View source for Performance appraisal

{{Short description|Method to document and evaluate an employee's job performance}}
{{Redirect|Performance evaluation|the academic journal in science|Performance Evaluation{{!}}''Performance Evaluation''}}
{{redirect|Performance review|the television episode|Performance Review}}
{{Use dmy dates|date=February 2015}}

A '''performance appraisal ('''also known as a '''performance review''', '''performance evaluation''', '''career development discussion''', or '''employee appraisal'''),{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}<ref>{{cite web |title=Conducting the Development Discussion – Manager's Tips |url=http://hrweb.mit.edu/system/files/Conducting%2Bthe%2BDevelopment%2BDiscussion%2B-%2BManager%2BTips_0.pdf |archive-url=https://web.archive.org/web/20100327021924/http://hrweb.mit.edu/system/files/Conducting%2Bthe%2BDevelopment%2BDiscussion%2B-%2BManager%2BTips_0.pdf |archive-date=27 March 2010 |publisher=MIT Human Resources}}</ref> is a periodic process where the job performance of an [[employee]] is documented and evaluated. 

Performance appraisals are most often conducted by an employee's immediate [[manager]] or [[line manager]].<ref name="Tyskbo 2020 Line management involvement">{{cite journal |last1=Tyskbo |first1=Daniel |title=Line management involvement in performance appraisal work: Toward a practice-based understanding |journal=Employee Relations|date=8 March 2020 |volume=42 |issue=3 |pages=818–844 |doi=10.1108/ER-06-2019-0236 }}</ref> While extensively practiced, annual performance reviews have also been criticized as providing feedback too infrequently to be useful,<ref>{{cite journal |last1=Evans |first1=Samantha |last2=Tourish |first2=Dennis |date=July 2017 |title=Agency theory and performance appraisal: How bad theory damages learning and contributes to bad management practice |url=https://kar.kent.ac.uk/58816/3/Appraisal%20Revisions%20Sept%202016.pdf |journal=Management Learning |volume=48 |issue=3 |pages=271–291 |doi=10.1177/1350507616672736}}</ref> and some critics argue that performance reviews in general do more harm than good. It is a [[Principal–agent problem|principal-agent framework]] that describes the relationship of information between the employer and employee, in particular the direct effect and response received when a performance review is conducted.<ref name="Waterman Meier 1998 Principal-Agent Models">{{cite journal |last1=Waterman |first1=R. W. |last2=Meier |first2=K. J. |title=Principal-Agent Models: An Expansion? |journal=Journal of Public Administration Research and Theory |date=April 1998 |volume=8 |issue=2 |pages=173–202 |doi=10.1093/oxfordjournals.jpart.a024377 }}</ref>

Performance appraisals are a part of [[career development]].

