An appraisal is an act of assessing an individual, place or thing. In the workplace, it’s a way of evaluating employees to determine their value to your organisation. The outcome of this review provides the bases for promotions, pay increase and other benefits.
When done correctly, it should form part of an effective performance management system used to measure the progress of your staff.
This post explores how effective performance appraisals can increase employee performance. It also takes a look at how this increase improves their overall engagement.
What is an appraisal at work?
It’s a meeting between you and your employee to discuss their work performance. It also provides you with the opportunity to understand their abilities for further development.
Although these performance reviews aren’t a legal requirement, they’re a great way for you and your staff to have a dialogue about important work issues. They’re also an effective way to measure and manage your employees’ productivity and growth within the business.
Objectives of employee appraisals include:
- Defining employee’s roles and responsibilities.
- Identifying strengths and weaknesses.
- Determining compensation and pay packages.
- Providing performance feedback to a staff member.
- Receiving feedback from the employee.
- Improving communication.
The purpose of staff appraisals is to measure and improve the performance of your workforce. The desired result is to increase every employees’ potential and value to the company.
How to do a staff performance appraisal
While most employers recognise the importance, not all of them know how to conduct appraisals with an employee.
The first step to conducting an appraisal is planning.
You’ll need to access data relating to the employee’s performance, notes from their previous review meeting and information on future goals and objectives to set. Use this information to create an agenda that’ll help guide the direction of the meeting.
During the meeting, you’ll discuss their challenges and successes within that period. This part should include information on how an employee can improve their performance to reach targets.
However, the main focus of the staff appraisal process should be on the future development of the staff member.
It’s important to come up with an action plan for how they can meet their individual targets as well as contributing to the overall company goals.
Acas provides a variety of staff appraisals examples and templates you could adapt and use for your business.
These include employee appraisal forms for manual workers, forms based on job objectives and even self-evaluation forms for members of staff. They’ll use this to highlight their strengths and weaknesses as well as their skills and abilities.
Employee performance appraisal methods
There’re various methods with which organisations use to measure the performance of their employees.
They all have their own strengths and weakness. While one method may work well for an organisation, it may not for another. It’s important to determine the method that works for your business to evaluate your employee appraisal.
In their 1997 book Managing Human Resources, George Strauss and Leonard Sayles divide the methods into two categories
- Traditional methods.
- Modern methods.
The traditional method rates an individual’s personality traits such as loyalty, judgement, knowledge capacity, etc. Modern methods, however, develop on that. It focuses on the evaluation of job achievements.
Traditional performance appraisal methods include:
- Rating: This technique lists a number of factors which employers rate on a numerical scale according to their staff’s level of performance. For example, a scale of one to five with five meaning strongly agree and one meaning strongly disagrees.
- Forced choice method: Provided employees with ready-made statements about an employee that they can only answer ‘yes’ or ‘no’ to.
- Checklist method: A lot of employee traits in the form of statements with ‘yes’ or ‘no’ answers. Upon completion, it gets sent to the HR department for evaluation.
- Essay evaluation: Requires a detailed description of an employee’s performance. The description should include details of their relationship with co-workers, their strengths and weaknesses etc.
- Critical incidents method: This method requires the recording of the critical behaviours of each employee that makes a difference in the effective or non-effective performance. You may take these results into consideration when evaluating performance or considering promotions and bonuses.
- Confidential Method: These are more common in government departments where they evaluate employees based on various parameters including attendance, leadership, self-expression, ability to work with others, responsibility, integrity, etc.
Modern performance appraisal methods include:
- Management by objectives: This method involves working with employees to set goals and performance standards. The process requires comparing the goals achieved for the given period to the goals originally agreed upon. To take steps to improve employee performance it’s important to conduct reviews periodically.
- Assessment centre method: Used to measure the organisational and interpersonal skills and planning ability of employees. It helps to determine the training and developmental needs of your staff.
- Behaviourally Anchored Rating Scales (BARS): It’s a technique that uses qualitative and quantitative data to rate employees. The process compares their performance with a similar numerical rated behaviour.
Other modern performance review methods including the 360-degree method and human resource accounting.
As part of your membership with the MIA you can speak to a Croner expert for help with any of the above issues and get free in-depth, tailored advice. Email firstname.lastname@example.org or call 01403 800500 for the exclusive Business Support Helpline scheme number.