Performance appraisals aim at building and maintaining a satisfactory level of performance. They also aim at contributing to employee growth and improvement through training and management development programs. One of its purposes is to help the superiors have a good understanding about their subordinates. They also play a major role in guiding employees to job changes with the help of constant ranking. Another objective of employee performance appraisals is to facilitate fair and equitable compensation based on performance and to facilitate testing and validating selection tests. It also provides information for taking decisions concerning layoff and retrenchment and suggesting change in employee behavior, if required.
Organizations have to decide the content to be appraised before the program is accepted. Normally, the content to be appraised is determined on the basis of job analysis. The content to be appraised may vary with the purpose of appraisal, type of appraisal, and position of employees. Properly conducted performance appraisals let employees know how well they are performing and also considerably influence the employee's future level of effort and task direction. Performance appraisal is an organized description of an employee's job-relevant strengths and weaknesses. Appraisals are mostly arranged periodically according to a specific plan.
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