== Objectives ==
Performance appraisal, as part of a [[Business performance management|performance management]] system, aims to increase the efficiency of the organisation and reduce inefficiencies that arise from subordinate work that fails to align with corporate goals.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}<ref name="Waterman Meier 1998 Principal-Agent Models" /><ref>{{cite journal |last1=DeNisi, A. S., & Murphy, K. R. |date=2017 |title=Performance appraisal and performance management: 100 years of progress? |journal=Journal of Applied Psychology |volume=102 |issue=3 |pages=102(3), 421–433 |doi=10.1037/apl0000085 |pmid=28125265}}</ref> Performance appraisal [[interview|interviews]] provide [[feedback]] to employees,<ref name="Performance appraisal and performance management: 100 years of progress?">{{cite journal |last1=DeNisi, A. S., & Murphy, K. R. |date=2017 |journal=Journal of Applied Psychology |pages=102(3), 421–433}}</ref><ref name="Schraeder">{{cite journal |last1=Schraeder |first1=Mike |last2=Becton |first2=J Bret |last3=Portis |first3=Ron |date=Spring 2007 |title=A Critical Examination of Performance Appraisals: An Organization's Friend or Foe? |journal=The Journal for Quality and Participation |volume=30 |issue=1 |pages=20–25, 47 |id={{ProQuest|219158187}}}}</ref> at the same time facilitating collaboration and discussion on pay, career development and progression,<ref name="Schraeder" /><ref name="Twomey">{{cite journal |last1=Twomey |first1=Daniel F. |last2=Harris |first2=Drew L. |date=March 2000 |title=From strategy to corporate outcomes: Aligning human resource management systems with entrepreneurial intent |journal=International Journal of Commerce and Management |volume=10 |issue=3/4 |pages=43–55 |doi=10.1108/eb047408 |id={{Gale|A78789240}}}}</ref><ref name="Spinks" /><ref name="Selden">{{cite journal |last1=Selden |first1=Sally Coleman |last2=Ingraham |first2=Patricia Wallace |last3=Jacobson |first3=Willow |date=September 2001 |title=Human Resource Practices in State Government: Findings from a National Survey |journal=Public Administration Review |volume=61 |issue=5 |pages=598–607 |doi=10.1111/0033-3352.00130}}</ref> and employee discipline,<ref name="Cederblom">{{cite journal |last1=Cederblom |first1=Douglas |date=April 1982 |title=The Performance Appraisal Interview: A Review, Implications, and Suggestions |journal=Academy of Management Review |volume=7 |issue=2 |pages=219–227 |doi=10.5465/amr.1982.4285572}}</ref><ref>{{cite journal |last1=Biron |first1=Michal |last2=Farndale |first2=Elaine |last3=Paauwe |first3=Jaap |date=2011 |title=Performance management effectiveness: Lessons from world-leading firms |url=https://scholarsphere.psu.edu/resources/6d887837-d41d-4ea5-b354-4d0109f78358 |journal=The International Journal of Human Resource Management |volume=22 |issue=6 |pages=1294–1311 |doi=10.1080/09585192.2011.559100}}</ref><ref>{{cite book |last1=Perry, J. L. |title=Managing human behavior in public and nonprofit organizations |date=2018 |publisher=CQ Press}}</ref><ref>{{cite journal |last1=Budd, J. W., Gollan, P. J., & Wilkinson, A. |date=2010 |title=New approaches to employee voice and participation in organizations |journal=Human Relations |pages=63(3), 303–310}}</ref><ref name="Cawley">{{cite journal |last1=Cawley |first1=Brian D. |last2=Keeping |first2=Lisa M. |last3=Levy |first3=Paul E. |date=August 1998 |title=Participation in the performance appraisal process and employee reactions: A meta-analytic review of field investigations. |journal=Journal of Applied Psychology |volume=83 |issue=4 |pages=615–633 |doi=10.1037/0021-9010.83.4.615 |id={{ProQuest|614338480}}}}</ref> clarifying the expectations of subordinates, communicating their effectiveness in achieving those goals, and ideally improving employee engagement and satisfaction.<ref name="Spinks" />{{sfn|Grote|2002|pp=28–29}}<ref name="DeNisi6">{{cite journal |last1=DeNisi |first1=Angelo S. |last2=Pritchard |first2=Robert D. |date=July 2006 |title=Performance Appraisal, Performance Management and Improving Individual Performance: A Motivational Framework |journal=Management and Organization Review |volume=2 |issue=2 |pages=253–277 |doi=10.1111/j.1740-8784.2006.00042.x}}</ref><ref name="Performance appraisal in public sec">{{cite journal |last1=Kim, S. |date=2020 |title=Performance appraisal in public sector: Motivating public employees through PAs |journal=International Journal of Public Administration |pages=43(2), 91–105}}</ref><ref name="Den Hartog">{{cite journal |last1=Den Hartog |first1=Deanne N. |last2=Boselie |first2=Paul |last3=Paauwe |first3=Jaap |date=October 2004 |title=Performance Management: A Model and Research Agenda |url=https://repub.eur.nl/pub/1779/ERS%202004%20068%20ORG.pdf |journal=Applied Psychology |volume=53 |issue=4 |pages=556–569 |doi=10.1111/j.1464-0597.2004.00188.x}}</ref> Appraisals can also enhance [[motivation]] by recognizing the contributions of employees and providing them with growth opportunities.<ref name="Performance appraisal in public sec" /> Although they can help facilitate management-employee communication, if not executed appropriately, they may result in legal issues or instead weaken employ morale towards organizational goals and values.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}<ref name="Schraeder" /><ref name="Sudarsan">{{cite journal |last1=Sudarsan |first1=A |date=2009 |title=Performance appraisal systems: A survey of organizational views |journal=The Icfai University Journal of Organizational Behavior |volume=3 |issue=1 |pages=54–69}}</ref> 

