Answer to Question #297081 in Management for Jack Patz

Question

Discuss the pros and cons of at least four performance appraisal methods.

Answer 1

The employee performance appraisal process is crucial for organizations to boost employee productivity and improve their outcomes. Performance appraisals are an annual process where an employee’s performance and productivity is evaluated against a predetermined set of objectives. Performance management is not only important because it is the determining factor in an employee’s wage rise and promotion but also because it can evaluate an employee’s skills, strengths, and weaknesses accurately. With the right performance appraisal method, organizations can enhance employee performance within the organization. A good employee performance review method can make the whole experience effective and rewarding.

360-Degree Performance Method- The advantage of this method is that it provides a detailed information since it uses data from so many sources. It gives managers an idea of the leadership potential and style of an employee, the person's impact on overall team morale, and whether the employee is a professional who gets the job done. The negative side of this method is that it takes a lot of time and energy. Depending on how large a company or department is, this performance appraisal method could take the time of many people to conduct a 360-degree review for all employees. 

Self-Evaluation Method- The benefit of this method is that managers can get into the mind of the employees’. Managers don't always see a low-performing employee as a highly aspiring employee. Managers can identify motivated individuals with this method. It also gives employees a chance to define their own goals in professional development, achievement and promotion.The disadvantage of this method is that employees may not have a solid sense of self-awareness to provide quality information. Some employers also find some employees are not sincere in the evaluation, creating concerns about the accuracy of the evaluation.

Rating Scale Method- This method creates an even measuring tool for large groups of employees. Everyone is graded on the same topics and the same scale. It is a fast and easy method of evaluation, therefore it’s cost effective to administer. A negative issue with this method occurs when managers go through them so quickly, they truly don't consider the employee's performance. Some reviews may be more arbitrary than others, while some may be skewed by a bias if the manager favors one employee over another.

Management by objectives- This method is very thorough and can establish better, more positive relationships between supervisors and employees since it has managers and employees work together to identify and plan goals and proactively check in on progress. However, its often more time consuming and expensive than methods of performance appraisal. It demands careful planning and implementation to be successful.