Importance of Effective Employee Appraisals

The performance appraisal may be one of the few times during the year where an employee and the reviewer, typically the employee’s supervisor, can sit down and have a lengthy face-to-face discussion about all aspects of the job. Thus, the appraisal can serve a number of important functions. If done effectively, the appraisal can offer a large degree of satisfaction for both the employee and the reviewer.

Giving and Receiving Feedback
An effective employee appraisal provides an opportunity to give feedback as well as receive it. The employee receives important information as to what areas of the job she is performing well and those that need improvement, so she knows exactly where she stands. The reviewer can also receive feedback from the employee that can help her make improvements in the work environment. The reviewer may also uncover issues that could be impeding employees from performing their best, and she can take corrective measures if necessary.

Setting Goals
In addition to reviewing performance based on previously established goals, the performance appraisal is also a good time to establish new goals. If deficiencies are identified during the appraisal, the reviewer and employee can work together to establish new goals as well as develop a plan to reach them. For example, if a salesperson missed his sales quota for the year, he and the reviewer can establish a plan to reach next year’s quota by increasing call activity by a certain percentage.

Improving Communication
Employee appraisals are important for improving communications between the employee and reviewer. By speaking openly about the job performance and issues that may be affecting it, the employee and reviewer can develop a sense of trust that may have been lacking. Employees who previously did not feel comfortable approaching the reviewer with a problem may become more likely to voice her concerns, which can prevent a small issue from escalating into a major problem over time.

Measuring Recruitment Efforts
Performance appraisals can provide key information that can help evaluate recruiting practices. For example, if a high percentage of workers who were hired within a recent time frame scored well on their appraisals, the company may conclude that its recruiting process is working effectively. On the other hand, the presence of many poor performers may indicate that the recruiting efforts are missing the mark and the hiring process may need an overhaul.

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