Assignment

Submitted By
MUHAMMAD RIAZ (B-01)
BAHAWAL KHAN MENGAL (B-07)
BBS (MORNING 2018-2020)

IMS DEPARTMENT

Submitted To
MK BHATTI,

INSTITUTE OF MANAGEMENT SCIENCES, UNIVERSITY OF

BALOCHISTAN, QUETTA,
BBS MORNING BATCH 2018-2020
 PERFORMANCE APPRAISAL PLAYS KEY ROLE IN DECISSION MAKING

Performance appraisal
Performance appraisal is a systematic process in which employees job performance is evaluated in
relation to the projects on which employee has worked and his contribution to the organization. It is
also known as an annual review or performance review.
Performance Appraisal is the systematic evaluation of the performance of employees and to
understand the abilities of a person for further growth and development. Performance appraisal is
generally done in systematic ways which are as follows:

It helps the managers place the right employees for the right jobs, depending on their skills. Often,
employees are often curious to know about their performance details and compare it with their fellow
colleagues and how they can improve upon it. So every company needs a good performance
appraisal system.

The supervisors measure the pay of employees and compare it with targets and plans.

The supervisor analyses the factors behind work performances of employees.

The employers are in position to guide the employees for a better performance.
Why performance appraisal is necessary in any organization

Performance appraisal is a method of evaluating the behavior of employees in the work spot,
normally including both quantitative and qualitative aspects of job performance. It is a
systematic and objective way of evaluating both work-related behavior and potential of
employees. It is a process that involves determining and communicating to an employee how the
job is done and ideally establishing a plant of improvement. The success of a company requires
that both boss and subordinate staff regularly evaluate their on-the-job performance. If they don’t
know how well they are doing, then the manager would have missed a key step in developing an
environment that will consistently produce cost-effective, high-quality, schedule-beating output.
A manager should also make sure that he/she conducts at least an annual performance appraisal
with each subordinate. The probability that one will earn consistent promotions, obtain salary
increases and lead a successful organization goes up every time you conduct a thorough
performance-boosting employee evaluation. Unfortunately, performance appraisals are all too
often not done or are conducted without specific references to extraordinary achievements or are
held in a setting where constructive results are unattainable. They are rushed and fail to set a
positive tone of supervisory interest and concern for subordinate needs. If an evaluation is held it
is because it is required by someone higher up the organization. As a result, all parties get it over
with as quickly as possible to relieve the pressure of being involved in an unpleasant event. Yet,
performance appraisals are necessary. Often a subordinate’s first performance appraisal may
occur at the end of a probationary period, anywhere from 30 to 90 days after their start date. It
may be informal or formal, documented or undocumented, scheduled or unscheduled. The point
is this review, as well as those to follow, have the potential to be the most meaningful
opportunities you will have to provide information subordinates can use to improve their
performance. Performance appraisal should be a positive experience and contribute to the overall
welfare of the organization. If done properly, performance appraisal is a very effective tool to
improve performance, productivity and for developing employees. It helps individuals to do
better, raises self-esteem and motivation. Above all it strengthens the management / subordinate
relationship and fosters commitment. Performance evaluation is not a process to be avoided;
rather it should be implemented in all organizations and promoted as a key management activity.
The benefits to be realized from a proper evaluation system far outweigh the time and effort
required to develop, implement and maintain the process. There is much research to show that
individuals have a strong need to know how they are doing and where they stand in the eyes if
their managers. Recognizing the importance of performance feedback, it follows that discussions
of performance should take place more than once a year. Frequent, regular discussions of
performance should occur on an on-going basis and be seen as an opportunity for useful
communication between the individual who assigns work and those performing it.These regular
meetings serve to provide feedback so good performance is recognized and performance
problems are nipped in the bud.The more formal periodic reviews the better, since there will be a
summary of what has occurred throughout the reporting period recorded on the official
performance evaluation form. Performance appraisal should be viewed as a beneficial process
within the context of an effective system of personnel management. It should be accepted as a
normal management responsibility to review the performance of all employees and for all
managers to discuss performance with their subordinates on a regular basis for the better of the
organization.

Training and Development

Performance appraisal offers an excellent opportunity - perhaps the best that will ever occur - for a

supervisor and subordinate to recognize and agree upon individual training and development needs.

During the discussion of an employee's work performance, the presence or absence of work skills can

become very obvious - even to those who habitually reject the idea of training for them!