Performance appraisals may increase diversity in leadership positions by ensuring fairness in hiring and promotion, particularly of individuals of socially-excluded backgrounds,<ref>{{cite journal |last1=Aguinis |first1=Herman |last2=Joo |first2=Harry |last3=Gottfredson |first3=Ryan K. |date=2011 |title=Why we hate performance management—And why we should love it |journal=Business Horizons |volume=54 |issue=6 |pages=503–507 |doi=10.1016/j.bushor.2011.06.001}}</ref><ref name="Public and private management: What">{{cite journal |last1=Boyne, G. A. |date=2010 |title=Public and private management: What's the difference? |journal=Journal of Management Studies |pages=39(1), 97–122}}</ref> especially when such appraisals are done in a [[Cultural sensitivity|culturally-sensitive]] manner.<ref name=":0">{{cite journal |last1=García-Chas, R., Neira-Fontela, E., & Varela-Neira, C. |date=2016 |title=High-performance work systems and job satisfaction: A mediating role of trust and labour unions |journal=Human Resource Management Journal |pages=26(2), 238–254}}</ref> Such appraisals may also provide an opportunity to prevent misunderstandings that may arise, including those stemming from [[Cultural diversity|cultural differences]].<ref name="Performance management in public se">{{cite journal |last1=Christensen, T., & Laegreid, P. |date=2020 |title=Performance management in public sector organizations: Complexity and hybridization |journal=Public Organization Review |pages=20(1), 1–15}}</ref> Appraisal methods are not necessarily able to be transferable cross-culturally.{{sfn|Hofstede|2001|p={{page needed|date=September 2024}}}} [[Trade union|Labor unions]] provide a platform against the misuse of appraisals to reinforce managerial bias or justify unfair terminations, particularly of marginalised persons.<ref name=":0" /> Some unions have argued that these systems be accessible to employees and their representatives,<ref>{{cite journal |last1=García-Chas, R., Neira-Fontela, E., & Varela-Neira, C. (2016). High-performance work systems and job satisfaction: A mediating role of trust and labour unions. Human Resource Management Journal, 26(2), 238-254. |title=High-performance work systems and job satisfaction: A mediating role of trust and labour unions |journal=Human Resource Management Journal |pages=26(2), 238–254}}</ref> and should reflect collective efforts rather than focusing solely on individual accomplishments, as collaboration is key in creating an inclusive public workforce.<ref>{{cite journal |last1=Benson, J. |title=Performance management systems and employee relations: A critical perspective |journal=Labour Studies Journal |pages=46(2), 155–173}}</ref>

Some management theorists have argued that performance appraisals are crucial for manager in sales and other departments or industries.<ref name="Muczyk">{{cite journal |last1=Muczyk |first1=Jan P. |last2=Gable |first2=Myron |date=1987 |title=Managing Sales Performance through a Comprehensive Performance Appraisal System |journal=The Journal of Personal Selling and Sales Management |volume=7 |issue=1 |pages=41–52 |jstor=40471747}}</ref><ref name="Sudarsan" /> In the public sector, the usage of performance appraisals may further align with public-service values of transparency and accountability.<ref name="Performance appraisal in public sec" /><ref name="Performance management in public se" />

== Implementation ==
A performance appraisal is a systematic, general and periodic process that assesses an individual employee's job performance and productivity in relation to certain pre-established criteria and organizational objectives.<ref name="Manasa">{{cite journal |last1=Manasa |first1=K. V. L. |last2=Reddy |first2=Nivedita |date=2009 |title=Role of Training in Improving Performance |journal=The IUP Journal of Soft Skills |volume=3 |issue=3 & 4 |pages=72–80 |ssrn=1526983}}</ref><ref name="Abu">{{cite journal |last1=Abu-Doleh |first1=Jamal |last2=Weir |first2=David |date=January 2007 |title=Dimensions of performance appraisal systems in Jordanian private and public organizations |journal=The International Journal of Human Resource Management |volume=18 |issue=1 |pages=75–84 |doi=10.1080/09585190601068334}}</ref> Other aspects of individual employees are considered as well, such as [[organizational citizenship behavior]], accomplishments, potential for future improvement, strengths and weaknesses.<ref name="Manasa" />{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}<ref name="Broady">{{cite journal |last1=Broady-Preston |first1=Judith |last2=Steel |first2=Lucy |date=December 2002 |title=Employees, customers and internal marketing strategies in LIS |journal=Library Management |volume=23 |issue=8/9 |pages=384–393 |doi=10.1108/01435120210439861}}</ref> There are three main methods of data collection: objective production, personnel, and judgmental evaluation. Judgmental evaluations are the most commonly used with a large variety of evaluation methods.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} Historically, appraisals have been conducted annually (long-cycle appraisals);<ref>2014 Performance Management Survey http://performancereviews.net/survey/</ref> however, many companies are moving towards shorter cycles, and some have been moving into short-cycle (weekly, bi-weekly) appraisals.<ref name="Cederblom" /><ref name="Sudarsan" /><ref name="Cappelli Tavis 2016 The performance management revolution">{{cite journal |last1=Cappelli |first1=Peter |last2=Tavis |first2=Anna |date=2016 |title=The performance management revolution |url=https://hbr.org/2016/10/the-performance-management-revolution |journal=Harvard Business Review |volume=94 |issue=10 |pages=58–67}}</ref><ref name="Selden2">{{cite journal |last1=Selden |first1=Sally |last2=Sowa |first2=Jessica E. |date=September 2011 |title=Performance Management and Appraisal in Human Service Organizations: Management and Staff Perspectives |journal=Public Personnel Management |volume=40 |issue=3 |pages=251–264 |doi=10.1177/009102601104000305}}</ref> 

