Performance appraisal, as a routine means for a manager to provide their direct reports with formal feedback on their performance, is a long-established practice in almost all larger organisations. According to the CIPD 2005 survey on performance management , 65% of organisations operated a system of individual annual appraisal and 27% a bi-annual scheme.
In concept, appraisals provide organisations and employees with a guarantee: if all else fails, there will be at least one occasion in the year when employees will receive some feedback from their manager and employers will be able to obtain a broad picture of the extent to which performance is meeting expectations. In practice, it seems that some appraisal schemes are failing to achieve even this much – according to research conducted by ACAS, less than half of employees say their manager provides them with feedback on their performance. The view from the HR department seems to depend on the mode of appraisal, as evidenced by these results from the CIPD survey mentioned earlier:
However imperfect, a formal appraisal process is a necessary ingredient in most organisations’ performance management systems. According to appraisal specialists Archer North , “The human inclination to judge can create serious motivational, ethical and legal problems in the workplace. Without a structured appraisal system, there is little chance of ensuring that the judgements made will be lawful, fair, defensible and accurate.”
Performance appraisals are:
- at their best when conducted regularly, when open and honest, when they constitute a two-way discussion;
- best avoided when no more than a form-filling exercise, when focused on pay and reward, when they avoid difficult issues.