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This paper will critically examine the various types of performance appraisal techniques which organisations adopt in relation to both the employee and employer. Performance appraisal systems, traditionally has been one of the most critical responsibilities of Human Resource Management (Ferris and King,1991). The paper attempts to provide a reasonable level of systematic arguments through the study of different researches to provide further understanding from different scenarios which exist between employee and employer in an organisation. Consequently it will discuss the purposes and aims to be achieved from effective performance appraisal and its negative effects on the workforce and organisation as a whole. Finally a study into why performance appraisal system poses negative effects would be assessed and their requisite remedies would be discussed in order to prevent or minimise such problems from reoccurring. Performance appraisal plays a vital role towards organisational goals and objectives in relation to the employer and employee.
Performance appraisal systems are not generic or easily passed from one company to another; their design and administration must be tailor-made to match employee and organizational characteristics and qualities (Henderson, 1984).It is necessary to view in detail different types of appraisal techniques because that's very important towards assessing workforce performance. Therefore the further paragraphs will expatiate on the various types of appraisal techniques and their shortcomings.
According to Goff and Longenecker,(1990), self-appraisal should be encouraged in the overall process of performance appraisal system. Self-appraisal helps to provide individuals with self-improvement and also provide a communication link allowing the employer to compare performance results in the organisation, also provides insight for the employer as to how the employee views his or her performance (Boice and Kleine,1997). According to Miller & Cardy ( 2000), self-appraisal can be seen as a facade and individual behaviours can be a temporary adaptation to the observer and work situation, an influence of self-appraisal on performance ratings would be interpreted as bias and therefore it should be seen as a long term research goal to determine the extent to which it will operate as a valid or biasing factor on performance ratings. Newton and Findley (1996),research also made finding on how employees may tend to conceal limitations in their performance rating as it could have a negative effect on merit-related reward and promotional opportunities within the organisation.
Margerison et al (1995) elaborates on a broader view of performance appraisal system thus a collaborative team appraisal, as its faster and more coordinated within the organisation compared to self-appraisals .Margerison et al (1995) were able to come up with a structured way of measuring performance of a team (complementarity of team members have been taken into account in respect to how they balance individual strengths and present a quality unit together) and this measure was known as 'Margerison-Mccann' team performance index.
Team performance index(TPI) by Margerison et al (1995) is a comparable instrument where by members in the team can openly express their own personal views and also can be compared with views from individuals ,customers, suppliers or people in other teams and this in turn can be referred to as taking a 360-degree view point(which is also a type of appraisal). 'One of such efforts by Campion(1993) and his colleagues Medsker and Higggs (1993) attempted to address this issue directly by delineating a large set of design recommendations from a broad range of literature on groups, developing measures against productivity and satisfaction criteria in a sample of work teams'. Although conflicts might result from people working together in a team as they tend to have different skills and also employees in the team might try to show superiority over its colleagues. Certain researchers such as (Borman, 1991;Stell and Ovalle,1984;Tsui and Ohlott,1988) have come to a stand that's self-appraisal is weakly related to appraisal by employers or peers and it's the most inflated when considering other appraisal mechanisms. A typical example was given by (Meyer,1980) after a research was made showing at least 40 per cent of employees placing themselves in top category of the appraisal system.
According to (Alexander, 2006) 360 degree type of appraisal provides an employee with an opportunity to receive feedback from a well round group and the traditional review (e.g self-appraisal) does not offer such. Research carried out by (Alexander,2006) shed more light on how employer attitude can affect the reasoning and thinking of the employee in 360 degree review, where by the employer feels the process is irrelevant and time wasting , it will there by make the employee not take the programme serious and that's makes it ineffective and vice versa .A reasonable point was argued accordingly by (Fletcher and Baldry, 1999) saying despite the level of popularity of the 360 degree feedback programmes and from subsequent recent research on them, there is still a reasonable level of uncertainty and unawareness about the ratings used and relationships in respect to other significant work-related variables. Another intriguing and important point which argued by (Flecter,2001) due to the fact that 360 degree feedback involves more sources of evaluation in comparism to conventional appraisal, it may be at some level more objective and accurate, thou it will be difficult to support. Flecter et al 1998 further argued that different employers tend to make different assessments from their own respective subjective viewpoints, and thereby resulting to the qualities of 360 degree rating been no better that those typically found in top-down appraisal. According to (Brett, Atwater, 2001) in recent time, research and practice have provided a general consensus on both the benefits and potential problems related with 360 degree appraisals, particularly when it is used as an evaluation system rather than just a personal development technique.
Performance appraisal is a necessary tool which is used in organisations for both employers and employee to serve as a form of assessment, therefore its effectiveness is of great importance as it will determine the direction the organisation will more towards it been positive or negative. Further paragraphs will give a more comprehensive look at aims to achieve and also downsides of performance appraisal. Tznier, et. al., (2000) was able to come up with two broad reasons why organisations use performance appraisal: Firstly it can be used for making crucial decisions in the organization such as salary allocation, promotion of employee and assignments. Secondly, as a development process for employees such as criticizing the performance of employees, offering relevant feedback that will in turn set goals for improvement. It's vital to have a constant and continuous improvement on both the employer and the employees, in terms of skills, knowledge on the job, personal initiative and ability to weight options towards right decision making. Boice and Kleiner,(1997), believe that employees usually undertake performance appraisal so as to enable them know how their performance is compared with the employers expectation and identity areas that require training and development. According to (Goff and Longenecker,1990)training should commence with the primary focus on providing the employer with a systematic approach to the practice of effective people management. In further words, training is necessary in performance appraisal due to the fact that its equips and empowers both the employee and employer towards organisational goals, this in turn will have a positive effect on output and competence.