The use of multi-source feedback – incorporating evaluations from peers, subordinates, and customers – over traditional supervisory ratings may assist to improve rating accuracy by reducing [[Illusory superiority|leniency bias]] and [[centrality bias]].<ref>{{cite journal |last1=Barbieri, D., Gorbatai, A., & Kazman, R. |title=The Performance of Performance Appraisal Systems: A Theoretical Framework for Public Organizations |journal=Review of Public Personnel Administration |date=2021}}</ref> Transparent appraisal systems reduce the risk of surprise negative evaluations, a concern especially pertinent for [[social exclusion|socially excluded]] groups that may already face [[systemic bias]] in the workplace.<ref>{{cite journal |last1=Pyman, A., Holland, P. J., Teicher, J., & Walpole, K |date=2010 |title=Industrial relations climate, employee voice, and managerial attitudes to unions: An Australian study |journal=British Journal of Industrial Relations |pages=48(2), 258–282}}</ref> Cognitive biases such as the [[anchoring effect]] and [[halo effect]] can impact the accuracy of appraisals used to identify training and professional development needs by relying too heavily on initial information when making judgments or a rater's overall positive impression of an individual, both of which can influence the assessment of performance, leading to biased judgments that influence evaluations.<ref>{{cite journal |last1=Belle, N., Cantarelli, P., & Belardinelli, P. |title=Cognitive Biases in Performance Appraisal: Experimental Evidence on Anchoring and Halo Effects With Public Sector Managers and Employees |journal=Review of Public Personnel Administration |pages=37(3), 275–294}}</ref> Researchers have found that the [[Organizational citizenship behavior|organizational citizenship behavioral]] dimensions of altruism and civic virtue can have just as much of an impact on manager's subjective evaluations of employees' performances as employees' objective productivity levels.<ref name="MacKenzie">{{cite journal |last1=MacKenzie |first1=Scott B |last2=Podsakoff |first2=Philip M |last3=Fetter |first3=Richard |date=October 1991 |title=Organizational citizenship behavior and objective productivity as determinants of managerial evaluations of salespersons' performance |journal=Organizational Behavior and Human Decision Processes |volume=50 |issue=1 |pages=123–150 |doi=10.1016/0749-5978(91)90037-T}}</ref>

Performance appraisal systems serve the purpose of documenting appraisal processes and results. Proper documentation ensures performance is recorded transparently, safeguarding all parties in case of disputes around wrongful termination or discrimination.<ref>{{cite journal |last1=Choi, S., Hong, S., & Lee, H. |date=2020 |title=The role of performance appraisals in managing employment relations |journal=Employee Relations |pages=42(3), 667–687}}</ref>

=== Characteristics ===
Performance appraisals can provide room for discussion in the collaboration of individual and organizational goals.<ref name="Kikoski">{{cite journal |last1=Kikoski |first1=John F. |date=December 1998 |title=Effective Communication in the Performance Appraisal Interview: Face-To-Face Communication for Public Managers in the Culturally Diverse Workplace |journal=Public Personnel Management |volume=27 |issue=4 |pages=491–513 |doi=10.1177/009102609802700405}}</ref>

=== Process ===
The performance management process begins with leadership within the organization creating a performance management policy.<ref name="Selden" /> Theorists such as [[Peter Drucker]] have argued that performance management and appraisal systems ought to align individual and organizational performance.<ref name="Den Hartog" /><ref name="Molleman">{{cite journal |last1=Molleman |first1=Eric |last2=Timmerman |first2=Hugo |date=February 2003 |title=Performance management when innovation and learning become critical performance indicators |journal=Personnel Review |volume=32 |issue=1 |pages=93–113 |doi=10.1108/00483480310454745}}</ref><ref name="Ayers 2015 Aligning Individual">{{cite journal |last1=Ayers |first1=Rebecca S. |date=June 2015 |title=Aligning Individual and Organizational Performance: Goal Alignment in Federal Government Agency Performance Appraisal Programs |journal=Public Personnel Management |volume=44 |issue=2 |pages=169–191 |doi=10.1177/0091026015575178}}</ref> Activities to support the appraisal process include suitable models of assessment, appropriately credentialed staff, employee engagement training, and improvement actions.<ref>{{cite book |last1=Milgram |first1=L. |title=Managing Smart |date=1999 |isbn=978-0-88415-752-6 |page=17 |chapter=Management by Objectives (MBO)—Setting SMART Goals |doi=10.1016/b978-0-88415-752-6.50018-7}}</ref><ref>{{cite journal |last1=Yi |first1=Ran |date=January 2023 |title=Self-Knowledge and Learner Engagement in Hybrid Classrooms |journal=CALR Linguistics Journal |issue=13 |doi=10.60149/wtrx5743|doi-access=free }}</ref><ref>{{cite journal |last1=Sepahvand |first1=Faribah |last2=Mohammadipour |first2=Fatemeh |last3=Parvizy |first3=Soroor |last4=Zagheri Tafreshi |first4=Mansoureh |last5=Skerrett |first5=Victoria |last6=Atashzadeh-Shoorideh |first6=Foroozan |date=April 2020 |title=Improving nurses' organizational commitment by participating in their performance appraisal process |journal=Journal of Nursing Management |volume=28 |issue=3 |pages=595–605 |doi=10.1111/jonm.12961 |pmid=31958192 |doi-access=free}}</ref>

