaviorally anchored rating scale, critical incident, forced distribution and graphic rating scale. A number of rater errors may arise in the performance appraisal process if it is not planned strategically. These include Similar-to-Me Bias, Recency Effect, Appraisal Bias, Leniency or Strictness, Central Tendency and Halo Effect. For the performance appraisal process to be effective, it should be planned strategically, all the problems that may arise are controlled and all the parties involved in the process be adequately communicated to.