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1. Benefits of performance appraisal
In this file, you can ref useful information about benefits of performance appraisal such as
benefits of performance appraisal methods, benefits of performance appraisal tips, benefits of
performance appraisal forms, benefits of performance appraisal phrases … If you need more
assistant for benefits of performance appraisal, please leave your comment at the end of file.
Other useful material for you:
• performanceappraisal123.com/1125-free-performance-review-phrases
• performanceappraisal123.com/free-28-performance-appraisal-forms
• performanceappraisal123.com/free-ebook-11-methods-for-performance-appraisal
I. Contents of getting benefits of performance appraisal
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Companies use performance reviews to evaluate and assess the performance of individual
employees on the job. Performance appraisals are typically used to explore each employee's job
growth and to set goals and benchmarks to strive for during the next appraisal period.
Understanding the benefits of performance appraisals can help managers and supervisors make
the best use of them.
Targeting Needs
Performance appraisals can target a specific area of weakness that needs evaluation and
remediation. It can also serve as a valuable tool for establishing goals that will lead to
promotions and career advancement. Using a performance appraisal to uncover training needs
allows the company to focus efforts on narrowly defined areas.
Charting Progress
Performance appraisals can be used to chart progress. Comparing performance appraisals from
one benchmark period to another will provide both the company and the employee with
measurable marks of improvement, lack of improvement or regression in job performance areas.
These data are valuable for human resources. Salary increases, demotions, promotions and
terminations are all elements that can be tied to the progress reflected in performance appraisal
data.
Building Relationships

2. Performance appraisals give the employer and employee the opportunity to sit down and discuss
performance. In busy companies, where everyone is taking care of business, periodic meetings
between supervisor and employee allow them to form or strengthen a relationship. Developing
this rapport opens a line of communication for the employee to use in making future suggestions
for the company or applying for promotions.
Motivating Employees
Performance appraisals often serve as motivational tools for employees. The company may offer
a bonus or other perk to employees who are able to improve their performance appraisals from
one period to the next. It is important to offer improvement opportunities, such as training
seminars, mentorships or classes to employees desiring to improve their performance appraisals.
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III. Performance appraisal methods
1.Ranking Method
The ranking system requires the rater to rank his
subordinates on overall performance. This consists in
simply putting a man in a rank order. Under this method,
the ranking of an employee in a work group is done
against that of another employee. The relative position of
each employee is tested in terms of his numerical rank. It
may also be done by ranking a person on his job
performance against another member of the competitive
group.
Advantages of Ranking Method
i. Employees are ranked according to their performance
levels.
ii. It is easier to rank the best and the worst employee.
Limitations of Ranking Method
i. The “whole man” is compared with another “whole man”
in this method. In practice, it is very difficult to compare
individuals possessing various individual traits.
ii. This method speaks only of the position where an
employee stands in his group. It does not test anything
about how much better or how much worse an employee
is when compared to another employee.
iii. When a large number of employees are working, ranking
of individuals become a difficult issue.
iv. There is no systematic procedure for ranking individuals
in the organization. The ranking system does not eliminate

3. the possibility of snap judgements.
2. Rating Scale
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. Advantages – Adaptability, easy to use, low cost,
every type of job can be evaluated, large number of
employees covered, no formal training required.
Disadvantages – Rater’s biases
3. Checklist method
Under this method, checklist of statements of traits of
employee in the form of Yes or No based questions is
prepared. Here the rater only does the reporting or
checking and HR department does the actual evaluation.
Advantages – economy, ease of administration, limited
training required, standardization. Disadvantages – Raters
biases, use of improper weighs by HR, does not allow
rater to give relative ratings
4. Critical Incidents Method

4. The approach is focused on certain critical behaviors of
employee that makes all the difference in the
performance. Supervisors as and when they occur record
such incidents. Advantages – Evaluations are based on
actual job behaviors, ratings are supported by
descriptions, feedback is easy, reduces recency biases,
chances of subordinate improvement are high.
Disadvantages – Negative incidents can be prioritized,
forgetting incidents, overly close supervision; feedback
may be too much and may appear to be punishment.
5. Essay Method
In this method the rater writes down the employee
description in detail within a number of broad categories
like, overall impression of performance, promoteability
of employee, existing capabilities and qualifications of
performing jobs, strengths and weaknesses and training
needs of the employee. Advantage – It is extremely
useful in filing information gaps about the employees
that often occur in a better-structured checklist.
Disadvantages – It its highly dependent upon the writing
skills of rater and most of them are not good writers.
They may get confused success depends on the memory
power of raters.
6. Behaviorally Anchored Rating Scales
statements of effective and ineffective behaviors
determine the points. They are said to be
behaviorally anchored. The rater is supposed to
say, which behavior describes the employee
performance. Advantages – helps overcome rating
errors. Disadvantages – Suffers from distortions
inherent in most rating techniques.

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