=== Data collection ===

* The objective production method consists of direct measures such as sales figures, production numbers, and the electronic performance monitoring of data entry workers.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} Although these measures deal with unambiguous criteria, they are usually incomplete and of reduced [[Validity (logic)|validity]] because the variability in performance can be due to factors outside of the employee's control,{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} and because the quantity of production does not necessarily indicate the quality of the products.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}
* The personnel method is the recording of withdrawal behaviors (i.e. absenteeism, accidents). Most organizations consider unexcused absences to be indicators of poor job performance, with [[Ceteris paribus|all other factors being equal]], although this might not actually be the case in practice.<ref name="Staw">{{cite journal |last1=Staw |first1=Barry M. |date=July 1986 |title=Organizational Psychology and the Pursuit of the Happy/Productive Worker |journal=California Management Review |volume=28 |issue=4 |pages=40–53 |doi=10.2307/41165214 |jstor=41165214}}</ref>{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}
* Judgmental evaluation is the appraisal of performance by judgments of other employees, supervisors, or customers, commonly by way of rating. These tools typically take the form of a multi-format questionnaire that might include VAS, Likert scoring and the collection of both quantitative and qualitative data by a number of means.<ref name="ReferenceA">{{Cite journal |last1=Yang |first1=Anita |last2=Brown |first2=Anna |last3=Gilmore |first3=Rachel |last4=Persky |first4=Adam M. |date=October 2022 |title=A Practical Review for Implementing Peer Assessments Within Teams |journal=American Journal of Pharmaceutical Education |language=en |volume=86 |issue=7 |page=8795 |doi=10.5688/ajpe8795 |pmc=10159466 |pmid=34697020}}</ref> The most common types of error in collecting such data are [[Cognitive bias|cognitive biases]] and [[statistical errors]] such as [[illusory superiority|leniency errors]], [[central tendency]] errors, and errors resulting from the [[halo effect]].{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}<ref name="Belle et al 2017 Cognitive Biases in Performance">{{cite journal |last1=Belle |first1=Nicola |last2=Cantarelli |first2=Paola |last3=Belardinelli |first3=Paolo |date=September 2017 |title=Cognitive Biases in Performance Appraisal: Experimental Evidence on Anchoring and Halo Effects With Public Sector Managers and Employees |journal=Review of Public Personnel Administration |volume=37 |issue=3 |pages=275–294 |doi=10.1177/0734371X17704891}}</ref>{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} 

==== Rating methods ====
For judgmental evaluations, raters are often trained to improve the validity of the data and reduce errors.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}{{sfn|Gomez-Mejia|Balkin|Cardy|2011|p={{page needed|date=September 2024}}}} Although meaningful in theory,<ref name="Sudarsan" /> such training may be expensive, time-consuming, and fail to produce meaningful results.<ref name="Sudarsan" />

It is not uncommon for rating inflation to occur due to raters being motivated to give higher ratings because of the lack of organizational sanction concerning accurate/inaccurate appraisals, the rater's desire to guarantee promotions or salary increases, the rater's inclination to avoid negative reactions from subordinates, and the observation that higher ratings of the ratees reflect favorably upon the rater.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} 

The main methods used in judgmental performance appraisal are:{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}

*[[Rating scale|Graphic rating scale]]: graphic [[scale (social sciences)|rating scales]] are the most commonly used system in performance appraisal.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} On several different factors, subordinates are judged on 'how much' of that factor or trait they possess. Typically, the raters use a 5- or 7-point scale; however, there are as many as 20-point scales.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}}
*Employee-comparison methods: rather than subordinates being judged against pre-established criteria, they are compared with one another. This method eliminates central tendency and leniency errors but still allows for halo effect errors to occur.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} 
**The rank-order method has raters ranking subordinates from "best" to "worst", but how truly good or bad one is on a performance dimension would be unknown.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} 
**The [[Pairwise comparison (psychology)|paired-comparison]] method requires the rater to select the two "best" subordinates out of a group on each dimension then rank individuals according to the number of times each subordinate was selected as one of the "best".{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} 
**The forced-distribution method is good for large groups of ratees. The raters evaluate each subordinate on one or more dimensions and then place (or "force-fit") each subordinate in a 5 to 7 category [[normal distribution]].{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} 
**The method of top-grading can be applied to the forced distribution method.{{sfn|Smart|1999|p={{page needed|date=September 2024}}}} This method identifies the 10% lowest performing subordinates, as according to the forced distribution, and dismisses them leaving the 90% higher performing subordinates.
*Behavioral checklists and scales: 
**The [[critical incident technique]] concerns "specific behaviors indicative of good or bad job performance".{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} Supervisors record behaviors of what they judge to be job performance relevant, and they keep a running tally of good and bad behaviors.  A discussion on performance may then follow. 
**The [[behaviorally anchored rating scales]] (BARS) combine the critical incidents method with rating scale methods by rating performance on a scale but with the scale points being anchored by behavioral incidents.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} Note that BARS are job specific. 
**In the '''behavioral observation scale (BOS)''' approach to performance appraisal, employees are also evaluated in the terms of critical incidents. In that respect, it is similar to BARS. However, the BOS appraisal rate subordinates on the ''frequency'' of the critical incidents as they are observed to occur over a given period. The ratings are assigned on a five-point scale. The behavioral incidents for the rating scale are developed in the same way as for BARS through identification by supervisors or other subject matter experts. Similarly, BOS techniques meet equal employment opportunity because they are related to actual behavior required for successful job performance.<ref name="Fletcher">{{cite journal |last1=Fletcher |first1=Clive |date=November 2001 |title=Performance appraisal and management: The developing research agenda |journal=Journal of Occupational and Organizational Psychology |volume=74 |issue=4 |pages=473–487 |doi=10.1348/096317901167488}}</ref>

