Performance Appraisal Systems
Performance appraisal systems are important and especially in the contemporary business environment which is very competitive. The level of competition is quite high and, therefore, organizations try to gain a competitive advantage by constantly improving the performance of their employees (Armstrong, 2010). Performance appraisal techniques help the organizations to identify areas of employees’ performances that need to be improved. The techniques, therefore, serve the following purposes;
They provide feedback that is used to improve future performances.
They identify areas that need further training.
They facilitate communication between employees and management through feedback.
They help in identify employee selection procedures depending on qualities needed.
They provide an opportunity for employees' growth and development (Gomez-Mejia, Balkin, & Cardy, 2001).
Several appraisal techniques can be applied to meet the above objectives and many other performance related goals. The following discussion explores some of these techniques that can be used at Matrix International Corporation.
360 Degrees Appraisal
It is a performance appraisal system used mainly to evaluate the performance of managerial employees. It is referred to as the 360 degrees appraisal technique since the evaluation of the employee comes from virtually all the stakeholders. The technique collects feedback from every stakeholder. They include, peers, supervisors, customers, senior managers, and suppliers. These are comprehensive feedbacks that are collected from people that interact with the manager and as such, the manager’s overall performance is evaluated using this technique. According to Bach and Edwards, (2013), the technique is more reliable since it collects feedback from all the stakeholders with whom the employee interacts. These include junior staff members who are allowed to chance to evaluate the performance of their senior. Other managers at the same level in rank are also allowed to provide feedback on their peers as does the customers who interact with the employee. The chances of a biased evaluation of the employee are significantly minimized since evaluation is done on a variety of fronts (Taylor & Taylor, 2010).
This technique evaluates the managers' skills, knowledge, and behavior. The evaluation of the employees' knowledge determines their understanding of their job, their company and the industry they operate in as a whole (Taylor & Taylor, 2010). Evaluation of skills determines the managers’ efficiency in carrying out their tasks and it also evaluates the quality as well as the effectiveness of the results they achieve to the company. Finally, evaluation of behavior determines the employees' interpersonal skills. For instance, it assesses the effectiveness of their communication skills, their attitudes about the various stakeholders, and their ability to manage time (Gomez-Mejia, Balkin, & Cardy, 2001). This technique is effective in appraising a manager’s performance in a dynamic work environment. The success of the technique largely relies on employees' acceptance of it, and that is achieved through emphasizing the benefits of the technique to the employees. They should have assurances of the system's fairness and accuracy.
Management by Objective (MBO)
This is a performance appraisal technique that involves the input of the employees in setting the goals that need to be achieved and laying down the strategy together with the supervisor on how to achieve the goal. It is, therefore, a performance evaluation technique that requires the management and the employees to work together. The employees are engaged in allocating the resources needed to accomplish the set objectives including timelines (Bach & Edwards, 2013). Employees then align their personal goals with that of the organization to play a part in achieving the set objectives (Armstrong, 2010). For instance, supposing a company intends to increase its sales volume by 30% in a period of one year, each sales employee will have a personal goal that will help in achieving the organizational goal. This appraisal technique evaluates the employees' ability to perform the tasks assigned and achieving the set goals. It also measures employees' behavior especially about their ability to work in teams.
Essay Method of Performance Appraisal
This appraisal method involves a rater who writes down a description of various aspects of an employee’s performance. The essay or description is based on several broad categories including the rater’s general impression of the employee’s performance, employee’s potential for promotion, capabilities and job qualifications (Bach & Edwards, 2013). The rater also states an employee's strengths and weaknesses about performing tasks and general behavior including team participation. The method also identifies the training needs of the employees. The advantages of this appraisal system are its ability to fill in information gaps that may be left out by other appraisal techniques. On the downside, however, the results of the appraisal exercise are dependent not only on the rater's writing skills but also on his or her judgment. Moreover, the contents of the appraisal essay may also depend on the memory power of the appraiser.
Similarities and Differences
The common characteristic between that above three appraisal techniques is their goal. They all intend to evaluate employees to identify their competence and weaknesses with an intention of identifying areas that can be improved. The 360 degrees appraisal and the MBO appraisal can both be considered to be fair and transparent since the parameters upon which the evaluation is done is known (Armstrong, 2010). The essay method relies more on the perception of the rater. Furthermore, according to Bach and Edwards, (2013), the 360-degree appraisal is more comprehensive and has the highest potential of being regarded as fair by the employees.
References
Armstrong, M. (2010). Armstrong's essential human resource management practice. London: Kogan Page.
Bach, S. & Edwards, M. (2013). Managing human resources. Hoboken, N.J.: Wiley.
Gomez-Mejia, L., Balkin, D., & Cardy, R. (2001). Managing human resources. Upper Saddle River, N.J.: Prentice Hall.
Taylor, S. & Taylor, S. (2010). Resourcing and talent management. London: Chartered Institute of Personnel and Development.
