1. Feedback -
This provides a structured format for the
discussion of performance issues on a regular basis. Feedback either reinforces
performance strengths, or provides the opportunity to discuss resolution of
performance deficiencies. As well, feedback isencouraged in both directions: as
such, employees are encouraged to prepare ratings of their supervisors.
2. Motivating Superior Performance:
Performance appraisal
helps motivate people to deliver superior performance in several ways. first
the appraisal process helps the employee to learn just what it is that the organisation
considers to be "superior". Second, since most people what to be seen
as superior performers, a performance appraisal process provides them with a
means to demonstrate that they actually are. Finally, performance appraisal
encourages employees to avioud being stigmatized as inferior performance.
3. Setting and Measuring Goals:
Goal setting has
consistently been demonstrated as a management process that generates superior
Performance. The performance appraisal process is commonly used to make sure
that every member of the organisation sets and achieves effective goals.
4. Counseling poor performers:
Not every one meets the
organisation's standards. Performance appraisal forces mangers to confront
those whose performance is not meeting the company's expectations.
5. Determining compensation changes: This is another
classic use of performance appraisal. Almost every organization believes in pay
for performance. But how can pay decisions be made of there is no measure of
performance? Performance appraisal provides the mechanism to make sure that
those who do better work receive more pay.
6. Encouraging coaching and mentoring :
Managers are
expected to be good coaches to their team members and mentors to their
protégés. Performance Appraisal identifies the areas where coaching is
necessary and encourages managers to take an active coaching role.
7. Supporting Manpower Planning:
Well-managed
organisations regularly assess their bench strength to make sure that they have
the talent in their ranks that they will need for the future. Companies need to
determine who and where their most talented members are. They need to identify
the departments that are rich with talent and the ones that are suffering a
talent drought. Performance Appraisal gives companies the tool they need to
make sure they have the intellectual horsepower required for the future.
8. Determining Individual Training and Development Needs:
If the performance appraisal procedure includes a requirement that individual
development plans be determined and discussed, individuals can then make good
decisions about the skills and competencies they need to acquire to make a
greater contribution to the company. As a result they increase their chances of
promotion and lower their odds of layoff.