====Stakeholders====
So-called 360-degree feedback methods survey the customers, supervisors, and peers of employees being appraised so as to provide a more comprehensive evaluation of the employee and to potentially increase team performance and culture.<ref>{{cite journal |last1=González-Gil |first1=M.T. |last2=Parro-Moreno |first2=A.I. |last3=Oter-Quintana |first3=C. |last4=González-Blázquez |first4=C. |last5=Martínez-Marcos |first5=M. |last6=Casillas-Santana |first6=M. |last7=Arlandis-Casanova |first7=A. |last8=Canalejas-Pérez |first8=C. |date=December 2020 |title=360-Degree evaluation: Towards a comprehensive, integrated assessment of performance on clinical placement in nursing degrees: A descriptive observational study |journal=Nurse Education Today |volume=95 |article-number=104594 |doi=10.1016/j.nedt.2020.104594 |pmid=32979748}}</ref><ref name="Meghdad et al 2020 Assessment of the performance">{{cite journal |last1=Meghdad |first1=Rahati |last2=Nayereh |first2=Rohollahi |last3=Zahra |first3=Sakeni |last4=Houriye |first4=Zahed |last5=Reza |first5=Nanakar |date=January 2020 |title=Assessment of the performance of nurses based on the 360-degree model and fuzzy multi-criteria decision-making method (FMCDM) and selecting qualified nurses |journal=Heliyon |volume=6 |issue=1 |article-number=e03257 |bibcode=2020Heliy...603257M |doi=10.1016/j.heliyon.2020.e03257 |pmc=7002825 |pmid=32042978 |doi-access=free}}</ref><ref name="ReferenceA" /> Research has shown that the source of the feedback (either manager or peer) does not matter in influencing employees' subsequent behaviors after the feedback is received.<ref>{{cite journal |last1=Eva |first1=Nathan |last2=Meacham |first2=Hannah |last3=Newman |first3=Alexander |last4=Schwarz |first4=Gary |last5=Tham |first5=Tse Leng |date=July 2019 |title=Is coworker feedback more important than supervisor feedback for increasing innovative behavior? |url=https://eprints.soas.ac.uk/30420/3/Eva%20Is%20CoWorker%20Feedback%20More%20Important%20than%20Supervisor%20Feedback.pdf |journal=Human Resource Management |volume=58 |issue=4 |pages=383–396 |doi=10.1002/hrm.21960}}</ref><ref>{{cite journal |last1=Eva |first1=Nathan |last2=Meacham |first2=Hannah |last3=Schwarz |first3=Gary |date=August 2018 |title=Is Co-Worker Feedback More Important than Supervisor Feedback for Increasing Extra-Role Behaviors? |journal=Academy of Management Proceedings |volume=2018 |issue=1 |page=11942 |doi=10.5465/AMBPP.2018.11942abstract}}</ref> Threats to both the quality and perception of feedback in peer assessment include peers being biased by pre-existing relationships and employees putting in less trust in the appraisal of a peer than a supervisor.<ref name=":12">{{cite book |last1=Iriani |first1=Tuti |title=Proceedings of the 3rd International Conference on Education and Technology (ICETECH 2022) |last2=Anisah |last3=Luthfiana |first3=Yusrina |date=2023 |isbn=978-2-38476-055-8 |series=Advances in Social Science, Education and Humanities Research |volume=745 |pages=216–224 |chapter=Peer Assessment Analysis of Performance Appraisal Using Analytical Rubrics to Improve Critical Thinking Skills |doi=10.2991/978-2-38476-056-5_24}}</ref><ref>{{cite journal |last1=Murphy |first1=Kevin R. |date=January 2020 |title=Performance evaluation will not die, but it should |journal=Human Resource Management Journal |volume=30 |issue=1 |pages=13–31 |doi=10.1111/1748-8583.12259}}</ref> Additionally in an organization where peer assessment is undertaken, employees may have concern for how the analysis of other is perceived, and how this may impact their own assessment in turn.<ref>{{cite journal |last1=Klapper |first1=Helge |last2=Piezunka |first2=Henning |last3=Dahlander |first3=Linus |date=July 2024 |title=Peer Evaluations: Evaluating and Being Evaluated |journal=Organization Science |volume=35 |issue=4 |pages=1363–1387 |doi=10.1287/orsc.2021.15302}}</ref>

