Human resource management (HRM or HR) is the strategic approach to the effective management of

people in a company or organization such that they help their business gain a competitive advantage. It
is designed to maximize employee performance in service of an employer's strategic objectives.

Human Resource Development (HRD) is the framework for helping employees develop their personal
and organizational skills, knowledge, and abilities.

How to Administer an Effective Performance Appraisal System

by George N. Root III

An effective performance appraisal system is important to making proper personnel decisions.

A performance appraisal system helps a business to determine potential managerial candidates, adjust
the pay rate for each position based on performance and analyze employee performance to determine if
further training is needed or if dismissal is appropriate. It takes time to develop a performance appraisal
system that your company can use, but it is important as a human resources professional to learn how to
administer an effective employee evaluation process.

1. Announce when the performance appraisal process will begin at least 30 days in advance. Encourage
employees to make written notes of the questions they have for their managers and the points they
want their managers to consider about their performance throughout the year.

2. Distribute a self-evaluation to employees at the 30-day point. Tell employees that they need to
complete their self-evaluations and give them to their managers at least 14 days prior to their evaluation
meeting. Encourage employees to make a copy of their self-evaluation and bring it with them to their
manager meeting.

3. Require all managers to have their written evaluations, including the analysis of the employee self-
evaluation, completed seven days prior to the employee evaluation meeting.

4. Review each manager's completed employee evaluation to ensure that it does not violate any
company policies, or state and federal employment laws. If you find something inappropriate, schedule a
meeting with that manager prior to the employee evaluation to discuss the issue and make appropriate
changes.

5. Analyze the completed appraisal after the managers have their one-on-one meetings with their
employees and determine if the managers' recommendations are appropriate. If a manager has
suggested a pay raise, determine if the raise is within the company budget and if it would apply to the
employee based on the appraisal.

Tip
Stay involved in the performance appraisal process, and encourage employees to voice any concerns
they may have to you directly. You could also create an employee drop box so employees can write out
their concerns and submit them anonymously to you.