Performance Appraisal System In Human Resource Management

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Performance appraisal system is a systematic observation and evaluation of employees’ performance used in the organization to measure the effectiveness and efficiency of the employees. It plays a vital role in any organization human resource framework. Performance appraisal is needed because every employee has a different attitude to handle the work. As performance process provides a vehicle through which employees and their supervisors to collaborate, hence it enhances the work results and satisfaction. This process work best when both parties employees and supervisors work actively together to achieve the specific organizational goals.
Performance appraisal will improve the work performance, communication expectations, determining
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That is why it can be considered as the indicator of the quality of Strategic Human Resource Management in an organization.
Good and properly designed appraisal system, not only vital basis of successful employee performance, but it will aid the management by providing useful and valuable information for other strategic human resource functions. For instance, it helps in employee training and development decisions, compensation decisions and human resource planning.
Basically, there are two types of parameters are used in performance appraisal. Objective measures which are directly can be quantifiable. On the other hand, subjective measures which are not directly quantifiable.
Performance appraisal can be conducted annually or semi-annually between the manager and the employees. However there are new emergence of trends that are changing the style the appraisal. This is because those techniques used in the past are not relevant anymore and contain errors. For example, critical incident, narrative essay and ranking method. In all the way of work time, a number of new advance roads has been introduced and suggested such as assessment centres, BARS, and 720
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This concept was developed by Sir William Petty in 1691 but the research on true human resource accounting began in 1960 by Rensis Likert. Prof. Flamholtz. This techniques value people because employees is an valuable assets in an organization. Information on the value of human resource and investment upon them is useful for decision making in the organization. This method tries to find the relative worth of its asset in term of money. In this method, the performance appraisal of subordinates is determined in terms of contribution and cost incurred of the employees. For instance, the cost of training and induction and recruitment and selection. In consequence, the difference between the cost and the contribution of the employees have to be more than the cost incurred on them. The advantages of this method are it can ascertain the cost of labour turnover and it can develop the human resources. Whereas, the disadvantage is it seems to be unrealistic because the life of human resource is uncertain.
Assessment Centres. This method was first developed in 1943 in USA and UK. In this method, employees are rated over a length of time. It can be one or within three days. The manager will observe the employees’ behaviour in a series of selected work. The features of the assessment can be soft-skills, resistance to stress, creativity and mental alertness. The benefits of this method is, the concept is simple and flexible. It is also hard to obtain fake exercise.

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