Ratings may be influenced and inflated by many non-performance factors such as employee 'likeability', personal prejudices, ease of management, and previous mistakes or successes.<ref name="Lin Kellough 2019 Performance Appraisal Problems" /> [[Marcus Buckingham]] and Ashley Goodall, writing in ''Harvard Business Review'', argue, contrary to the assumptions underlying performance rating, the rating mainly measured the unique rating tendencies of the rater and thus reveals more about the rater than about the person who is rated. They referred to this as the ''idiosyncratic rater effect''.<ref>{{cite journal |last1=Buckingham |first1=Marcus |last2=Goodall |first2=Ashley |date=2015 |title=Reinventing performance management |url=https://hbr.org/2015/04/reinventing-performance-management |journal=Harvard Business Review |volume=93 |issue=4 |page=15}}</ref> Supervisors will sometimes rate employees more favorably than that of their true performance in order to please the employees and avoid conflict.<ref name="Schraeder" /><ref name="Martin">{{cite journal |last1=Martin |first1=David C. |last2=Bartol |first2=Kathryn M. |date=June 1998 |title=Performance Appraisal: Maintaining System Effectiveness |journal=Public Personnel Management |volume=27 |issue=2 |pages=223–230 |doi=10.1177/009102609802700208}}</ref>

Performance appraisals may also involve self assessment.<ref>{{cite journal |last1=Panadero |first1=Ernesto |last2=Brown |first2=Gavin T. L. |last3=Strijbos |first3=Jan-Willem |date=December 2016 |title=The Future of Student Self-Assessment: a Review of Known Unknowns and Potential Directions |journal=Educational Psychology Review |volume=28 |issue=4 |pages=803–830 |doi=10.1007/s10648-015-9350-2 |hdl=10486/679161 |hdl-access=free}}</ref> Threats to successful implementation of self-assessment are scarcity of time, overemphasis on scoring tools, failure to follow-up improvement actions and lack of communication.<ref>{{cite journal |last1=Teo |first1=W F |last2=Dale |first2=B G |date=May 1997 |title=Self-assessment: Methods, management and process |journal=Proceedings of the Institution of Mechanical Engineers, Part B: Journal of Engineering Manufacture |volume=211 |issue=5 |pages=365–375 |doi=10.1243/0954405971516347}}</ref><ref>{{cite journal |last1=McDonald |first1=Betty |date=January 2008 |title=Self Assessment for Understanding |journal=Journal of Education |volume=188 |issue=1 |pages=25–40 |doi=10.1177/002205740818800103}}</ref> The risk of flawed self-assessment is that self-perceptions of behaviours, knowledge and skill can fail to align with the reality of an individual's performance. This can either absorb excessive management time in addressing flawed self-perceptions of performance or, if the behaviour is not addressed, can detract from the achievement of organisational goals. Therefore, evolved reflective skills are essential to successful self-assessment.<ref>{{cite journal |last1=Dunning |first1=David |last2=Heath |first2=Chip |last3=Suls |first3=Jerry M. |date=December 2004 |title=Flawed Self-Assessment: Implications for Health, Education, and the Workplace |journal=Psychological Science in the Public Interest |volume=5 |issue=3 |pages=69–106 |doi=10.1111/j.1529-1006.2004.00018.x |pmid=26158995}}</ref>

According to a meta-analysis of 27 field studies, general employee participation in their own appraisal process was positively correlated with employee reactions to the performance appraisals ystem.<ref name="Cawley" /> More specifically, employee participation in the appraisal process was most strongly related to employee satisfaction with the performance appraisal system.<ref name="Cawley" /> Concerning the reliability of employee reaction measures, researchers have found employee reaction scales to be sound with few concerns through using a confirmatory factor analysis that is representative of employee reaction scales.<ref name="Keeping">{{cite journal |last1=Keeping |first1=Lisa M. |last2=Levy |first2=Paul E. |date=October 2000 |title=Performance appraisal reactions: Measurement, modeling, and method bias. |journal=Journal of Applied Psychology |volume=85 |issue=5 |pages=708–723 |doi=10.1037/0021-9010.85.5.708 |pmid=11055144}}</ref>

