2. Explain the meaning of performance appraisal and describe its methods

Performance appraisal is a process for evaluating and documenting how well an employee is carrying out his or her job. It is part of a company’s performance management system.

Performance appraisals are based on the employee’s progress against goals set once a year with his or her manager. Usually, employees and managers will have check-ins throughout the year; at the end of the year the manager assigns an overall rating. The appraisal process gives employees feedback on their work, helps managers make decisions about pay increases and bonuses, and identifies areas that need improvement. Ongoing poor performance can lead to reprimands or termination.

 Performance appraisals are usually designed by human resources (HR) departments as a way for employees to develop in their careers. They provide individuals with feedback on their job performance. It ensures that employees are managing and meeting the goals expected of them, giving them guidance on how to reach them if they fall short. Because companies have a limited pool of funds from which to award incentives, such as raises and bonuses, performance appraisals help determine how to allocate those funds. They provide a way for companies to determine which employees have contributed the most to the company’s growth so companies can reward their top-performing employees accordingly. 

METHODS OF PERFORMANCE APPRAISALS

Numerous methods have been devised to measure the quantity and quality of performance appraisals. Each of the methods is effective for some purposes for some organizations only. None should be dismissed or accepted as appropriate except as they relate to the particular needs of the organization or an employee.

Broadly all methods of appraisals can be divided into two different categories.

Past Oriented Methods
Future Oriented Methods
Past Oriented Methods

1.    Rating Scales: Rating scales consists of several numerical scales representing job related performance criterions such as dependability, initiative, output, attendance, attitude etc. Each scales ranges from excellent to poor. The total numerical scores are computed and final conclusions are derived. ________ ______ ___ _______ ___ _____ ____ _______ ______.
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