Home Pros and Cons 12 Advantages and Disadvantages of Performance Appraisals

12 Advantages and Disadvantages of Performance Appraisals

Managers, as well as, employees often wonder why organizations do performance appraisals. Anyone who has been given or received performance appraisal could possibly say that it is a complete waste of time as it is ineffective. So what is performance appraisal exactly? Performance appraisal is the evaluation done on employees in regard to their job performances over a certain period of time. It is like a report card showing how one has been performing during the past year. So, is it necessary? Below are advantages and disadvantages of performance appraisal

Advantages Of Performance Appraisals

1. Improves Performance.
Performance appraisals major focus on improving employees performance as it analyses and evaluates the opportunity factors like social process and technology.

2. Employee Development.
Performance appraisal helps determine who is in need of more training as it gives information regarding the strengths and potentials as well as weaknesses of the employees.

3. Corrects Deficiencies.
Performance appraisal detects employee deficiency and suggests on corrective measures to be taken.

4. Career Growth.
Appraisal serves as a tool for the employees’ career planning and development as it assists in preparing each employee’s SWOT analysis.

5. Promotion.
Appraisals help the management determine which employee is to be promoted, transferred or rewarded.

6. Motivation.
Appraisals motivate employees to work harder.

Disadvantages of Performance Appraisal

1. Prone To Biasness.
Some raters may rate one depending on the general impression one gives. For instance, one might be rated high on all criteria even though he/she just performed well in a single area. The rater’s biases and prejudices also affect the process. These cases are seen when a one gets underrated because of sex, religion, favoritism, appearance, and race.

2. Contrast Error.
Performance appraisal is always based specific standards, however, when one gets rated without taking the standards into account a contrast error occurs. This also can occur if the rater looks at an employee’s current performance based on the past performance.

3. Generalization Tendency Error.
This occurs when a rater rates everyone within a narrow range because he/she thinks that the employees are all on the same level averagely.

4. Severity Or Leniency.
Appraisals demand that an evaluator should objectively draw a conclusion regarding an employee’s performance.

5. Sampling Error.
This occurs when a rater uses a small portion of an employee’s work to draw a conclusion.

6. Regency And Primary Errors.
Employee behavior at the start of the appraisal period and at the end can affect the process a time. For instance, a salesperson’s performance varies with season, at times it can be low and a time high.

Overall, appraisals are good only if the management operating them stick with their standards otherwise it will pointless.