Performance appraisal can make the need for training more pressing and relevant by linking it clearly to

performance outcomes and future career aspirations.

From the point of view of the organization as a whole, consolidated appraisal data can form a picture of

the overall demand for training. This data may be analysed by variables such as sex, department, etc. In

this respect, performance appraisal can provide a regular and efficient training needs audit for the entire

organization.

Recruitment and Induction

Appraisal data can be used to monitor the success of the organization's recruitment and induction

practices. For example, how well are the employees performing who were hired in the past two years?

Appraisal data can also be used to monitor the effectiveness of changes in recruitment strategies. By

following the yearly data related to new hires (and given sufficient numbers on which to base the analysis)

it is possible to assess whether the general quality of the workforce is improving, staying steady, or

declining.

Employee Evaluation
Though often understated or even denied, evaluation is a legitimate and major objective of performance

appraisal.

But the need to evaluate (i.e., to judge) is also an ongoing source of tension, since evaluative and

developmental priorities appear to frequently clash. Yet at its most basic level, performance appraisal is

the process of examining and evaluating the performance of an individual.

Though organizations have a clear right - some would say a duty - to conduct such evaluations of

performance, many still recoil from the idea. To them, the explicit process of judgement can be

dehumanizing and demoralizing and a source of anxiety and distress to employees.

It is been said by some that appraisal cannot serve the needs of evaluation and development at the same

time; it must be one or the other. But there may be an acceptable middle ground, where the need to

evaluate employees objectively, and the need to encourage and develop them, can be balanced.

Importance and Benefits of Performance Appraisal

Process:
The following mentioned are few tips on advantages of performance evaluation process.

Promotion- a fundamental subject for employees:

Job performance evaluation helps the managers to check out the promotion programs for
experienced employees. In this view, heavy-handed member of team can be sacked or demoted
in whichever case. This purpose of performance appraisal system of promotion is actually that it
helps employers to see which employee would be more beneficial for them in either business or
growth terms of the company. Promotion of an employee not only encourages employees to
perform much better but also gives employer or boss to enhance the workload and assign that
work in order to get fruitful results from that person.

Pulling out of positive act for an increase in salary:

Job performance review facilitates in chalking away recompense parcels for the employees.
Good point rating can be done through performance appraisal methods only. Performance
appraisal endeavors to offer merit to an employee’s performance and an increase in salary. A
compensation package during performance appraisal includes bonus, high earnings rates, extra
reimbursement, various allowances and requisites. The criterion should be based on good
points more willingly than pre-eminence.

Enhancement in employee’s progress:

This logical performance appraisal process helps the managers and HR people to outline
preparing policies and programs in a better way in order to foresee and put into practice any
progress expansion for employees as well as for employer.It helps to pore over effectiveness and
flaws of employees so that new everyday jobs can be well planned and assigned to capable
employees. Such appraisals at work also help in casing future expansion line ups. The progress
of every employee has to be equally viewed in order to enhance a chance for progression in their
career.

Assortment validation of employee’s stability:

Such work appraisal systems help the managers to comprehend the validity and significance of
the actual staff evaluation course of action. Bosses come to know about the employee’s strengths
and in this way, they also come to know about the potency and weak point in this staff appraisal
procedure. Any changes could be modified in such methods in this regard. It reflects to keep up
the effectual stability part of the employees as well. When an employee gets very good
appreciation and job appraisal after working for the year, the chance of their stability
involuntarily increases and it decreases the attrition rate in the company.
Discussion of own concerns:

For every business or organization, effectual communiqué among employees and employers is
really significant. Eventually through process of performance appraisal, declaration could be
singled out in many ways. From beginning to end of performance appraisal, an employer can
appreciate and recognize skills of their staff and discuss them thoroughly during appraisal
performance period. The subordinates can also comprehend and build a trust and confidence in
superiors. It also facilitates in maintaining amiable and sociable work managing association
among both. It develops the strength of mind for work and boost up the self-confidence of
employees.

A tool of motivation:

Performance appraisal also serves as an inspiration tool. All the way through weighing up
performance of staff, an employee’s efficiency can be strong-minded if the goals are achieved
well in time. This motivates the employee for performing better in job and helps him to perk up
their presentation for the future as well. Performance appraisals increase their strength level and
motivate them to the utmost and they can carry out even much improved performance in future.
Bosses must heighten and/ or motivate their juniors so that it could boost up employee’s strength
level and they can perform wisely and productively.