11 Key Objectives of Performance Appraisal in 2024

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Objectives of Performance Appraisal
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Performance appraisals is a common occurrence in the modern workplace. Managers and employees are utilizing performance appraisal to provide employees with adequate rewards and recognition in their workplaces.


There are several key objectives of performance appraisal which help the company understand the performance levels of their employees. The objectives of performance appraisal ensure the performance appraisal is relevant for the organization.


Since it evaluates the performance of the employees, you must ensure that the process is simple, transparent as well as provide adequate performance review to the staff. Hence, we will be discussing the 11 key objectives of performance appraisal in this blog, which makes the process relevant for the organization.



What is Performance Appraisal?

The performance appraisal process is a continuous evaluation of the employees based on their performance. It considers both the quantity and the quality of their work and evaluates them based on pre-defined parameters by managers and HR.


Performance appraisal highlights the employee’s skillset and helps them receive the recognition they deserve. Performance appraisal is a task which were conducted annually, where the performance of employees were evaluated. However, the changing work culture has resulted in companies undertaking continuous performance reviews and providing feedback.


The reporting manager usually provides feedback to the employee by providing an overview of their overall performance. They also help the staff understand whether they have achieved the targets and goals set for them the previous year.


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Frequency of Performance Appraisals

The legacy method for performance appraisals is by undertaking annual reviews. However, in the current fast-paced work environment, it is ideal to undertake continuous performance appraisals to improve their performance.


It helps provide the employee with relevant on-time feedback, which they can instantly implement to improve the performance and quality of their work. Even if the company is not providing constant reviews, they have started providing feedback to their staff members once every 3 to 6 months.


Such timely reviews ensure that the employee stays on track and their productivity stays on time. Combined with the usage of performance measuring tools and software, it becomes easier for the managers and employees to undertake employee performance feedback, which makes for engaged staff.



Advantages of Performance Appraisals

There are multiple benefits of performance appraisal such as:


➔ Improved Employee Performance

Since their appraisals are based on their performance, the employees would be eager to accomplish their tasks on time, while maintaining the quality standards set by the company.


➔ Enhanced Employee Growth

For better performance, the employee would take up additional courses or undertake their training in the company with renewed vigour.


➔ Employee Work Goal Alignment

Since performance appraisal help the employees understand their deficiencies related to work, it helps them better align their work goals with that of their company.


➔ Better Work Motivation

Appraisals motivate an employee to work better as their work is directly proportional to their performance appraisals.


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Key Objectives of Performance Appraisals

Employee’s Performance appraisals are undertaken to fulfil the objectives of the company and the management. It enables employees to progress in their careers while improving their productivity in the organization.


Here are 11 of the key objectives of employee’s performance appraisal:


1. Set Employee Goals

For successful performance appraisals, employees should be aware of the expectations of the company. Hence, companies provide their staff members with relevant goal setting as per their expectations for their staff.


Once employees are aware of these goals, they will strive to achieve them for getting better appraisals. The employee goals can be set towards improving the operations, processes or even client servicing quality, based on their job roles.


Companies should undertake goal setting for their employees, which are specific to their work. These goals should be quantifiable and hence, measurable. You should also ensure that the goals remain achievable and relevant to the employee.


2. Motivate Performers

With the help of a performance appraisal, you can motivate the better performers further by helping them understand the exact expectations of the company. The management can share their exact requirements with the staff and be assured that they will achieve their targets on time.


Sharing the appraisal results also helps the employees to identify the specific parameters they are measured with, helping them undertake their tasks better to meet those specific requirements.


High performers are often provided with additional incentives for undertaking their job well since their performance helps the company achieve their organizational targets. Hence, performance appraisals prove effective for keeping them motivated and engaged with their company.


3. Boost Confidence

A performance appraisal help employees to identify the impact their work makes on the organization. It helps them realize their work is appreciated by their management, which boosts their confidence.


Hence, the management should let their performer know the exact parameters while sharing their feedback. Additionally, by including praise for their work, the employee understands they are performing their tasks well.


It encourages them to keep up their work quality and sustain their work quality. Such words of praise will motivate the staff to work harder and to improve their performance and quality of their work.


