What is Performance Appraisal?

  • Print this article
What is Performance Appraisal? thumbnail
What is Performance Appraisal?

Performance appraisals are a valuable performance management tool to evaluate the performance and value employees provide as well as set goals for the next review period. Most companies conduct performance appraisals annually, but they may also be done after a new hire completes the first 90 days of employment or on a monthly basis in situations where performance is an issue.

  1. History

    • Formal performance appraisal has its origins in Frederick Winslow Taylor's 1911 Time and Motion work, which used the scientific method to assess and improve worker productivity. In 1960, the Theory of X and Y was introduced to categorize employees. With X employees, performance appraisals are income-justification exercises. With Y employees, they are a cooperative exercise in aligning personal and professional goals. Currently, management favors the Y employee model and uses performance appraisals to develop skills and talent.


    • There are a variety of performance appraisal types as well as variances in terminology, but the most common performance appraisal types are: rating scales, essay methods, results oriented (also known as Managing By Objective). Rating scales are the most popular type of performance appraisal followed by the essay and results oriented appraisal formats. Regardless of the performance appraisal type the main purpose of an appraisal is to encourage and develop employees, facilitate corporate goals, identify improvement areas and training needs.

    Rating Scale

    • Rating scales are a structured appraisal of employee performance and, as their name suggests, use a scale to grade work quality. Scales may be numeric or rate from poor to excellent. While rating scales are objective in their format, their use is subjective and open to supervisor interpretation. In addition, their inflexibility can be problematic if a problem or achievement area is not included on the scale because both good and poor performance can slip under the radar.


    • The essay method of performance appraisal involves a supervisor writing a paper outlining employee strengths, weaknesses, goals and objectives. A supervisor can introduce any topic at his discretion and there are no limits or objective metrics to ensure the performance appraisal is appropriate or productive. The subjective nature and freedom of essay appraisals could open the door to employee contention and legal liability if a supervisor is not well-informed on employment law. In addition, a study published by the European Journal of Social Sciences found the essay appraisal to be the least effective appraisal method (see References for a link to the study).

    Results Oriented

    • Results oriented or Managing by Business Objective (MBO), is a metric based performance appraisal method that focuses on work outcome. Employee performance is judged primarily on goal achievement. Managing by Business Objective is considered to be the most objective and effective appraisal method, but the emphasis on measuring performance can result in inappropriate goals. For example, once an employee reaches 100% on a given metric, it would typically be unproductive to set a new goal of 150%.

    Preparing for a Performance Appraisal

    • Employees should track their goals throughout the year, documenting their professional achievements and performance as much as possible. Prior to a performance appraisal, they should informally discuss their work performance with their supervisor to avoid surprises and make suggestions on goals for the next review period. Proactive communication is the best way to positively influence performance review outcome and most supervisors are pleased when their staff partners with them to assist with the review process.

Related Searches


  • Photo Credit cenglanddesigns


You May Also Like

  • What Is a Performance Evaluation?

    A performance evaluation serves many purposes for an employee, supervisor and organization. Evaluations are utilized to determine whether employees are meeting ...

  • How to Review Performance Appraisals

    Performance appraisals are used to provide insight on how successfully an employee is performing his job. The manager takes into consideration the...

  • What Is the Purpose of a Performance Appraisal System?

    Employers conduct performance appraisals to estimate employees' worth. During this process, the immediate superior prepares a report on the performance of his...

  • What Is an Annual Performance Appraisal?

    Annual employee performance reviews are often seen as a waste of time and a necessary evil. But they don't have to be....

  • Definition of Employee Performance Management

    Employee performance management is a program that corporate management uses to evaluate the current performance of employees and to help improve the...

  • What Are Performance Appraisals Used For?

    Performance appraisals are used by corporations to provide performance feedback to employees. They are conducted annually, quarterly, monthly or on a timetable...

  • What Is a 360 Degrees Performance Appraisal?

    Employee performance evaluations are a standard aspect of managing employees and are a key factor in decisions about promotions and salary increases....

  • What Are House Appraisals?

    If you are in the midst of selling or buying a house, one of the buzzwords you are probably hearing is "appraisal."...

  • What Is the Appraisal Value for a Home?

    An appraisal value for a home is an educated approximation of the home's market value based on a variety of criteria including...

  • About Company Performance Appraisals

    Performance appraisals are methods companies use to measure employee performance. Based on the business size, industry and categories of occupations, the type...

  • Software for Performance Appraisal

    Many companies have moved documentation of their performance appraisal process from paper to electronic. Using a software program designed for performance appraisals...

  • The History of 360 Degree Feedback

    Three-hundred-and-sixty-degree feedback is a management tool and performance appraisal method that gives employees the opportunity to receive feedback from multiple ...

  • What Are Goal-Oriented Performance Appraisals?

    What Are Goal-Oriented Performance Appraisals?. ... and to get the best results from available resources through aligning work behavior, ...

  • Define Performance Appraisals

    Organizations use performance appraisals to gather information on employee behavior, capability and potential. A manager then discusses the results of the appraisal...

  • Definition of a Performance Appraisal

    Performance appraisal is the procuring, analyzing and documenting of facts and information about an employee's net worth to the organization. It aims...

  • The Essay Method of Performance Appraisal

    Managers preparing to write an essay appraisal spend ... managers and supervisors. While there are several methods for ... Types of Performance...

  • Self-Appraisal of Performance

    Companies periodically complete employee reviews to acknowledge staff members' contributions or provide constructive criticism for improving weaknesses. In some cases ...

  • Four Performance Appraisal Tools

    Human resources performance appraisal tools are specific methods supervisors use to evaluate employee performance. ... What is Performance Appraisal?

  • How to Use Excel to Create Performance Appraisals

    How to Use Excel to Create Performance Appraisals. ... Type "appraisal" or "performance review" into the Search box at the ... The...

  • Purposes of Performance Appraisals

    One of the main purposes of performance appraisals is to identify weaknesses in employee performance so a plan for improvement can be...

Related Ads

View Mobile Site