The Appraisal Process, Coursework Example

Introduction

Employee appraisals have an immediate impact on performance, career satisfaction, and motivation of workers. The below review is focusing on results of peer review research articles that examine the relationship between appraisal system accuracy, motivation, and job satisfaction. Appraisal process is commonly used in order to let the employee know about their performance and compare it with the company’s or supervisor’s expectations. (Boice & Kleiner, 1997).  It has several roles in the organization, namely: aligning personal career goals with the organization’s objectives, defining strengths and development areas of employees, and modify employee habits, approaches, or behaviors.  According to Obisi’s definition (2011. p. 92) describes the process as “a process involving deliberate stock taking of the success, which an individual or organization has achieved in performing assigned tasks or meeting set goals over a period of time a process involving deliberate stock taking of the success, which an individual or organization has achieved in performing assigned tasks or meeting set goals over a period of time”. The basic steps of the performance appraisal will be covered below, along with its challenges and main benefits.

How the Appraisal Process Should Work

The appraisal process should be a crucial part of performance planning. Managing performance is not a one-step action, but a continuous process. The successful appraisal process should include six basic steps, which are a part of the performance planning activity of the human resources department: planning and preparation, assessment, review, setting an appropriate place for the meeting, clearly delivering the appraisal sending out simple and easy to understand messages, and encouraging the employee to take action and following up process. Obisi (2011) states that a good appraisal would ensure that workers are fully aware of their role within the organization and their professional responsibilities. However, an appraisal should go further than that: Boice and Kleiner (1997) list some additional roles of the performance management and appraisal process, such as counseling, coaching, resolving conflict, setting standards for performance, providing feedback for employees, and linking performance goals to training plans and reward systems.

Distortions and their Sources

Wang et al. (2010) state that rating accuracy can be one of the major sources of distortions within appraisal systems. Poor data quality would result in inaccurate measurements. However, there are other reasons why appraisal can be ineffective, or would improvement. Personal preferences and bias also exist in organizations, and managers need extensive training in order to overcome these. Further, system designs might not be in line with the organization’s roles, and this would result in rewarding effectiveness in areas that are not serving the overall goal of the organization, while neglecting factors that are important. Wang et al. (2010, p. 549) also examined an interesting hypothesis regarding distortions: “Raters will inflate ratings of poorer performers and deflate ratings of better performers when they have a motivating goal”. The authors found that the individual raters influence the overall rating of the employee, while the person conducting the appraisal adapted a different approach towards high and low performers. As the authors (Wang et al. 2010, p. 558) put it: “rating errors could be attributed to the specific goals that raters are pursuing rating errors could be attributed to the specific goals that raters are pursuing”.

As it has been stated before, the main role of performance management and appraisals should be to communicate organizational objectives clearly and align them with the employee’s own goals. Therefore, the manager’s goals should have a lower significance in the process than the organization’s objectives. An appraisal should be designed to evaluate the performance based on various criteria, identify development areas, and improve performance by supporting employees, putting adequate training systems in place.

Lunenburg (2012) mentions that rating errors often originate from strictness or leniency, central tendency, the halo effect (personal preferences), and the recency of events (for example when recalling critical incidents).

Appraisals and Motivation

Saeed et al. (2013) states that there is a close relationship between appraisals, job performance, and motivation. The research conducted among a sample of 141 people within a Nigerian university, examining the impact of performance appraisals on motivation. The main findings of the study concluded that there is a moderate positive correlation between motivation of employees and their performance. The correlation between performance appraisal and motivation, however, was strong and positive. Further, based on the sample, the positive correlation between performance appraisal and future performance was identified.

Making Meetings Successful

Obisi (2011) describes six steps that help human resource managers and line managers successfully plan and conduct appraisals: establishing a performance standard, communicating these standards with employees, measuring the performance based on a rating system, comparing performance with the standards identified, discussing the results, and indicating corrective action. The above process followed would result in clear communication between employees and managers, however, this is not enough. The author does not mention what type of corrective action the manager should propose, and this is when the importance of development and training plans should be discussed. Several appraisal methods are described by the author, and those that involve employee feedback about the content or quality of appraisal are proven to be effective, as they allow the two parties to come to an agreement about the next steps and create a plan together. The appraisal methods that involve feedback from the employee, discussed by Obisi are  the 360 degree method, when colleagues have the opportunity to rate each other and their superior, and the problem solving method, which focuses on creating a consensus.

The Role of Employee Training and Development Plans

Daoanis (2012) states that good appraisals are able to increase employee commitments. This means that creating and individual training and development plan based on a consensus would be easier, and performance can be improved by targeting the identified development areas. Workers, according to the author (Daoanis, 2012) who feel like they are treated as a partner in turn become more motivated, and challenged. Further, the author concludes that “Employee training and development plays a major factor to enable both employee and managers identify and act on employee development needs”. That stated, performance appraisals should serve as a tool for identifying gaps in knowledge and developing training and development plans. Further, collaborative approaches towards training can also allow the manager to find out more about the individual employee’s goals, motivations, and aspirations, and align them with the organization’s objectives.

Conclusion

The above analysis of peer-reviewed articles has revealed that performance appraisals have a strong correlation with motivation, performance, and commitment. Managers need to focus on making performance assessments objective, supportive, and collaborative, in order to ensure that they maximize their benefits for the organization.

References

Boice, D. & Kleiner, B. (1997)  Designing effective performance appraisal systems. Work Study Volume 46 Number 6 1997 pp. 197–201

Daoanis, L. (2012) Performance appraisal system: Its implication to employee performance. International Journal Of Economics And Management Sciences. Vol. 2, No. 03, 2012, pp. 55-62

Lunenburg, F. (2012) Performance appraisal: Methods and rating errors. International Journal of Scholarly Academic Intellectual Diversity. Volume 14, Number 1, 2012

Obisi, C.  (2011) Employee performance appraisal and its implication for individual and organizational growth. Australian Journal of Business and Management Research Vol.1 No.9 [92-97] | December-2011

Saeed, R., Lodhi, R., Naeem, A., Rehman, A., Mahmood, R. & Ahmed, M. (2013) Impact of performance appraisals and motivation on employee’s outputs in banking sector of Pakistan. World Applied Sciences Journal 26 (3): 415-421, 2013

Wang, X., Wong, K. & Kwong, J. (2010) The roles of rater goals and ratee performance levels in the distortion of performance ratings. Journal of Applied Psychology 2010, Vol. 95, No. 3, 546–56