Performance appraisals are a critical part of any organization. They’re a formal review of how well an individual has performed on the job. Appraisals provide managers with opportunities to assess each employee, discuss their strengths and weaknesses and opportunities for growth. They can result in promotions, increments and awards, as well as corrective action where necessary.

For an organization, this means they need to conduct appraisals on time in a friendly and professional manner. Sometimes, the management also opens itself up to performance appraisal methods where junior staff evaluate their managers so they can benefit from the employee perspective.

Types Of Performance Appraisals

The techniques of performance appraisals vary from one organization to another. For example, some organizations conduct an appraisal annually, while others do so every six months. There are also various methods of performance evaluations and they have changed over time as technology has advanced and human resource practices have evolved. Which performance appraisal methods an organization opts for depends on several factors. Let’s explore the various types of performance appraisals and what they each bring to the table.

  1. Management By Objectives

This technique, in theory, is one of the simplest amongst performance appraisal methods. Specific objectives are set at the start of the appraisal period and then, at the end of the period, it’s decided if these objectives were met. Management By Objectives, or MBO, requires manager and employee to first carefully identify the objective. They should be easily measurable and clearly linked to a person’s performance. The manager should discuss their appraisal objectives with each employee as early as possible during the period of evaluation.

There are also downsides to these types of performance appraisals. For example, the organization may not know exactly how the employee approached the objective as they’re only examining the result. So process-related issues can get lost. It can also be time-consuming to monitor performance against objectives as the objectives have to be clearly defined and monitored. It also doesn’t leave room for changing objectives through the course of the project, unless a periodic review is built into the process.

  1. 360-Degree Feedback

A 360-degree feedback approach is one of the popular modern types of performance appraisals. It evaluates an employee’s performance in all areas of the job. It also allows each individual employee to provide a review on his or her own performance every year, besides collecting feedback from managers and peers.

The manager and the employee assess the employee’s performance over a period. They may also ask other employees for their opinions about the individual’s performance and then compare those statements with the self-assessment before giving the final feedback to the employee.

The various kinds of feedback that can be given include behavioral, development, learning curves and action plans. To properly assess employees, managers must first identify the specific job requirements.

This is one of the techniques of performance appraisals that’s time-consuming but when done correctly, 360-degree feedback can be one of the most effective types of performance appraisals. When it’s used for subordinates appraising managers, it can provide both parties with a better understanding of their respective roles in the organization. It creates an atmosphere that celebrates teamwork.

  1. Employee Self-Assessment

A self-assessment is one of the classic performance appraisal methods. It allows employees to evaluate themselves on their performance. In these broad techniques of performance appraisals, several tools and approaches may be adopted. Here are some examples:

  • Employees may fill in a form at the end of a period and turn it in to their managers. It may measure how well each employee is progressing toward set objectives or simply to collect information about individuals who are experiencing problems that need to be addressed.

  • The second approach is more interactive. The self-assessment questionnaire may be part of one of the more extensive techniques of performance appraisal, such as 360-degree appraisal.

  •  A self-assessment form may be given to an employee as part of a manager-led appraisal process.

Employee self-assessment forms are usually easy to fill out because they include a few questions about an employee’s satisfaction with their present job and their perception of their current level of performance.

The benefits are that it takes little time and effort from managers and helps managers and employees assess their own strengths and weaknesses.

  1. Reverse Feedback

While an employee’s appraisal by a manager is one of the most common types of performance appraisals, some organizations also do the reverse. An employee’s appraisal for a manager can help the manager identify areas of improvement. Here are some key points to consider:

  • The employee appraisal can be used for both individual and organizational performance management

  • Employees need to trust their organization before providing possibly negative feedback about their managers, so they must implement it with care, forethought and a guarantee of anonymity

We often see a reverse appraisal as part of a 360-degree feedback plan.

  1. Assessment Center

This is one of the modern methods of assessment that’s often used for hiring new talent as well. It comprises a series of tests and exercises designed to evaluate candidates on their competency in skills such as communication, data analysis, decision making, teamwork and leadership. Managers may use it to get a better understanding of a candidate’s capabilities for future leadership positions.

The tests are designed according to their purpose. For instance, if an organization is trying to understand which employees have the potential to take a management role down the line, they may organize a group activity followed by a presentation. The assessors will judge participants based on their displayed or overt behavior.

  1. Behaviorally Anchored Rating Scale

Behaviorally Anchored Rating Scale, or BARS, is a type of behavior-based rating scale used to evaluate performance. BARS has been highly accurate at identifying the competencies that make up an effective performer in a specific job. The method brings together qualitative and quantitative aspects of employee performance. Ratings can vary from 4 to 1 and are structured to identify specific factors that support effective performance. This is one of the types of performance appraisal methods that can be used for both individual and organizational performance management.

  1. Graphic Rating Scale

In a graphic rating scale, several descriptive words are listed, according to the needs of each job role. Managers evaluate employees based on each of these skills. It’s one of the performance appraisal methods well suited for unstructured jobs where the employee’s performance can’t be clearly defined as right or wrong. This method allows managers to evaluate their employees’ performance in different areas, such as leadership, teamwork, management skills and adaptability.

One of the major disadvantages of graphic rating scales is that the process takes a long time for managers because they must consider each word and its meaning before making their assessments. There may be additional descriptors that are more specific to the job at hand that requires further consideration. A graphic rating scale is a subjective assessment that relies on the manager’s discretion.

  1. Project Evaluation Review

A project evaluation review is best used when there’s a clear set of expectations and criteria that identify the job’s requirements. This method might require employees to identify how they did personally and as part of the team. Managers may then compare the employee’s performance with the expectations set out for them at the beginning of the project.

A review can be used on any kind of job. It can be time-consuming for both managers and employees.

We’ve covered various methods of performance evaluations. It might appear that the step up from being a team member being evaluated to being the manager conducting the evaluations is daunting. Fostering a spirit of teamwork and an open and trusting environment can make this process easier. These are skills that can be developed through Harappa’s First Time Manager Program. It’s a blended, online-first transformative program that gives the new manager confidence in their abilities to be an effective and nurturing leader. It covers must-have Thrive Skills such as giving constructive feedback and effective delegation that will ease the way, no matter the types of performance appraisal methods used by the organization. Become a better manager today!

Explore Harappa Diaries to learn more about topics such as Performance Appraisal, What Is 360-Degree Performance Appraisal and Behaviorally Anchored Rating Scale from Harappa that will help organizations tap into their employee’s potential. 

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