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1. What is a performance appraisal system
In this file, you can ref useful information about what is a performance appraisal system such as
what is a performance appraisal system methods, what is a performance appraisal system tips,
what is a performance appraisal system forms, what is a performance appraisal system phrases
… If you need more assistant for what is a performance appraisal system, please leave your
comment at the end of file.
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• 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 what is a performance appraisal system
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Performance appraisal deals with how organizations evaluate and measures its employees
achievements and behaviors. It is an employee review by his manager where his work
performance is evaluated and strengths and weaknesses are identified so that the employee
knows his improvement areas. Performance appraisal is the right time to set new goals and
objectives for the employees.
Before we look into the types of Performance appraisal system, let us check out the purpose of it.
So what is the purpose of a performance appraisal system?
Performance appraisal system allows the management categorize employees into performers and
non-performers. It is primarily done to estimate the employees’ worth.
Going back to the types, there are different variations of performance appraisal systems. Let us
list them down and see a bit of what they are:
 Behavioral checklist: Behavioral checklist has a list of criteria that an employee should
workup to be a diligent worker. The behaviors differ according to the type of job been
assessed. This method is considered favorable as the evaluation is done on the basis of
individual employee performance without comparisons.

2.  360 degree appraisal: 360 degree appraisal involves feedback of the manager, supervisor,
team members and any direct reports. In this method of appraisal, employees complete
profile has to be collected and assessed. In addition to evaluating the employees work
performance and technical skill set, an appraiser collects an in-depth feedback of the
employee.
 Management by objective: This is an objective type of evaluation which falls under
modern approach of performance appraisal. In MBO method of performance appraisal,
manager and the employee agree upon specific and obtainable goals with a set deadline.
With this method, the appraiser can define success and failure easily.
 Psychological appraisals: This appraisal method evaluates the employees intellect,
emotional stability, analytical skills and other psychological traits. This method makes it
easy for the manager in placing the employees in appropriate teams.
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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

3. in the organization. The ranking system does not eliminate
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.

5. III. Other topics related to What is a performance appraisal system (pdf
download)
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