Performance Appraisal Process

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Definition: Performance Appraisal Process is a well-thought step by step approach of evaluating the performance of the employees.

Performance Appraisal Process

Below are the performance appraisal process steps that are generally followed which results in an effective performance appraisal.

Performance Appraisal Process

  1. Objectives of performance appraisal
  2. Job analysis and Job description
  3. Communicate performance standards to the employees
  4. Measuring actual performance
  5. Discussing the appraisal
  6. Taking Corrective Actions
Performance Appraisal Process
Performance Appraisal Process

Objective of performance appraisal

Appraisals can be carried out for various reasons. These reasons might include deciding the pay rise and other benefits, promotions or demotions, job transfers or even layoffs.

In the above cases, some appraisals may be required to merely assess the performance while others might aim at improving the performance.

Job Analysis

Job specification and establishing performance standards- Job analysis is the second step to the performance appraisal process.

It is important to determine the job specifications i.e the precise characteristics of a job through an in-depth and detailed examination of the activities, tasks, duties and responsibilities that are required to do the job.

Once that is decided, performance standards are set against each task and activity. It is very important that the performance standards are clear and measurable. Goals behind each task of the job should be mentioned. Each goal should be achievable and measurable within a certain time and cost consideration.

Communicate performance standards to the employees

A job description should be very clear to the appraiser and the appraisee, they should know very well what all tasks and duties are expected out of them by clearly understanding the goal behind each task.

Performance standards should be communicated to the appraisee, their feedback should be taken on the set targets and standards, the communication needs to be a two-way communication where it should be open to any doubts or discussions and the appraisee should be coached and guided by the appraiser on how to achieve the performance standards effectively.

Measuring actual performance against standards set

After setting up the performance standards, communicating them to the appraisee and mutual acceptance is the next step to measure the actual performance against the standard set.

The performance can be measured objectively and subjectively through reports, information and observation by the supervisor etc. While doing this the influence on the employee performance of both external and internal factors is also considered.

Objective performance can be measured through reports, quantitative output etc and hence are easy to be verified. Subjective performance measure mainly depends on the observation and feedback by the supervisor and evaluates a person on his attitude, decision making, taking initiatives, contribution to the soci-cultural values of the organization etc.

Discussing the appraisal with the employees

The actual performance when compared to the standards might at times be above the expectation and sometimes it might go off the track and the same is discussed with the employees.

Taking corrective actions if necessary

Once the deviation from the actual performance is measured corrective actions are taken to help enhance the performance of the appraisee so that and he meets the expected standards. Similarly on the above expected performances, the employee is rewarded using different motivational tools.


  1. T. V. Rao, “Appraising and Developing Managerial Performance“, Excel Books, New Delhi, 1999.
  2. D. Grote, “Performance Appraisal Reappraised,’’ Harvard Business Review, Jan- Feb 2000.
  3. K. R. Murphy, J. Cleveland, “Performance Appraisal”, Boston, M. A: Allyn & Bacon, 1991.
  4. Scott Snell and G. Bohlander, “Human Resource Management”, Cenpager, New Delhi, 2007.

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