Importance of Performance Management and Appraisal in Human Resource Management

 

Figure 01: Aspects of Performance Management and Appraisal

Human resources management plays an essential role in the design and implementation of performance management and appraisal hence it is the responsibility of the human resources personnel to make sure that the assessment procedure is more effective to achieve organizational goals.  Performance appraisals are critical to the development of an organization as well for the individual employees since it aids the firm in determining whether an employee is productive or a liability for the company which is a fundamental aspect of human resources management. Therefore, performance management refers to the collection of actions and duties which used to ensure that personnel fulfill their objectives on time. The aims of the employees must match with the goals of the organization and when the goals are met, performance management guarantees that the work performed by the employees are efficient and effective. 

A holistic approach to performance management means that it considers the needs of both the person and the company when assessing how well employees are doing their job duties. It's the evaluation of an employee's work that constitutes performance appraisal. Employee competencies, such as dedication to the organization's fundamental values, capacity to take initiative and responsibility for the tasks they are responsible for, strengths and weaknesses, skill set, and trainings are evaluated in performance appraisals. 

Figure 02: Process of Performance Management and Appraisals


Purpose of Carrying out Performance Management and Appraisals 

  • A performance review is essential to identify an employee's strengths and weaknesses, as well as how those strengths and weaknesses may be utilized and developed for the company's future growth and development.
  • Keeps track of an employee's performance throughout his or her tenure with the company and even thereafter.
  • Offer a chance for both the employee and the employer to discuss their expectations of one another's work, as well as to provide feedback and assessments on the quality of one's own performance.
  • Assess the training needs 
  • In performance review meetings, management and workers have a chance to open up the lines of communication, allowing them to express their opinions.
  • It aids in the identification of an employee's potential and other areas of skill, which the company may use to provide them the opportunity to explore further.

Benefits of Carrying out Performance Management and Appraisals

  • Performance Management and Appraisals improve the morale of employees and encourage them to work harder to achieve the company's goals.
  • Evaluations of an employee's performance assist in determining how the position of that person affects the effectiveness of the team as a whole.
  • It creates a meritocracy that encourages people to do their best work in the hopes of being rewarded for it.
  • Employees can be promoted based on their performance through performance evaluations. 
  • The HR department benefits greatly from performance evaluations and reviews since it allows them time to plan for future employee recruiting 
  • Provide a clear picture for the human resource department whether an employee is doing well or not. 
  • It aids managers in putting up plans for their workers' refreshment and professional growth based on the results of their performance evaluations. 

References

Mitrefinch. (2018). Why Performance Appraisals are Important - Mitrefinch Blog. [online] Available at: https://www.mitrefinch.ca/blog/employee-engagement/why-performance-appraisals-are-important/#:~:text=Performance%20appraisals%20are%20essential%20for.

Anon, (2016). KPI | 9 Benefits of the Performance Appraisal. [online] Available at: https://www.kpi.com/en/blog/2016/01/18/10-benefits-of-the-performance-appraisal-system/.

Thakur, M. (2019). Importance of Performance Appraisal | Purpose, Tips and Merits. [online] EDUCBA. Available at: https://www.educba.com/importance-of-performance-appraisal/.

BenefitCorp. (2020). Why are Performance Appraisals Important? [online] Available at: https://benefitcorp.com/why-are-performance-appraisals-important/.

Comments

  1. Dilini MBAApril 26, 2022 at 7:43 AM

    As explained, performance management is essential to ensure that employees meet their targets, whether they need any training and to develop skills to move up the hierarchy. HRM should ensure that a transparent and effective performance management system is in place. Good article. All the Best!

    ReplyDelete

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