Performance Evaluation/Appraisal (PA)

Performance Evaluation is a method of evaluating the behaviour of employees in the work spot,normally including both the quantitative and qualitative aspects of job performance. Performance here refers to the degree of accomplishment of the tasks that make up an individual’s job. It indicates how well an individual is fulfilling the job demands. Performance is always measured in terms of results. A student,for example, may exert a great deal of effort while preparing for the examination but may manage to get a poor grade. In this case,the effort expended is high but performance is low. Job performance can be observed by immediate supervisor,subordinates,self-appraisal,customers served,and computers.

performance appraisal

Performance Appraisal is the systematic evaluation of the performance of employees and to understand the abilities of a person for further growth and development. It also referred to as a performance reviewperformance evaluation.


According to __Dale S. Beach, “Performance appraisal is systematic evaluation of the individual with respect to his or her performance on the job and his or her potential for development“. 

According to__Randall S. Schuler, Performance appraisal is a formal, structured system of measuring and evaluating an employees job, related behaviour and outcomes to discover how and why the employee is presently perfuming on the job and how the employee can perform more effectively in the future so that the employee, organisation, and society all benefit.” 

According__Flippo,”Performance appraisal is defined as a systematic,periodic and so far as humanly possible,an impartial rating of an employee’s excellence in matters pertaining to his present job and to his potentialities for a better job”.

Advantages of Performance Appraisal

  1. Promotion: It helps the supervisors to chalk out the promotion programmes for efficient employees. In this regards, inefficient workers can be dismissed or demoted in case.
  2. Compensation: It helps in chalking out compensation packages for employees. Merit rating is possible through performance appraisal. Performance Appraisal tries to give worth to a performance. Compensation packages which includes bonus, high salary rates, extra benefits, allowances and pre-requisites are dependent on performance appraisal. The criteria should be merit rather than seniority.
  3. Employees Development: The systematic procedure of performance appraisal helps the supervisors to frame training policies and programmes. It helps to analyse strengths and weaknesses of employees so that new jobs can be designed for efficient employees. It also helps in framing future development programmes.
  4. Selection Validation: It helps the supervisors to understand the validity and importance of the selection procedure. The supervisors 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.
  5. Communication: For an organization, effective communication between employees and employers is very important. Through performance appraisal, communication can be sought for in the following ways:
    1. Through performance appraisal, the employers can understand and accept skills of subordinates.
    2. The subordinates can also understand and create a trust and confidence in superiors.
    3. It also helps in maintaining cordial and congenial labour management relationship.
    4. It develops the spirit of work and boosts the morale of employees.

6. Motivation: Performance appraisal serves as a motivation tool. Through evaluating performance of employees, a person’s efficiency can be determined if the targets are achieved. This very well motivates a person for better job and helps him to improve his performance in the future.

Objectives of Performance Appraisal

  1. To identify the strengths and weaknesses of employees to place right men on right job.
  2. To maintain and assess the potential present in a person for further growth and development.
  3. To provide a feedback to employees regarding their performance and related status.
  4. To provide a feedback to employees regarding their performance and related status.
  5. It serves as a basis for influencing working habits of the employees.
  6. To review and retain the promotional and other training programmes.