Do I Need a Performance Appraisal System?

Most companies now run on an appraisal system of one sort or another.  Typically, the performance appraisal process is used to evaluate employee achievement and behaviour.

Also read: Why You Should Discuss “Proud Employee Moments” In Performance Reviews

The most common type of appraisal is still the annual review, which is conducted by a manager.  The review discusses overall work performance and showcases the strengths and weaknesses of an employee.  This helps employees understand which areas they need to improve in.

What is the Purpose of a Performance Appraisal System?

Introducing a performance appraisal system into your company helps management to categorise employees into performers and non-performers.  This is primarily done to help identify the strengths and weaknesses of employees and help them to set developmental goals.

An appraisal system will assess staff performance against a list of set objectives and will help to guide employees on a course of future development.

When a performance appraisal system is managed well, it can help employees to progress and achieve more. This way, performance appraisal systems can have a significant impact on the success of your business.

To evaluate whether or not your business could benefit from introducing an appraisal system, ask yourself these questions:

Do All Managers Provide the Same Level of Evaluation?

We can all agree that some managers will go all out when it comes to evaluating and providing feedback to employees.

However, some managers will put in minimal effort.  If you want all of your employees to have equal opportunities, it’s important that you can standardise the performance appraisal process.  This is where an appraisal system would be required.

How Can I Make Changes Based on Performance Appraisals?

The last, and perhaps most crucial step in any performance appraisal is implementing changes based on feedback from your managers.

Based on the results of an appraisal, employees could be put forward for a raise, extra bonuses or even a promotion.  Adopting a performance appraisal system ensures that these types of changes – be they good or bad – are acted upon.

Is Your Company Already Using a Talent Management System?

If you’re already using a talent management system, we have good news!  The vast majority of these systems will already include a built-in performance appraisal function.  This means that you will already have the foundations for a performance appraisal system in place.

Also read: How to develop your own HRMS

If you opt to introduce a talent management system, this can help streamline the entire appraisal process.

Types of Performance Appraisal Systems

Nowadays, appraisal systems come in many forms.  These systems help companies to go beyond a simple, and often unstructured annual review.  There are a wide variety of systems to check out.  Let us list a number of the most popular options below:

  • Behavioural Checklist
  • 360 Degree Appraisal
  • Management by Objective
  • Review Cycle and Comparison Tools
  • Competency Management Software

Regardless of the type of performance appraisal system you introduce, the system should encourage, motivate and empower your employees to help them deliver their maximum.  You will easily be able to find out more info on the different types of performance appraisal systems you can introduce to your company online.

 

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