Performance Appraisal Methods



A performance appraisal in a business organization is a systematic and formal process of evaluating the job performance and contributions of an employee against predetermined criteria and objectives.

The primary purpose of a performance appraisal is to assess an employee's achievements, strengths, areas for improvement, and overall effectiveness in their role.  This process is often conducted periodically, such as annually or semi-annually, and involves feedback from both supervisors and employees.

Reasons for performance appraisal

  • Feedback and Improvement: Provide constructive feedback to employees for performance improvement.
  • Recognition and Reward: Acknowledge and reward high-performing employees.
  • Career Development: Identify areas for employee development and career growth.
  • Alignment with Organizational Goals: Ensure employee contributions align with organizational objectives.
  • Communication and Motivation: Foster communication and motivation within the organization.

 Performance Appraisal Methods

 Formative Appraisal:

The formative appraisal is an ongoing and continuous feedback process conducted during the performance period. It focuses on providing constructive feedback, identifying strengths and weaknesses, and guiding employees in improving their performance. Formative appraisal is more developmental and aims to support employee growth throughout the appraisal period.

 Summative Appraisal:

Summative appraisal occurs at the end of a performance period and involves a comprehensive evaluation of an employee's overall performance. The primary purpose is to make summary judgments about an employee's achievements, contributions, and areas for improvement. Summative appraisal often results in formal ratings or decisions regarding rewards, promotions, or further development.


 Self-appraisal is a process in which employees assess and evaluate their own performance, typically as part of the overall performance appraisal system. Employees reflect on their achievements, strengths, and areas for improvement. This self-assessment is then compared and discussed with the assessments provided by supervisors or managers. Self-appraisal encourages employee involvement and can enhance self-awareness.

 360-Degree Appraisal:

 360-degree appraisal involves collecting feedback from various sources, including supervisors, peers, subordinates, and sometimes external stakeholders. This comprehensive approach provides a holistic view of an employee's performance from multiple perspectives. The feedback collected from different sources aims to offer a more well-rounded and unbiased assessment, contributing to a broader understanding of an individual's strengths and areas for development.

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