When doing anything meaningful, humans have a natural desire to know how they are performing. In particular, if they are doing a job, they need to know if they are doing horrible, great, or somewhere in between. One of the best potential ways of providing this feedback is through the use of performance appraisals. By definition, “performance appraisal is the process through which employee performance is assessed, feedback is provided to the employee, and corrective action plans are designed. (Youssef, 2012)
If properly designed and administered, a performance appraisal can provide a great benefit to the employee, supervisor, and the company itself; however, one must be careful when giving appraisals. Bias, whether intentional or unintentional, can be detrimental at all levels. Though it may seem simple, there are a variety of implications with the entire appraisal systems. There are strategic advantages of performance appraisals, forms of bias within these appraisals, and effects on the achievement of strategic objectives from appraisals.
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Performance appraisals can provide strategic advantages at a multitude of levels. “PM [Performance Management] identifies organizational goals, results needed to achieve those goals, measures of effectiveness or efficiency (outcomes) toward the goals, and means (drivers) to achieve the goals. This chain of measurements is examined to ensure alignment with overall results of the organization. ” (McNamara, N. D. ) In order to properly administer a performance appraisal, there must be a comparison between performance and organizational goals.
This allows the employee the opportunity to completely understand what the company is expecting from that employee. By understanding goals, an employee can focus on ensuring those goals are met. From the viewpoint of supervision, performance appraisals forces a supervisor to think about what contributions an employee has provided to an organization. Depending on the style of appraisal used, a supervisor may be required to list specific examples of what the employee has done. In those reviews, the supervisor must focus on exact accomplishments rather than simply generalized statements.
By doing this, the supervisor can precisely identify how the employee has been doing with respect to the required goals, as well as specific strengths and weaknesses. Depending on exact situations, this could also be used as a disciplinary action tool if the employee does not comply with the requirements of the position. Without this tool, it is difficult to gauge an employee’s performance because there is no data to show positive or negative actions. One must be careful when administering performance appraisals. Many times, bias can prevent an appraisal from being a true representation of an employee’s performance.
Though some biases are not intentional, they can still be harmful in the same manner as those that are intentional. Some examples of biases noted in performance appraisals are recency bias (focusing more on recent behaviors), leniency and strictness bias (being too soft or too tough, regardless of performance), halo effect bias (rating a person’s overall performance on one or two traits), central tendency bias (rating everyone not too good but not too bad), compare/contrast bias (basing someone’s performance on another employee’s performance), and length of employment bias (basing a rating on a person’s time with a company).
Through the variety of above listed biases, it is very simple to give an employee a falsified rating. This can lead to inaccurate results that are not in line with the company’s strategic goals. Also, because employees tend to share information, it can lead to discontent among workers if an employee is given a rating that doesn’t truly match their performance. “Remember that it’s natural for managers to have different personal feelings about each employee—and have preconceived notions about their performance.
But your goal is to separate those personal views about employees from their actual performance, and to offer the most objective and consistent feedback possible. ” (Business Management Daily, 2012) Proper performance reviews can do more than just identify the strengths and weaknesses of an employee and the realization of goals. They can also lead to the accomplishment of the desired goals. If an employee is faltering in a particular area, performance reviews can identify that area.
By identifying that area and by understanding that they are being graded in that area, employees can work towards correcting their shortcomings. However, if they don’t know that there is a problem in a particular area, they can’t fix it. The link between identifying employee’s weaknesses and correcting those weaknesses can often be as simple as communicating the perception that there is a problem that needs addressing.
By informing the employees of their performance grades and by letting them know that they will be graded again, they tend to work towards aligning themselves with the organization’s goals. By looking at the strategic advantages, forms of bias, and achievement opportunities of performance appraisals, it is plain to see why they can be so important. If the appraisal is not properly completed, there can be major disconnects between the employee and the company’s goals.
This can lead to job performance that does not benefit the organization as well as undeserved feelings of poor job performance. However, if the appraisal is properly performed, it can be a very valuable tool that benefits all levels of the organization by promoting strengths in employees as well as identifying and working to correct weaknesses. This can lead to a better employee and a more efficient organization. When properly used, performance appraisals can easily be one of the most valuable tools in any organization’s arsenal.