Distinguish between ‘Performance Appraisal’ and ‘Potential Appraisal’. Also discuss in brief, the methods of performance appraisal.

Question 3: Distinguish between ‘Performance Appraisal’ and ‘Potential Appraisal’. Also discuss in brief, the methods of performance appraisal. Performance Appraisals is the assessment as sessment of individual’s performance in a systematic way. way. It is a developmental tool used for all a ll round development of the employee and the organization. The performance is measured against such factors as job knowledge, quality and quantity of output, initiative, leadership abilities, supervision, dependability, cooperation, judgment, versatility and health. !ssessment should be con"ned to past as well as potential performance also. The second de"nition is more focused on behaviors as a part of assessment because behaviors do a#ect job results. $erformance $erformance appraisal helps to rate the performance of the employees and evaluate their contribution towards the organizational goals. Performance appraisal as Career Deelopment leads to the recognition of the work done by the employees, many a times by the means of rewards and appreciation etc. It plays the role of the link between the organization and the employees’ personal career goals.

Potential appraisal , a part of $erformance $erformance appraisal, helps to identify the hidden talents and potential of the individuals. Identifying these potential talents can help in preparing the individuals for higher responsibilities responsibilities and positions in the future. The performance appraisal process in itself is developmental in nature.  The techniques of appraisal have been divided divided into two categories% The modern and the traditional techniques. &hile the traditional methods base their "ndings on the personality trades of an individual like creativity, creativity, responsibility, responsibility, and leadership, the modern techniques laid more stress on the evaluation of work results. The traditional methods or techniques are%

!. Con"dential report: It is used for promotion and transfer of an employee and is prepared by the immediate superior who describes in detail the strength and weaknesses along with major achievements and failures of the employee. The personality and behavior of the employee also "nd mention in this report. #. $ssa% or free form method:  !s the name suggests the appraiser write a short essay detailing the performance of the employee. It is a very time consuming method and is prone to buys also as speci"c performance dimensions are not considered. The quality of appraisal also depends on the

writing skills of the appraiser. It is also di'cult to compare two (ssay appraisals as there is no common criterion for the appraiser.

3. &tra%ed ran'ing method:  This is the old and simplest method of performance appraisal. In this method ranks are assigned relatively to all the employees working in the same unit and doing the same job without analyzing their performance. The method biased as the ranking is not based on the speci"c performance measures of a job. It can be cumbersome if the number of employees is very large. The other limitations of this method are that it only tells how an employee stands in comparison with other employees. (. )orced distribution method:  In this method the evaluator is required to distribute his rating in the form of normal frequency distribution. (mployees are shown in categories that range from poor to e)cellent by the evaluator.  This method was evolved by *oseph Ti'n but it also su#ers from certain limitations as the performance criteria related to a job are not used and the reasons for assigning a category to particular employee are not clear. *. +raphic or linear rating scale:  In this method a numerical scale is used which indicates di#erent degrees to a particular trait. These traits can be initiative dependability creativity attitude loyalty emotional stability and co ordination. The evaluator gives a particular ranking on each trait to every employee. Two types of rating scales are used% +ontinuous and discontinues. In "rst type degree of a trait is measure along a continuum like  -  /. I0 discontinues rating scale bo)es are used to show the di#erent degrees of the traits like 1I2 no interest 1II2 indi#erent 1III2 Interesting 1I32 enthusiastic 132 very enthusiastic. . Critical incident method:  This method was developed after a research by the armed forces of 4nited 5tates of the nd world war. It is based on a principal that there are some signi"cant acts in the behavior and performance of every employee which can lead to the success of failure on the job. The supervisor keeps a record of these events which can be good or bad and also records the behavior of the employee during such an event.  The ratings of the employee depend on the positive or negative behavior during these events. This method also has certain limitations like it is cumbersome and time consuming and a lot of important information is lost while coating the incident after a considerable gap of time. +ontinues record keeping is also not possible as such events keep on happening frequently.

 The bios by the supervisor in reporting these incidents can also not be ruled out completely.

-. +roup appraisal method:  (mployees are rated by a group of people comprising the immediate supervisor of the employee and other supervisor who have the knowledge of the employee work along with the concerned head of the department and a personnel e)pert. This group determines the standards and then measures the actual performance of the employee. It suggests creative measures after analyzing the causes of poor performance.  Though it is a time consuming method, it is free from bias.