Types of Employee Appraisal (DP IB Business Management)

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Written by: Lisa Eades

Reviewed by: Steve Vorster

An Introduction to Employee Appraisals

Staff appraisal is a process where a manager or supervisor assesses an employee's job performance

Diagram: discussion points in employee appraisals

**Appraisal discussions reflect on employee performance and establish goals for the future**

Performance is measured against the tasks and responsibilities stated in the employee's job description
Constructive feedback is given and there is a discussion of goals and development opportunities

Advantages and Disadvantages of Employee Appraisals

Advantages	Disadvantages
Feedback & Communication Structured platform for managers to give constructive feedback on employee performance Open & honest communication helps to address concerns & set expectations	Subjectivity Can be influenced by personal biases or prejudices of the appraiser Managers may evaluate employees differently based on personal relationships or perceptions
Performance Improvement Identifies where employees may need training, development or support to improve performance Encourages self-awareness and self-improvement	Anxiety & Stress Employees may fear feedback or potential negative consequences High-stakes appraisals can lead to demotivation or performance anxiety
Recognition & Motivation Recognises & rewards employees for their achievements & contributions Opportunity to acknowledge employees' hard work & dedication	Time-Consuming Takes both managers and employees away from other productive work Filling out forms and conducting meetings can be cumbersome
Decision-Making Supports decisions related to promotions, salary increases & bonuses based on merit Identifies high-potential employees for leadership development	Inaccuracies May not accurately reflect an employee's performance due to a lack of objectivity The process may fail to capture the full range of an employee's contributions and skills

Formative Appraisal

A formative appraisal involves gathering ongoing information and feedback on employee performance
- Managers and workers have regular performance management conversations
- Prompt adjustments can be made to improve performance
- Methods used to gather information for formative appraisal may include
  - employee observations
  - aptitude tests
  - skills tests
  - feedback from peers
- Formative appraisal is commonly used during training or probation periods

Characteristics of Formative Appraisal

Characteristic	Explanation
Ongoing Feedback	It is conducted continuously throughout the period of employment or training Workers receive feedback on their progress, identify areas for improvement and make necessary changes to enhance performance
Improvement-Oriented	The primary goal is to help workers make improvements Provides insights into what is/is not working well
No or Low Stakes	Assessments in formative appraisal do not heavily impact a worker's employment Minimal pressure on employees encourages them to focus on improvement
Timely Feedback	Specific, constructive and actionable feedback is provided promptly Workers can use it to make immediate improvements
Employee Involvement	Employees are encouraged to be actively involved in the process They may self-assess, set goals and reflect on their own progress towards goals

Summative Appraisal

Summative appraisal is typically conducted yearly or at the end of a work assignment
Its main purpose is to assess and measure the overall performance, achievement or outcomes of employees
Summative appraisals are often used to make decisions related to pay or promotion

Key Characteristics of Summative Appraisal Include

Characteristic	Explanation
Endpoint Assessment	Summative appraisal occurs at the end of the year, cycle or project Teacher performance is appraised following the publication of examination results Performance of sales staff is often measured monthly or quarterly
Evaluation of Achievement	It focuses on the overall outcomes and results achieved by the employee Teacher performance is measured against the results achieved by students in examinations Performance of sales staff is usually measured against the volume or value of sales achieved
High-Stakes	It can have significant consequences such as determining pay, promotion or continued employment

360 Degree Feedback

360 Degree feedback provides employees with feedback from within and outside their organisation
- Feedback comes from multiple stakeholders who have direct contact with the employee
- Stakeholders may include line managers, colleagues, suppliers and customers

Diagram: the 360 degree appraisal process

**360-degree feedback can be collected from a range of internal and external sources**

Feedback can be gathered from a range of internal and external sources
- Feedback is typically gathered through surveys or questionnaires
- Responses are usually anonymised to encourage honest feedback
- After feedback is collected, it is shared with the employee in the appraisal process
It is considered to provide a comprehensive assessment of an individual's strengths, weaknesses and training/development needs

The Main Uses of 360 Degree Feedback

Performance Appraisal	Personal Development
Evaluate an employee's performance and contributions	Identify areas for improvement and help employees improve their skills
Career Development	Leadership and Management Development
Assist individuals in career planning and advancement within the organisation	Assess and develop leadership and managerial skills

360 Degree feedback can be a valuable tool when used effectively
- It should be implemented carefully to ensure that it serves its intended purpose and does not lead to conflicts or resentment
- It is essential to have a clear process for collecting, analysing and providing feedback and to use the information obtained for employee development

Self-appraisal

Self-appraisal involves employees evaluating their own performance, skills, strengths, weaknesses and achievements
It is commonly used in the workplace as part of the performance management process
Self-appraisal is typically used alongside evaluations from managers or supervisors to provide a comprehensive view of an individual's performance

Typical Elements of Self-Appraisal

Element	Explanation
Achievements	Employee describes accomplishments and contributions made during a specific period This may include projects completed, goals met or tasks successfully accomplished
Strengths	Employee identifies strengths, skills and capabilities that have been valuable to the organisation
Areas for Improvement	Weaknesses or areas where the worker believes they can make positive changes are identified This may include acquiring new skills, addressing specific shortcomings or improving behaviours
Goals & Development Plans	Set goals for future improvement and outline plans to achieve them This may include training or skills development
Self-Reflection	Employee reflects on their overall performance Evaluates how it aligns with organisational goals/values

The Value of Employee Self Appraisals

The process can lead to increased self-awareness
The process provides an opportunity for employees to share their perspectives and goals with their supervisors, which can promote open dialogue
The process identifies areas that need improvement and by setting clear goals for the future, it supports professional growth and development
The process can balance out the evaluation process as it allows employees to express their viewpoints and provide context/balance

Last updated: 29 October 2024

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