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Pros and cons of performance appraisal

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I. Contents of getting pros and cons of performance appraisal

The performance review is usually a standard part of an employee's working year. The review is
a time when an employee can sit down with his manager and discuss how his performance has
been throughout the previous year. Although this review process seems to be a part of almost
every company, it does not mean that the process is without its detractors. There are several pros
and cons regarding employee reviews that you need to look at before your company decides on
an evaluation process.
Regular Updates
The performance review gives an employee a regular update on how her progress within the
company is coming along. By doing the review yearly, an employee can see what her managers
believe her accomplishments were and what she has to work on for the year ahead. A year gives
a manager a good amount of time to accurately make determinations about performance and set
long term goals for workers.
The review process can be a good way for an employee to get extra training. By its nature, a
review will encompass the job as a whole, instead of what the employee is working on that
second. When this occurs, managers and employees can get to the bottom of the reasons behind
the employees overall performance. If the employee is doing well and wants to enter new
working areas, a manager can recognize that and get that employee to the correct people. If the
employee is failing, the manager can determine why and get the employee into training.

The biggest problem with performance reviews is the fact that they are done by people. Because
of this, bias and unevenness in the review process can creep in. For example, a new manager
may come into the company who does not get along with one of the employees. As much as the
manager tries not to, she may judge an employee she doesn't like harsher than one she does. This
bias can lead to questions regarding the entire review process if it is too noticeable.
Any review that takes place only once a year can leave an employee feeling blindsided,
especially if he finds that his manager believes there is room for improvment. Managers who are
untrained in the art of the performance review may not take time throughout the year to
communicate with the employee, especially if the employee is doing an adequate job. When
review time comes, this adequate employee may feel surprised that there are issues with his

III. Performance appraisal methods

1. Essay Method
In this method the rater writes down the employee
description in detail within a number of broad categories
like, overall impression of performance, promoteability
of employee, existing capabilities and qualifications of
performing jobs, strengths and weaknesses and training
needs of the employee. Advantage It is extremely
useful in filing information gaps about the employees
that often occur in a better-structured checklist.
Disadvantages It its highly dependent upon the writing
skills of rater and most of them are not good writers.
They may get confused success depends on the memory
power of raters.

2. Behaviorally Anchored Rating Scales

statements of effective and ineffective behaviors

determine the points. They are said to be
behaviorally anchored. The rater is supposed to
say, which behavior describes the employee
performance. Advantages helps overcome rating
errors. Disadvantages Suffers from distortions
inherent in most rating techniques.

3. Rating Scale
Rating scales consists of several numerical scales
representing job related performance criterions such as
dependability, initiative, output, attendance, attitude etc.
Each scales ranges from excellent to poor. The total
numerical scores are computed and final conclusions are
derived. Advantages Adaptability, easy to use, low cost,
every type of job can be evaluated, large number of
employees covered, no formal training required.
Disadvantages Raters biases

4. Checklist method
Under this method, checklist of statements of traits of
employee in the form of Yes or No based questions is
prepared. Here the rater only does the reporting or
checking and HR department does the actual evaluation.
Advantages economy, ease of administration, limited
training required, standardization. Disadvantages Raters
biases, use of improper weighs by HR, does not allow
rater to give relative ratings

5.Ranking Method
The ranking system requires the rater to rank his
subordinates on overall performance. This consists in
simply putting a man in a rank order. Under this method,
the ranking of an employee in a work group is done
against that of another employee. The relative position of
each employee is tested in terms of his numerical rank. It
may also be done by ranking a person on his job
performance against another member of the competitive
Advantages of Ranking Method
Employees are ranked according to their
performance levels.
It is easier to rank the best and the worst
Limitations of Ranking Method
The whole man is compared with another
whole man in this method. In practice, it is very difficult
to compare individuals possessing various individual
This method speaks only of the position where an
employee stands in his group. It does not test anything
about how much better or how much worse an employee
is when compared to another employee.
When a large number of employees are working,
ranking of individuals become a difficult issue.
There is no systematic procedure for ranking
individuals in the organization. The ranking system does
not eliminate the possibility of snap judgements.

6. Critical Incidents Method

The approach is focused on certain critical behaviors of

employee that makes all the difference in the
performance. Supervisors as and when they occur record
such incidents. Advantages Evaluations are based on
actual job behaviors, ratings are supported by
descriptions, feedback is easy, reduces recency biases,
chances of subordinate improvement are high.
Disadvantages Negative incidents can be prioritized,
forgetting incidents, overly close supervision; feedback
may be too much and may appear to be punishment.

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