Does Performance Appraisal process will be a challenge for an Organization?

What is Performance Management and Appraisal System?

Loyal employees tend to perform their job to the best and in return they expect rewards and recognition from the organization. This will boost their morale and enhance productivity.

As per Armstrong (2017) performance is an outcome of three main elements of facts and things, How things are done and motivating the people who have done it.

Continuous improvement of performance by individuals and teams by setting which are aligned to the overall objectives of the organization.

It involves Agreement between employer and employee and feedback about to where they heading.

The process involves with clear  simple goals which are measurable.They are simple and aligned to organizational goals. It's transparent and regularly assesed against themselves on given criteria.

As per the research done by Hamukwaya and Yazdanifard (2014) there are pros and cons of a performance appraisal system.

Advantages includes - Retention of qualified competent people, create willingness to take up challenges in job role, Motivates employees who are success in evaluation process, Improves efficient administration, Ability to achieve overall organizational objective.

Disadvantages of Performance appraisal system includes - Negelegence of unrewarded tasks, Demotivation of low rewarded employees, Lack of openness among the employees, The majority of the staff cannot be satisfied, Competition between employees instead of corporation., High cost involved for paper works and operating systems.

As per Farnham and Pimlot (1999) performance appraisal is used identify what are the  improvements can made in employee side and give them opportunity to improve their skills to perform more effectively in future. from the organization perspective they use appraisals to measure what level and type of work which the employees will capable of doing in future and they gives continuous training for the selected employees.

Employees are often dissatisfied with performance evaluation methods since it's mainly an activity between managers and employees. Managers also reluctant to engage in the process of it's confrontational nature.

As a whole the so called multinational companies have moved to explore new dimensions  to reward employees rathar than sticking into traditional employee appraisal methods such as annual reviews and mid year reviews. The main reasons are as described above the disadvantages of the appraisal process faced by organizations as a whole. 

As highlighted by Macmillan futuristic organizations are bringing new strategies an laying plans to address the negative side of the appraisal system expecting good results and enhanced performance.
They may use the tactics as

• Handling staff with respect
• Providing training to raters
• Rewarding managers for conducting performance appraisals.
• Choosing appropriate raters such as other organizations, peers, workers ,customers as in the case of 360 degree feedback.

References

Armstrong, M and Taylor, S.(2017) Armstrong's handbook on Human Resource Management Practice. London: Kogan page

Hamukwaya, S. and Yazdanifard, R ( 2014) How a proper Performance Related Reward System can contribute to work performance excellence, vol 2

Farnham, D. and Pimlott, J. (1999) Understanding Industrial Relations,4th Edition, Cassell Educational Ltd. London.

MacMillan, A. (2015) Importance of Performance Management process and Best practices to Optimize monitoring performance, Work reviews/Feedback and Goal management. https://www.successfactors.com/en_us/lp/articles

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