Performance Appraisal: UGC NET Commerce Notes & Study Material

Performance appraisal is the periodic evaluation of an employee's work performance and overall contribution towards a business. Also termed as an annual review, employee appraisal, performance review, or assessment, a performance appraisal assesses an employee's skills, accomplishments, and development, or otherwise. The performance appraisal checks how effective one is doing their job. It assists managers in realizing what the employees show proficiency in and where they need to improve. The process also assists in providing rewards and promotions; if people need training, this will improve work for all. 

Performance appraisal is a vital topic to be studied for the commerce related exams such as the UGC NET Commerce Examination.

In this article, the readers will be able to know about the following:

• What is Performance Appraisal
• Types of Performance Appraisal
• How Performance Appraisal Works?
• Methods of Performance Appraisal
• Difference between Performance Management and Performance Appraisal

What is Performance Appraisal?

Performance appraisal is when a company checks how well an employee is doing their job. It is a process where they look at things like how well the person works, their accomplishments, and their skills. The company compares this to the goals and rules they set before. This helps the company know if the employee is doing a good job or if they need to improve. Performance appraisals help employees learn what they are doing well and what they can get better at. It’s a way to see if everyone is meeting the company’s goals. It’s also important for helping employees grow and succeed in their work.

Performance appraisal is an assessment of an employee's performance. Different kinds of appraisals are there, which not only help the managers to assess & comprehend an employee’s strengths and weaknesses.

Self-Appraisal

So self-appraisal means a person is in charge of their own work evaluation. They reflect on what they knew and what they had to learn. This enables them to own their work and plan for the future. It also offers managers insight into how employees perceive their performance.

Peer Review

As a general rule, peer review means getting feedback from fellow coworkers about each other's work. It gives employees the chance to learn from their teammates and improve their skills. This particular appraisal encourages collaboration and straightforwardness in communication. It also helps managers grasp how employees work as a team.

Manager Review 

Managerial evaluations refer to those in which the boss or manager assesses the work done by a subordinate. They assess whether or not the employee does his or her job on time and follows the right procedures. The manager gives feedback so that the employee has a chance for improving his or her work. This type of evaluation is crucial in determining the employee's promotions and rewards. 

360-Degree Feedback

360-degree feedback means reviews gained from various groups of people such as managers, coworkers, and even customers. This gives a more complete view of how well an employee is doing. This type of appraisal helps an employee to see her strengths and weaknesses from several different viewpoints. This is a fair assessment of performance. 

Rating Scale Appraisal

In rating scale appraisals, employees are rated according to various skills and behaviors. Managers can use either numbers or stars to show how good an employee is performing. This makes comparing employees' progress easy. It assists in the placement of promotions and rewards. 

Ranked Appraisal Method

When conducting an appraisal, employees are rated on a scale based on various skills and behaviors. Managers use numbers or stars to describe how well someone is doing. It allows you show the comparison between the progress of the employees. It assists in determining promotions and rewards.

Checklist Appraisal 

In checklist-type appraisals, managers use a list of statements to check whether or not an employee has met work standards. If an employee does well, the manager ticks “yes,” and if otherwise, they mark “no.” This method is quite straightforward and easy to understand. Also, the simple checklist allows managers to easily keep tabs on the performances of workers. 

Goal-Based Appraisal

Goal-based appraisal verifies whether or not an employee has met their work objectives. Employees and their managers agree on goals at the start of the year. They verify whether those objectives were attained at the end of the year. This process ensures employees remain on track and enhance their performance.

How Performance Appraisal Works?

Performance appraisal operates by monitoring how effectively an individual is performing a job. Initially, managers and employees establish goals to determine what should be done. The manager then monitors the work of the employee and gathers feedback from others. Subsequently, the employee and manager sit down and address the improvement, strengths, and areas that require improvement. The manager provides suggestions, rewards, or training to assist the employee to improve and perform better in the job.

There are various approaches to performance appraisal to monitor the performance of employees in their job. Some of them, such as ranking and rating scales, compare the employees with one another based on their work. Others, such as 360-degree feedback, gather opinions from managers, peers, and customers. In self-appraisal, employees appraise their own work. In management by objectives (MBO), objectives are established and then verified later. These approaches make employees better, reward them, and advance their careers.

Difference Between Performance Management and Performance Appraisal

Performance appraisal and performance management both assist individuals to perform their best at school or work. Performance management is a process that assists in guiding and enhancing an individual's work in the long run. Performance appraisal is an appraisal that occurs from time to time to check on how well one is performing. The only difference is that performance management is continuous, whereas performance appraisal occurs at intervals.

Feature	Performance Management	Performance Appraisal
Focus	Ongoing development and alignment with goals	Evaluation of past performance
Timeframe	Continuous process throughout the year	Periodic (e.g., annually, semi-annually)
Participants	Manager, employee, sometimes HR	Primarily manager and employee
Components	Goal setting, ongoing feedback, development planning	Goal review, performance evaluation, feedback discussion
Orientation	Improvement and development	Rating and judgement
Frequency	Regular check-ins, informal discussions	Formal review meeting
Emphasis	Future-oriented	Past-oriented
Example	Discussing roadblocks with an employee and providing coaching	Assigning a rating based on achievement of pre-set goals

A performance review is a method used to review if someone is doing their work right. It reminds individuals what they are doing properly and what areas they need improvement in. Traditionally, this is done through feedback from the boss or supervisor, but, at times, other individuals like colleagues can be of assistance too. This adds fairness and wholesomeness to the feedback. Once one has received feedback, they can devise goals to become even better. Listening to feedback is necessary because it teaches us and helps us grow. We all want to do the best we can, and a performance appraisal tells us how to do that. Ultimately, it's all about improving at what we do!

Performance appraisal is a vital topic per several competitive exams. It would help if you learned other similar topics with the Testbook App.