4. Meaningful Recognition

It is a well-established fact that recognition for their work helps employees feel engaged and satisfied with their work. Hence, it is essential to recognize the staff for their work.


While a formal appreciation letter would be enough to appreciate their excellent work, studies have found that providing meaningful relevant public appreciation often improves the quality of their work.


On the other hand, one should ensure that the recognition being awarded is meaningful to the employee and helps them stand out in front of their peers. The feeling of being recognized for their work and awarded for their excellence in undertaking it will help the employee sustain their performance too.


5. Counsel Under-performers

While it helps to motivate the achievers, one should not forget the strengths and weaknesses too. It is essential to counsel the under-performers to understand what is keeping them from undertaking their tasks well.


There could be a variety of reasons which are keeping the employee from achieving their true potential. With adequate counsel and guidance, you can understand the root cause of the issue and work together with them to resolve it.


The manager should work with the employee to understand what are the issues due to which their performance is lackluster and develop a plan to improve it.


6. Transparent Evaluations

Since performance reviews are subject to internal and external bias, it is necessary to undertake them transparently to ensure a fair judgement. Human beings are inherently biased and the same will affect the judgement of the managers while evaluating their staff.


Hence, it is necessary to keep the feedback process transparent, by keeping the employee in the loop, every step of the process. To ensure the transparency of the process, all new joiners should be provided with a detailed explanation of the feedback and appraisal process.


They should also be provided with their KRAs and KPIs to ensure a clear understanding of the company’s expectations. It would also be ideal to keep either an online or offline performance review handbook to ensure enhanced transparency.


7. Recognize Training Needs

The performance review process considers the employee’s training effectiveness too. Hence, determining the overall training requirements is included as an objective of the performance appraisal process.


Hence, the process requires you to specify the individual training and development needs of the employee, track their progress, measure the current training effectiveness, and more.


Understanding the current training and development statistics along with the employee’s performance figures will help you understand the training required by them.


Hence, the training and development requirements can be enumerated in-depth and the resulting changes can be implemented to improve the overall company productivity.


8. Plan Recruitment

With the help of frequent performance appraisal, you can understand whether your employees are being stressed out by excess work. Consequently, you can develop a recruitment plan to hire more staff to ensure an adequate workforce.


It will also help the managers and HR team in making a strong case for hiring new staff while presenting their request before the upper management. It will also help you identify the performers of the team and provide them with an opportunity for promotion, engaging them effectively.


Hence, you can change your recruitment plans accordingly, creating a productive workforce for your company.


9. Improve Productivity

A robust performance appraisal system ensures improved overall productivity in the organization since it sets the performance goals for each employee.


The performance appraisal process becomes streamlined and stays consistent throughout a company, while the non-biased feedback from the management helps the staff understand the relevance of their work.


As a result, organizational performance improves, leading to increased profitability. With the help of regular performance feedback, HR and management can also ensure sustained performance from their staff. They can easily understand if anyone’s performance is dropping and take necessary corrective measures, resulting in an efficient company.


10. Simplified Promotion

Performance appraisal helps us understand the employees who would be ideal for promotions. With measurable KPIs, a performance appraisal system ensures that you have the necessary figures if anyone raises doubts about their colleague’s promotion. The process of promotion also becomes easy and transparent with the deployment of a performance appraisal system in place.


Having such a system in place would also avoid unwarranted bias and favouritism, leading to a fair and just workplace, which will further enhance the engagement rate of the staff. Further, one can also understand how much raise is to be given to a specific employee based on their performance.


11. Compliance

If employees are not provided a performance appraisals for any reason, they can challenge your decision. Similarly, consistently poorly performing employees are fired from their positions, if they fail to perform their duties despite providing multiple training opportunities.


In such cases, the employee can challenge your decision stating that the decision was biased or unethical. Hence, it is necessary to have a robust performance management system in place.


With such a system, you would have a record of their consistent performance issues, which can even be presented in case of any issues. This system will create a paper trail for you to present as evidence to justify your reasons for terminating the employee or denying their performance.


Simplify Appraisal Process with Pocket HRMS



A performance appraisal is an essential component of employee management. Hence, understanding the key objectives of performance appraisals will help you gain a competitive edge over your competition. It will lead to better productivity, better performance, enhanced profitability, and engaged staff.


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