In every industry, performance appraisal is very important to determine or evaluate every employee’s performance based on company’s standards and policies. The main objectives of performance appraisal is to improve employee’s productivity and performance, in order to set goals for the employees, to help the managers to evaluate employees’ effectiveness, before taking actions related to hiring, promotions, demotions, trainings, increase of salaries and terminations. Many companies have used performance appraisal as an effective tool in maximizing the effectiveness of all areas of the organization such as staffing, development, production and customer service. Generally, employee appraisal systems are being recognized as important factor of achieving company’s goals. For instance, a traditional appraisal method is discreet; the employees are not authorized to see or to know what the evaluation of their managers on them is. But, in 1900s, most companies have opened their options to allow their employees to benefit from the criticisms and praises made by the management. Aside from this, many companies decided to let their employees to participate in their appraisal systems. The employees are being asked also to evaluate their own job performance, self-analysis, and their views on how they can improve their participation in the organization, at the same time, getting feedbacks from their co-employees. Performance appraisals must result to further progress of each individual in the organization. It should focus on the process of establishing benchmarks, setting individual objectives, determining each performance, judging achievements based on goal settings and standards.
Moreover, past performance reviews are often developed and administered by management or human resources department. And, appraisal process must be associated with initiatives, trainings and mentoring. Additionally, during performance appraisals, personal needs and organizational issues are being resolved too. The role of performance appraisal also serves to improve the overall effectiveness of the entire organization. It administers, informs and motivates the entire people within the company. Appraisals administer because it plays as a facilitator of determining the salary increase and other rewards be given to deserving employees. In the same way, it also delegates authority and responsibility to the most capable employees. On the other hand, appraisals inform the entire people in the organization through informing the managers about employee’s strengths and weaknesses in the work place. Similarly, appraisals motivate the employees to improve their performance level; as well as to create learning experience among the workers.
Furthermore, all people in the company benefit form effective performance appraisals, since it helps every individual to discover what is being expected of them, and they are able to set goals for themselves. In the same time, they also gain better understanding on their strengths and weaknesses, that they can adjust their performance accordingly. It also creates constructive feedbacks to the workers about their performance. Eventually, they are being assisted to create plans to improve their behaviors, and may be able to get better ideas on how to contribute in achieving the goals of the company. In some point, appraisers can gain from evaluations as well. They can identify and measure the flow of activities of their employees. They can also get a better understanding of their workers’ needs and expectations from the company. Managers will be able to help their employees to set their long or short term career goals that will improve their skills and abilities as workers. Equally important, performance appraisals improve over-all communication systems of the organization; that will result to a more cooperative work force towards achieving productivity. More than that, effective decision making will arise if all the staff is motivated to support the management with its every decision. This process greatly promotes unification and smooth relationships between the management level and the workforce. In addition to that, it also eliminates bias and irrelevant evaluations and decisions towards increase of compensation and reward programs.
Correspondingly, performance appraisal must be pragmatic, relevant and uniform. Being pragmatic is very important in order to ensure that the appraisal system can be easily understood by the workforce, as well as it can easily be implemented by the managers. Remember, an appraisal system that is complex can only lead to confusion, disappointments and waste of time and money to the entire organization. And, it must be able to identify and evaluate the present condition of the organization as well as the employees. Performance appraisal system that does not able to deal with the critical behaviors of the employees is somewhat inaccurate, invalid and irrelevant. Lastly, uniformity of the appraisal structure is vital because it ensures that all employees will be evaluated on a standardized scale.