Studies on the dimensions or criteria used, and the

Studies have shown that performance appraisal is a
discrete, formal, organizationally sanctioned event, usually not occurring more
frequently than once or twice a year. Also, it can be viewed as an evaluation
process, which quantitative scores are often assigned based on the judged level
of the employee’s job performance on the dimensions or criteria used, and the
scores are shared with the employee being evaluated. Measurement issues are
important for the performance appraisal process, as are issues of rater
motivation, so that effective appraisal systems are those where the raters can
measure employee performance and the motivation to assign the most accurate
ratings.  Performance Appraisal is defined as an assessment of employees by the
manager, in which he/she evaluates the overall contribution made by the
employee to the organization. It is a systematic and logical review,
conducted by the organization annually to judge his/her potential in performing
a task. It helps to analyze the skills and abilities of an employee for
their future growth that increases the productivity of employees. It helps to
identify, the employee who performs their task well and those who are not,
along with the reasons for the same.

Most organizations today have placed great emphasis on
ways of eliciting improved performance outcome from its employees which has led
to many research on organizational productivity and performance appraisal
mechanisms. As pointed out by Armstrong (2005), most studies on improving
organizational productivity have over the years focused on ways of increasing
organizational productivity through performance management, thus, performance
appraisal is a human resources activity that has existed for several decades,
ranging from annual overview and appraisal of management performance, as well
as individual employee performance, the practice has always taken the dimension
of appraising performances by either the organizations management or a
restricted supervisory group without a specific strategic approach. The main objective of the performance appraisal system is to exercise
control over the activities of the employees through disciplinary actions of
rewards and promotions.

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The supervisors/managers are expected
to rate their employees on certain traits ranging between a scale of
unsatisfactory to outstanding performance and these ratings are susceptible to
various errors like central tendency, bias, halo effect, etc.