Need for Employee Appraisal System in an Organization

…what we mean "Employee Appraisal Systems"

The purpose of performance management is to help and encourage everyone to raise their performance, develop their abilities, increase job satisfaction and achieve their full potential on desire level skill set of an individual to the benefit of the individual and the organization as a whole.

Performance appraisal is the one of the most important way by which an organization can understand its employees and evaluate their desiring skill set to perform a specific task. A good employee appraisal system helps an organization to understand its human capital needs and its weakness. It also highlights an individual’s weakness and strength. With the help of different appraisal technique an organization can achieve the organizational objectives, individual objectives and also mutual objectives.

…. Why we need appraisal?

To achieve the company objective

…for better performance and to overcome the weaknesses with best of our knowledge and ability

The objective of evaluation of employees is to identify the performance gap. Performance gap can be analyzed by identifying the gap between the employee’s actual performance and that required by the organization.

All organization use employee appraisal system in one way or the other. It’s the traditional way to evaluate the performance of employees. The main objective of Performance appraisal is evaluation of employees and to use it as feedback system.

The main objective of feedback system is to inform the employee about his work performance. It is an interactive session between the employee and his superiors where an employee can speak about his problems without any fear.

… from organization point of view

And from the view point of an organization it highlights manpower information, improve efficiency and effectiveness and provide a rational compensation structure.

….from employee point of view

From the view point of an individual a performance appraisal should be about his self analysis, his work analysis, how to improve himself and the rewards for doing well.

On a whole Employee appraisal system is about mutual goals, it emphasizes on individual growth as well as organization growth, helps to improve the productivity of the employees and employee retention in the organization and profitability.

Techniques of employee appraisal system

Techniques for employee appraisal depend on organization to organization. One technique which is appropriate for your organization will not be appropriate for another. Many organizations follow traditional methods like Confidential Report method, where a superior evaluate an employee on basis of loyalty, intelligence, character and his work. But this type of method is often biased resulting in dissatisfaction and misunderstandings among employees which hamper their productivity.

Some organization follows Scalar rating system or numerical or Ranking method, whereby managers are asked to rate an employee against a number of objectives or attributes. Again this method leads to biased among the employees.

Some organization follows 360 degree appraisal system, whereby an employee receives assessments from his/her mangers, peers, subordinates and customers while also performing a self appraisal.

And there is another nice technique which an organization follows for employee appraisal is MBO, whereby managers and other superior’s chalk out a task for an employee which he had perform. The tasks which are set are easily achievable and time bound and most importantly it should be coordinated with the goal of the organization.
Depending on his performance, the goals for the employee are set and modified.

Benefits and advantages for adopting employee appraisal system

It increases productivity and efficiency of the employee
Increases retention of employees
Identify the strength and weakness of an employee
Identifies the gap between the performance of an employee and desired performance of an organization
Everyone is clear about corporate goals and work towards them
Build closer working relationships based on mutual trust and respect
Identify individual training and development needs
Recognize individual contribution
Introduce relevant and effective learning and development programmes to meet identified needs
Identify areas of individual concern and provide guidance to enable individuals to make the best use of their abilities
Guide individual and team effort to meeting overall business needs

Employee appraisal process can sometimes become a challenging process for any organization, so to make the process easier we have developed a software for appraisal management. It automates the HR processes, saves time and cost, reduces the risk of mistakes and at the same time increases the efficiency of HR personnel. It can be customized for meeting specific needs of any organization.

Need for employee appraisal system
Employee appraisal system