This document provides an overview of performance appraisal in the workplace. It discusses the objectives of performance appraisal, which include evaluating training programs, forecasting future training needs, motivating employees, justifying wage differences, rewarding high performers, and determining promotions and transfers. The document also outlines the common methods used in performance appraisals, such as ranking, graphic rating scales, forced distribution, critical incident reporting, management by objectives, essays, and comparing performance to work standards. Finally, it lists some common sources of appraisal like self-appraisal, supervisors, peers, subordinates, and customers.

1. Performance Appraisal
Course: BBA
Subject: Principles of Management
Unit: IV

2. Performance appraisal
• It’s a systematic appraisal of the employee’s
personality traits and performance on the job
and is designed to determine his contribution
and relative worth of the firm
• All formal procedures used in working org. to
evaluate personalities and contributions and
potentials of group members

3. Objectives of P.A.
• To evaluate the success of training programmes
• To forecast need of training
• To motivate empl for better work
• Justification of wages to diff. empl acc to their
abilities
• To reward efficient empl
• To determine policy for promotions and transfer

4. Process of P.A.
1

5. The appraisers
1. Self appraisal:
- Identifying strengths and weakness, problem
areas
2. Supervisors :
3. Peers: co-workers evaluate
4. Customers/clients: in service organizations
i.e., banks, hotels
5. Subordinate:

6. Methods of P.A.
1. Ranking method:
- Ranks are given to empl
- All workers are judged on same factors
- Best is placed first , poorest ranks last

7. 2.Graphic rating scale:
- Rated on personality characteristics and
performance
- Ex. For worker- job knowledge, intelligence,
dependability, quality of work etc
- For manager- leadership qualities, creative
abilities, organizing ability, communication skill
- Assessment is based on excellent, average; above
average; outstanding; or unsatisfactory, poor

8. 1

9. 3. Forced distribution method:
• manager who is told that he or she must rate
subordinates according to the following
distribution:
-10 % low; 20 % below average; 40 % average;
20 % above average; and 10 percent high.
- In a group of 20 employees, two would have to
be placed in the low category, four in the below-
average category, eight in the average, four
above average, and two would be placed in the
highest category.

10. 4.Critical incident method:
- It requires the supervisor to keep a log on
employees performance
- Recorded in a special book
- Note of all critical incidents

11. 5. MBO (Management By Obj.) (Appraisal by
results)
- Joint goal setting between the manager and
subordinate
1. Set the organization’s goals. Establish
organization-wide plan for next year and set
goals.
2. Set departmental goals.
3. Discuss and allocate department goals.
4. Define expected results (set individual goals).
5. Performance review and measure the results.
Department heads compare actual performance
for each employee with expected results.
6. Provide feedback.

12. 6. Essay appraisal method:
- Appraiser prepares a document describing the
performance of employee
7. Work standard approach:
- More suitable in manufacturing units
- Goals are pre-determined work standards
8. Point allocation method:
- Appraiser allocate points to diff. members in his
team
- Best performer gets higher score and vic-e-versa

13. References
1.https://lh5.ggpht.com/mvO5_gL3H14iQgy_D6o0Dd-
LxDBDRtGw1ieaH2de5Gt-KEix-yuK13jgsNHfx77JMhJpqL0=s85
2.https://lh5.ggpht.com/pAD2KznYVu1Xs8xd6QYFlRbkpxlRI0Bjbb
vEg76_LnZ9izdZzVXFlbRj5ZDwTzq3RpJgquI=s85