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Chapter 1 - The Performance Appraisal Process—An Overview

Performance Appraisals: Strategies for Success

by Diane Arthur
AMACO M © 2008 Citation

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Benefits and Uses of Performance Appraisals

Earlier, you read that the most effective performance appraisal programs are those that are viewed as
beneficial to employees, appraisers, and the entire organization. Let’s explore this more fully while
examining benefits and uses of appraisals for these three groups. (See Exhibit 1–2.)

Exhibit 1–2: Benefits and Uses of Performance Appraisals For Employees

Think About It...

Is there an efficient way to balance the timing of conducting performance appraisals with recommending
salary increases that is satisfactory to both employers and employees? _______ yes _______ no. Explain
your answer.

Benefits and Uses for Employees

T here are four key ways in which employees can benefit from and use performance appraisals that have
nothing to do with money.

1. Employees receive a clearer understanding of what they are expected to do. During the

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performance review process, employees can expect their appraisers to reiterate job expectations,
clarify areas of responsibility, and identify any ways in which the scope of the job may have
changed. T his refresher ensures that both the manager and the employee view the job in the
same context.

For example, for the position of an assistant director of human resources, the appraiser might
make the following introductory remarks: “Your primary duties entail recruiting, interviewing, and
screening applicants for nonexempt level positions, assisting department heads with hiring
decisions, and performing reference checks on potential employees. In addition, over the past
several months you’ve been asked to assist the EEO officer with advising managers on matters of
equal employment opportunity and affirmative action as they pertain to the interviewing and
hiring process. Is this consistent with your understanding of your primary areas of responsibility?”

T he employee may respond by saying, “Yes, except for the last part. I didn’t realize I was going
to take on EEO as one of my regular duties; I thought that was just temporary while the EEO
representative was out on leave. I don’t really think I have enough training to do this on a regular
basis.” T he employee’s last statement serves as an excellent segue into the next appraisal
benefit for employees.

2. Employees learn how well they are meeting expectations and the need for training and
development. Once both parties agree on the employer’s primary expectations and the
employee’s areas of responsibility, they can move on to addressing how well the employee has
been performing since the time of his or her last review. In the previous example, the appraiser
might say, “Overall, you’re doing an outstanding job with your recruiting and interviewing tasks.
In addition, the department heads have nothing but praise for your selection recommendations.
With regard to the EEO tasks, I didn’t realize you were under the impression it was temporary: the
person who was doing that job isn’t coming back. Is this something you see yourself doing on a
regular basis?” T he employee might then expand upon what she said earlier: “I enjoy the work,
but I need a better handle on what I’m doing.”

At this point, it would be appropriate for the appraiser and the employee to explore training
opportunities together.

3. Employees are able to openly express opinions and concerns. Hopefully, employees feel
comfortable enough with their managers to consistently express their views. T he formal appraisal
process, however, affords an atmosphere whereby employees should be encouraged to truly
open up and voice their opinions and concerns about anything work-related.

In the previous scenario, the assistant to the director of human resources might comment, “I have
to say I feel a little taken advantage of. Obviously you knew the EEO representative wasn’t
coming back, but you didn’t tell me.” T he appraiser should resist taking this statement personally
and engage in a meaningful two-way dialogue with the employee; that way it can lead to the
next employee benefit.

4. Employees can pursue the achievement of future goals. Employees can benefit greatly from the
appraisal process when they are given the opportunity to express their aspirations and pursue
growth opportunities. Managers should encourage employees to discuss future goals, even if
they are unrelated to their current job. Together, they should map out steps that will ultimately
result in the achievement of these goals. T hese steps may include taking outside courses,
shadowing another employee, or working on additional assignments. Setting up dates to discuss
progress toward accomplishing these goals will encourage the employee to be more productive.

Think About It...

If your organization has a formal appraisal program do employees . . .

1. Receive a clear understanding of what they are expected to do? _______ yes _______ no

2. Learn how well they are meeting expectations and the need for training and development?

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_____ yes _____ no

3. Openly express opinions and concerns? _______ yes _______ no

4. Pursue the achievement of future goals? _______ yes _______ no

If your organization does not have a formal appraisal program, or if you answered “no” to any of the
previous questions, how do employees . . .

1. 1.Receive a clearer understanding of what they are expected to do?

2. Learn how well they are meeting expectations and the need for training and development?

3. Express opinions and concerns?

4. Pursue the achievement of future goals?

Benefits and Uses for Managers

T here are four key ways in which managers can benefit from and use performance appraisal programs.

1. Managers will be able to utilize their staff more productively. Performance appraisals compel
managers to become more aware of each employee’s strengths and areas requiring
improvement. As a result, they can more effectively determine the best utilization of each
person’s skills, knowledge, and interests. In turn, this will contribute to a more efficient and
productive workflow in the department.

2. Managers can isolate unusual performance. Outstanding performers require additional

incentives and more challenging assignments to remain on the job. In contrast, poor performers
need more guidance and direction, as well as being prevented from interfering with or disrupting
the work of others. Performance appraisals help managers identify outstanding and poorly
performing employees, as well as isolate specific areas requiring attention. When employees are
properly directed, managers are able to focus on developing their own career goals.

3. Managers can enhance their employer-employee relations as well as focus on honing their
managerial abilities. When conducting performance appraisals, managers need to ask
themselves what role their attitude and behavior plays in a particular employee’s work
performance. For example, if an employee is performing poorly, the appraising manager needs
to ask: Was I available for questions? Did I make clear my expectations? Did he or she
understand the work assignment? Did I provide realistic deadlines? Was I clear in explaining
available resources? Honest answers to questions like these can result in revised approaches to
interacting with staff, thereby improving overall employer-employee relations.

4. Managers can clarify areas of responsibility and work distribution. Imagine this scenario: you are
a manager in your department, with three employees reporting to you. Each employee shares
the same title and was hired to perform the same essential functions of their job. From the
outset, it becomes apparent that Employee A is more inclined to take on extra assignments and
stay late as needed. It is not that Employees B and C are unwilling to do their share: they just do
not mind if Employee A “steps up to the plate” and takes over. Soon, Employee A, eager to
please you and anxious to earn a promotion, is doing more than his share; Employees B and C
are fine with this and do less and less work.

Think About It...

What happens in your organization when one employee’s output surpasses that of a colleague who is
hired to perform the same tasks?

T he performance appraisal process can help you address this inequity. You may determine that Employee A’s
title and scope of responsibilities need to change, with an accompanying increase in pay. Or you may decide
that Employees B and C need to be held more accountable with Employee A stepping back somewhat.

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Formally evaluating their respective performance levels will help you determine the best course of action.

Benefits and Uses for the Organization

One of the greatest performance appraisal benefits to an organization has to do with the issue of consistency.
Consider, for example, that discrimination complaints often allege that employees with similar performance
levels were granted disparate rewards or subjected to different forms of discipline. An effective appraisal
system increases the potential for consistency by ensuring that all similarly classified employees are
evaluated based on the same criteria. When performance appraisal programs help ensure consistency, some
charges of discrimination can be averted.

Organizations also can benefit from and use performance appraisals in communicating their strategic vision
with employees. As stated earlier, employee goals should to be as closely aligned as possible with those of
the organization. When properly executed, an appraisal system can become a powerful tool for ensuring that
employees understand and act on the organization’s short- and long-term strategic goals.

Additional benefits and uses of performance appraisals to the organization include:

Gleaning valuable information for human resources development and long-term planning

Furnishing data to help establish equitable salary administration programs

Identifying future training and development needs

Identifying employees who may have been “mismatched” with their jobs

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