Article 3

 01.Comparison of  Performance Appraisal and Performance Management

 02. Approaches of Performance Appraisal. 

Performance appraisal and performance management are two distinct concepts that work together.

Traditional performance appraisal simply involves evaluation of an employee's performance which focuses on reviewing past performance against established standards and often results in a rating or score. This process does not involve any kind of management.  Performance appraisal involves hierarchical, downward communication from supervisor to subordinate concerning the value the supervisor places on the subordinate’s performance (Mello, 2013). The characteristics of the performance appraisal are

l Looks back at past performance - Retrospective

l Primarily concerned with judging performance. - Evaluative

l Typically conducted annually or semi-annually

l More rigid and structured.

l Tends to be more quantitative

 

Performance management is an ongoing continuous process of identifying, measuring, and developing the performance of individuals and teams and aligning their performance with organization’s goals. In comparing performance management and performance appraisal, “the distinction is the contrast between a year-end event – the completion of the appraisal – and a process that starts the year with performance planning and is integral to the way people are managed throughout the year (Dessler and Varkkey, 2011). The characteristics of the performance management are,

l A continuous process, not just a single event.

l Focuses on improving future performance.

l Aims to prevent performance problems.

l Flexible and adaptable.

l Tends to be more qualitative.

 

Basically, Performance appraisal is a component of performance management. However performance management is beyond performance appraisal, and does not just deal with how employees perform at the end of the year; it takes care of the employees throughout the year and also the learning and development part of the each employee for the future. Performance management ensures that the employees’ goals are aligned to organization’s goals. It also modifies itself based on the employee performance at every stage so that employees are in track and deliver to their potential. It also helps employees improve their potential and productivity. Key distinction between Performance Appraisal and Performance Management could illustrate in table 01 as follows, (Rath A, 2018)

Performance Appraisal versus Performance Management

	Performance Appraisal	Performance Management
Time period	Past	Past, present and future
Focus	Create records; document performance problems	Link employee work activities to specific business objectives and strategy
Nature of communication	One-sided, downward, directive; "rebuttal" sometimes allowed	Two-way
Employee role	Passive	Active participant
Formality	High formality, written forms with signatures	Informal, verbal
Timing	As prescribed (annual/semi annual)	Spontaneous & ad hoc needed
Basis of relationship	Power	Collegiality
Role of supervisor	Authority figure	Coach, motivator, partner
Outcomes	Compensation decision; task directives	Participation; enhanced, targeted performance; improved relationships

Source: Mello, 2013

 Approaches of Performance Appraisal.

 

Traditionally, most employers base pay and promotional decision on the employee’s appraisal. Secondly, the appraisal lets the boss and subordinate develop a plan for correcting any deficiencies, and to reinforce the activities the subordinate does right. Third, appraisals provide an opportunity to review the employee’s career plans in light of his or her exhibited strengths and weaknesses. Fourth, appraisals play an integral role in the employer’s performance management process. Fifth, in Indian firms where HR information systems are not well evolved, the reports of appraisals serve as the source of most of the current employee information (Dessler and Varkkey, 2011).

There is a great degree of variation in the approaches, design and use of performance appraisal system and also in the formats. Three key approaches used in making performance appraisal include (Balasubramanian, 2002):

· Traditional Approach: This approach is highly systematic and takes into account the measurement of employee characteristics and/or their contribution or both. In this system all employees are rated in the same manner utilizing the same approach so that the rating of separate personal can be compared.

· Casual Approach: This approach is an unsystematic use and often haphazard appraisal system which was commonly used on the past, but now it has given a place to more formal methods, the main basis being seniority or quantitative measure of quantity and quality of output for rank and file personnel.

· Behavioral or Modern Approach: This approach is based upon mutual goal setting and appraisal of progress by both appraiser and appraisee. This lays emphasis on behavioral values of fundamental trust in goodness, capabilities, and responsibilities of human beings

 

List of references

 

Ø DeNisi, A. S., & Murphy, K. R. (2017). Performance appraisal and performance management: 100 years of progress?. Journal of applied psychology, 102(3), 421.

Ø Murphy, K. R., Cleveland, J. N., & Hanscom, M. E. (2018). Performance appraisal and management. Sage Publications.

Ø Mello JA, 2013 Strategic Management of Human Resources, Third Edition, Cengage Learning.

Ø Rath A, 2018, “Evolution of Performance Management System”, Volume No.06, Issue 02.

Ø Erialdy, E. (2024). Employee performance appraisal using individual performance management. JPPI (Jurnal Penelitian Pendidikan Indonesia), 10(1), 361-367.