Each employee shares both major and minor responsibilities for the success of a company. His performance and ability to deal effectively with the tasks he is assigned, as well as the goals he has to achieve are directly related to the total enterprise performance and profitability.
So, it is important to set realistic goals for each employee and evaluate his performance to avoid negative consequences and use all his knowledge and skills in favor of the company. When a proper performance appraisal system is set, it can benefit both employers and employees by improving job performance, by making it easier to identify strengths and weaknesses and be determining suitability for development.
Employee appraisal should not be limited to a review only once a year. Apart from this formal annual review some employee categories, such as newcomers, long serving employees, or underperformers should receive frequent performance reviews.
Employees should see all the appraisal reports that are related to them. They should also be given the opportunity to express their views regarding the appraisal they have received in a given period.
For appraisal schemes to be successful and work it is necessary that senior managers are fully committed to the idea and appraisal process. It is also necessary to design the appraisals based on the contribution and comments by all stakeholders. The objectives of the appraisal scheme should be determined before the system is designed. These objectives will dictate the methods and performance criteria for appraisal, so they are discussed with employees, managers, and trade unions to obtain their views and commitment. People who conduct appraisal interviews should be trained accordingly, in order to be fair and objective. Finally the appraisal scheme should be kept as easy and straightforward as possible.