Most managers today dislike the performance appraisal process and view it as an annual, traditional, time-consuming, burdensome, counterproductive, and a painful practice where they only spend a small amount of time at the end of the year collecting employee information and filling out appraisal forms. Reasons include the inconsistency in using performance appraisals within the organization, the ambiguity in distinguishing among the different levels of performance, and the poor linkage between the appraisal system and the need to develop better skills and competencies for employees. Yet what these managers don’t know is that performance appraisal when properly conducted is considered invaluable to the organization since it builds up employee objectives, links them to the corporate and strategic goals, identifies employee strengths and weaknesses, and legally explains to an employee how HR decisions were taken. For more information on how to strengthen the performance appraisal process and strategically link it with employee training and development, check out my article Linking Performance Appraisal to Training And Development: Case Study Example.
The purpose and usage of a performance appraisal have considerably expanded over the last years. Before 1960, a performance appraisal was used solely for administrative reasons (salary, promotion, and placement type decisions) (David and James 1993). Later, the view of a performance appraisal as a counseling/development tool and the provision and design of several conceptual frameworks for understanding this new vital role have dramatically proliferated. The purpose of this essay is to demonstrate the importance of this new role by first describing the performance appraisal system of Organization “A”, its training and development planning system, and the intended links between these two systems. The essay then critically analyzes these links and provides suggestions on strengthening them based on the nature of Organization “A” culture and environment for the sake of improving the developmental functionalities of Organization “A” performance appraisal system.