Appraisals Effectiveness And Its Impact On Employee Motivation Business Essay

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In todays competitive business world, it is implicit that organizations can only compete with their rivals if they are Market-Driven. To be a market driven organization, an organization should be innovative, customer focus, competitor intelligence and most important involvement and support of the entire organization. Effective human resource management helps organization to achieve its targets within a given time. The human resource system can be more efficient by having a valid and accurate appraisal system used for rating employee's performances. Unfortunately, there are very few organizations that use effective performance appraisal system.

The perception of employees about the uses and outcomes of the PAS would be beneficial depending on a number of factors. For example, employees are more likely to be receptive and supportive of a given PA programmed if they perceive the process as a useful source of feedback which helps to improve their performance (Mullins, 2007). Employees are likely to participate in PA if they perceive it as an opportunity for promotion, personal or career development in the future. On the other hand, if employees perceive it as an unreasonable attempt or a formality by management, various reactions may result. The overall PAS will be effective if the appraisal system is clearly explained and satisfy employees.

Accurate appraisal system could only be achieved if raters provide objective and unbiased ratings to employees. Optimal mix of both subjective and objective appraisal is done by many organizations these days. Instead of using these two approaches there are numerous problems for actual assessment. The existence of such problems suggests that PAS may become bias or errors resulting in unequal evaluation of different employees. It must be free from biasness.


In Faysal bank HR practices and applications are managed by HR Co-coordinators. As the business increases with the time the HR department was satisfied by a variety of functions and becomes the backbone of any company because it becomes crystal clear upon them that retaining that employee is the most precious tangible asset of the company, in spite of including them in companies balance sheet but they are the one upon whom these balance sheets work.

The internationalization of business is well recognized in terms of the importance of trade and growth of international corporations especially in the field of service sector where new innovation takes place rapidly and the older replaces with new each day. The world has become borderless and new emerging markets attract competitors in the same field which attracts customers with wide range of distinctive and easy services. The (www) saga has changed the way of thinking and defining things, now HR department takes active part into strategic decision making. Companies are now on the view point that valid assessment of an employee makes him responsible because it builds a strong base and now it is the founding pillar that stands still to support the beams.

The idea of Performance appraisal system has its own distinctive and undivided accomplishments. Companies use performance appraisal activities annually to make employees more productive and loyal to the organization, whereas an employee's show his interest because he knows that this performance evaluation paid him in the same company, as well as in the near future.

Keeping in view the international aspect and competition with the local and international banks Faysal bank also making its HR system better and make appraisal system according to international standard to compete in an international environment. Thus strategic focus is to make a loyal and productive workforce.

Statement of Problem

To find out the perception of employees about performance appraisal effectiveness at Faysal Bank Ltd (Korangi Branch). A common perception of employees the more we work for organization the more rewards we got. A newly and fresh candidate give his extra efforts no matter It is seen by supervisor. But what happen if a loyal employee works for the whole year and in return get only a small increment in the salary which is far lower than his efforts. Every employee work for the future growth of his career and personal development. PAS is the best tool for the measurement of an employee but the use of this tool by unprofessional employers makes jack a dull boy.

Significance of the study

The research study on employee's perception about performance appraisal effectiveness has its own strategic importance. For a service oriented organization, it is important to develop a workforce which is entirely committed to the success of organization. They can deal with customers in the way that helps a company to make larger loyal customer base. This success for a company can only be achieving through employee involvement and support in the organization. . It rejects the olden thought of labor intensive industries in which you only need to work for the employer but now you don't need to work for the employers because the prospective has changed and transformed the statement into "Work with the employer". This work with the employer means that to gear up the company in a manner that we all grow, it is not only the employer whose wealth account multiplies but it is the worker also whose skills add new domains to his profile.

Currently organizations who work with the theme of traditional top down or Seth culture can't achieve their objectives within a given time period. The only reason is dissatisfaction of employees about their future growth and career development. There is a need to improve the traditional culture operates within the local organizations in Karachi. To make it more significant, I have included the examples of perfect appraisal system of big corporate giants and multinational firms.

In this research I have included the importance of performance appraisal system in an organization which leads to the appraisal of an employee because in the end it becomes the basis for his/her growth.

Scope of study

The research study depicts a universal concept of how performance appraisal works and how it affects the performance of the employees by motivation and other performance boost factors. But the research is limited because for the purpose of being specific I have chosen Faysal Bank Limited (Korangi branch) where 140 employees working. The bank has operations all over Pakistan and is consisted of around 25000+ employees all over Pakistan.


Research is conducted on the performance appraisal system of Faysal Bank regarding its effects on employee performance and motivation in 2012 and 2013. Performance appraisal policies may change in future.