The uses of Performance Appraisal.
Organizations usually conduct appraisals for administrative and/or developmental purposes 3 Performance appraisals are used administratively whenever they are the basis for a decision about the employee's work conditions, including promotions, termination, and rewards. Developmental uses of appraisal, which are geared toward improving employe performance and strengthening their job skills, include counseling employees on effecti work behaviors and sending them for training Appraisals are typically done once a year, and are often based on supervisors' subie tive judgments rather than on objective indicators of performance, such as number of units produced. This has led many to conclude that appraisals are full of errors. For exam ple, annual appraisals can place an excessive burden on the memory of a person who has to rate multiple workers. Also, supervisors' judgments may be influenced by stereotypes and other personal beliefs or perceptions.s For these and other reasons, dissatisfaction with appraisal is rampant. One survey found that the majority of HR professionals are dissatisfied with their current appraisal system. Some companies have even decided to do away with traditional appraisal systems altogether. For instance, some Cigna divisions have dropped numerical ratings and written appraisals in favor of more verbal communications. Nonetheless, written appraisal remains an important activity in most organizations The challenge is to manage the appraisal system so that it furthers the goals of perform ance improvement and worker development. In the next two sections, we explain the issues and challenges involved in the first two steps of performance appraisal, identification and measurement. We conclude the chapter by discussing how managers can use the results o appraisal to improve employee performance.