Amity International Business School IMBA Semester I

Amity Global Business
Semester I
Performance Appraisal
Tanvir kaur
Performance appraisal, also known as employee appraisal, is a
method by which the job performance of an employee is
evaluated (generally in terms of quality, quantity, cost and
time). Performance appraisal is a part of
career development.
The aims of a performance appraisal are to:
 Give feedback on performance to employees.
 Identify employee training needs.
 Document criteria used to allocate organizational rewards.
 Form a basis for personnel decisions: salary increases,
promotions, disciplinary actions, etc.
 Provide the opportunity for organizational diagnosis and
 Facilitate communication between employee and
Methods of Performance
 Performance Appraisal is broadly classified into 2 categories:
1. TRADITIONAL METHODS: Are relatively older methods of
performance appraisal. These methods are based on studying the
personal qualities of the employees. These may include knowledge,
initiative, loyalty, leadership and judgment.
2. MODERN METHODS: Modern methods were devised to improve
upon the traditional methods. Modern methods attempted to remove the
shortcomings of the old methods such as subjectivity, bias etc.
1. Management by
objective (MBO)
2. Behaviourally
anchored rating scales.
Unstructured Appraisal
Employee Ranking
Forced Distribution
Graphic- rating scales
1. Unstructured Appraisal:
 The impression of the appraiser is written in an
unstructured manner.
 In some organisations, comments are grouped under
specific headings- quality of job performance, personality
traits, development needs.
 Used in small firms
2. Ranking Methods:
 Permits comparison of employees in groups regardless of the type
of job role and all are judged on the same factors.
 The employees are rated on the basis of their job performance
rather than personal traits.
 It does not indicate the degree of difference between the first and
the second man.
 Paired comparison is an improvement over simple ranking.
N(n-1) , the total no. of employees to be compared
 Cannot be done for periodic evaluation of the employees in an
3. Forced Distribution Method:
 Appraisal done on the basic factors such as excellent, average or
poor in which the evaluation o poor, average or excellent is not
explained very clearly.
 Forced Distribution Method is a forced method in which the
appraiser is required to evaluate the performance of the
employees on a scale of 5 i.e outstanding 10%, above average
20%, average 40%, below average 20% and poor 10%.
 This method eliminates biasness from the part of the supervisor.
 Feasible in large groups.
4. Graphic Rating scales:
 Scales are established for a no. of specific factors and qualities
based on 2 characteristics:
i. Characteristics, such as initiative and dependability
ii. Contributions, such as quality of work.
 In this method a space should be given after every column so that
the appraiser gives an example of his behaviour.
5. Check list:
 Consists of 2 techniques:
1. Weighted check list
2. Forced choice
A checklist is a set of objectives or descriptive statements about the
employee and his behavior.
Under weighted checklist, value of each question may be weighted.
Is the employee really interested in the task assigned?
Is he respected by his colleagues?
Yes / No
Yes / No
The rater is forced in the forced choice method to choose between
descriptive statements of seemingly equal worth.
This method removes biasness and offers great objectivity.