Conflict is a very important factor which must be considered between the employer and the employee towards achieving goals. Performance appraisal can be seen as a means to enable employers address employees without conflict in the organisation while carrying out individual objectives, tasks and operations. According to (Krein,1990), employers, managers or appraisers should avoid confrontation of its employee in the organisation directly with criticism, rather they should allow poor performance reveal itself as expected during the course of appraisal interview or sessions.
It should be carefully noticed that both employers and employee want to achieve a very high standard during performance appraisal on their job descriptions. According to DeVries et al (1981) performance appraisal process is necessary as its makes provision towards the evaluation of individual employees behaviour and accomplishments over a specific period of time.
Performance appraisals in respect to employer and employee have its downsides which will be discussed in this paragraph. According to Boice & Kleiner (1997) both researches took into consideration the legal reasons which is associated with having an effective appraisal system. Boice (1997)and his colleague came to a conclusion that's failure by companies to conduct proper appraisals, maintain adequate records may result in the employees or trade unions taking legal actions. Nobile (1991) supported this result as he stated that employers should make sure they adhere towards their commitments to conduct such reviews.
Performance appraisal can be seen as a waste of time and high cost. Reh (1998) argues that's performance appraisal done annually is a waste of time because it's too infrequent in nature as employees will not be able to be corrected right away for wrong doings in the organisation and this becomes an ingrained habit which will linger on for a long time and have an adverse effect on the competence of the employee and organisation. . According to Alexander(2006) organisational leaders, supervisors who gather information to complete performance evaluation are expensive (360 degree is the most comprehensive and cost orientated type of appraisal) and take time to deliver feedback to the employee.
According to Donovan and Kleiner(1994) stress can be perceived from three main sources which are physical ,mental and situational. Donovan and kleiner(1994) went further to explain these three sources: physical (results from been overworked, lack of proper feeding),
Mental (brought about by hopes, regrets, fears from daily activities which can be traced to the individual state of thinking) and finally Situational (issues relation to you matrimonial home, friends, cars ). Rojas and Kleine(2000) was able to come up with some positive effects in relation to stress as it enhances working efficiency, as a result from favourable stress conditions which fully speeds up the employees wisdom. Longernecker el at (1999) and Nelson and Burke,(2000) argue that stress is related to negative outcome in organizations.
It can be seen from previous paragraphs how performance appraisal system can differ in effectiveness between employer and employee and reasons why they differ. This paragraph will discuss reason why performance effectiveness can be a failure. Redman(2009) where able to notice that performance appraisal had one common cause of failure and it was narrowed down to participants been required to fill in large quantities of paperwork, which was practically ignored. Furthermore, Redman(2009) realized that making meaningful feedback was a challenge which was associated with the organisations that used 360 degree appraisal system . Despite the popularity of performance appraisal system, researchers such as (Silverman and Wexley, 1984;Kammerlind et al., 2004; Wright, 2004) believe that's it results to tension in the organization, as well as resistance and refusal among employees.
Measurement of performance can be difficult; Wright (1991) was able to come up with an assumption that some jobs are meaningful and not measurable while on the other hand jobs that are measureable will not be meaningful. Nisbett and Wilson (1977) have been able to pin point the longest notable and pronounced form of performance rating error known as Halo Effect. Another researcher by the name Thorndike(1920), characterized halo effect as an error where by the rater thinks of the individual in general as either good or bad, thereby making judgement by this general feeling .According to Jacobs and Kozlowski (1985) to the pervasiveness of this sort of error, it has been a knew liability in performance ratings.
Managers in organisations tend not to like performance appraisals; research carried out by Longnecker (1989) found that managers in organisations often manipulate the appraisal ratings in order to suit their own personal interest. In support of Longnecker(1989),another research done by Snape et al (1994) put further light saying :managers frequently tamper and play games with performance ratings. Redman(2009) also believe that organisations which are being subjected to political manipulation also experience discredits in performance appraisal systems.
According to Murphy and Cleveland (1995), performance appraisal was developed in the time when organisations where stable in terms of work homogeneity, high level of job security, and organised. In recent time Wiese and Buckley (1998 ) have a different view as a result of further research, it has been realized that changes have occurred such as: workforce don't longer exist in a homogenous form, internal and external environments in organizations are more of dynamic than static. This will affect the effectiveness of performance appraisals systems adversely as employees are likely to change jobs, organizations and even on a career bases.
In Conclusion it is evident that performance appraisal system is necessary and of great importance towards the employer and the employee. Previous findings and arguments from this paper have been able to deduce why effective appraisal systems are required and also why they should be carefully considered before venturing into it. This paper has been able to identify the strengths and weakness of performance appraisal systems in organizations and has been supported by different researchers. There are been a reasonable linkage between employee and employers in the organisation, in terms of the types of appraisal systems (self- appraisal, team appraisal and 360 degree appraisal).Also these appraisal system have their own certain limitations which affects the effectiveness of performance appraisal in organisations. Although, it has been noticed that's there are certain factors which inhabit organisation from getting involved in performance appraisal such as manipulation in ratings, politics, inherent errors which affects the accuracy of the appraisal reviews, irrelevant feedback and time constraints. Furthermore, Training has been since as essential towards making the employer and employees aware of certain organizational goals which must be met.
Organisational goals are the main objectives with performance appraisal must be tailored into or else it will not be worth it for any organisation to get involved. Employers and employees have been able to improve on their competence and best of all know what is expected from them by the organisation. Effective performance appraisal has enabled organisations and employees to weight their options in terms of decision making, fairness of relationship and judgement. It has also enabled individuals to know when training and development is required to make them more productive and give room for self-improvement.
It can finally be said that's Performance appraisal is used by many organisations in spite of the problems its poses towards employers and employee.