==== Frequency ====
Some propose that the purpose of performance appraisals and the frequency of their feedback are contingent upon the nature of the job and characteristics of the employee.<ref name="Cummings">{{cite journal |last1=Cummings |first1=L. L. |last2=Schwab |first2=Donald P. |date=July 1978 |title=Designing Appraisal Systems for Information Yield |journal=California Management Review |volume=20 |issue=4 |pages=18–25 |doi=10.2307/41164777 |jstor=41164777}}</ref> For example, employees of routine jobs where performance maintenance is the goal would benefit sufficiently from annual performance appraisalfeedback. On the other hand, employees of more discretionary and non-routine jobs, where goal-setting is appropriate and there is room for development, would benefit from more frequent performance appraisal feedback. Informal performance appraisals may be done more often, to prevent the element of surprise from the formal appraisal.<ref name="Cederblom" /><ref name="Cummings" /><ref>{{cite journal |last1=Katz |first1=Ralph |date=2013 |title=Motivating technical professionals today |journal=IEEE Engineering Management Review |volume=41 |issue=1 |pages=28–38 |doi=10.1109/EMR.2013.6489837}}</ref> To improve the effectiveness and value of the performance appraisal process, many organizations have adopted a continuous performance management practice. This takes the form of regular – weekly or monthly – manager-employee check-ins and informal performance discussions.<ref>{{Citation |last=Traynor |first=Susan |title=Continuous Performance Management |date=2021 |work=SAP SuccessFactors Talent: Volume 1: A Complete Guide to Configuration, Administration, and Best Practices: Performance and Goals |pages=613–643 |editor-last=Traynor |editor-first=Susan |place=Berkeley, CA |publisher=Apress |language=en |doi=10.1007/978-1-4842-6600-7_13 |isbn=978-1-4842-6600-7 |last2=Wellens |first2=Michael A. |last3=Krishnamoorthy |first3=Venki |editor2-last=Wellens |editor2-first=Michael A. |editor3-last=Krishnamoorthy |editor3-first=Venki}}</ref>

==== Interview ====
The performance appraisal interview is typically the final step of the appraisal process.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} The interview is held between the subordinate and supervisor. The performance appraisal interview can be considered of great significance to an organization's performance appraisal system.<ref name="Cederblom" /> It is most advantageous when both the superior and subordinate participate in the interview discussion and establish goals together.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} Three factors consistently contribute to effective performance appraisal interviews: the supervisor's knowledge of the subordinate's job and performance in it, the supervisor's support of the subordinate, and a welcoming of the subordinate's participation.<ref name="Cederblom" />

=== Technology ===
Computers have been playing an increasing role in performance appraisal for some time,<ref>{{cite journal |last1=Sulsky |first1=Lorne M. |last2=Keown |first2=Janine L. |date=February 1998 |title=Performance appraisal in the changing world of work: Implications for the meaning and measurement of work performance. |journal=Canadian Psychology / Psychologie Canadienne |volume=39 |issue=1–2 |pages=52–59 |doi=10.1037/h0086794 |id={{ProQuest|614336993}}}}</ref> through electronic monitoring of performance, which affords the ability to record a huge amount of data on multiple dimensions of work performance,<ref>{{cite journal |last1=Stanton |first1=Jeffrey M. |date=January 2000 |title=Reactions to Employee Performance Monitoring: Framework, Review, and Research Directions |journal=Human Performance |volume=13 |issue=1 |pages=85–113 |doi=10.1207/s15327043hup1301_4}}</ref> and the recording and aggregating performance ratings and written observations and making the information available on-line.<ref name="Fletcher" />

=== Challenges ===
Lack of support from higher management can undermine raters' confidence and their ability to conduct employee performance appraisal effectively, which can compromise the independence and integrity of performance appraisal decision-making.<ref name="Lin Kellough 2019 Performance Appraisal Problems" /> Employees often rely on higher management to validate the organization's decisions.<ref name="Lin Kellough 2019 Performance Appraisal Problems" /> When higher management emphasizes the importance of performance appraisals by providing endorsements, resources, training, and time for participation, it can motivate raters to be more accountable and thorough in conducting accurate appraisals.<ref name="Park 2014 Motivation of Public Managers">{{cite journal |last1=Park |first1=Seejeen |date=December 2014 |title=Motivation of Public Managers as Raters in Performance Appraisal: Developing a Model of Rater Motivation |journal=Public Personnel Management |volume=43 |issue=4 |pages=387–414 |doi=10.1177/0091026014530675}}</ref> However, political and institutional factors, such as, political ideologies, norms, and organizational culture can influence the effective implementation of performance appraisal outcomes.<ref name="Wang et al 2019 Contextualizing performance">{{cite journal |last1=Wang |first1=Meng |last2=Zhu |first2=Cherrie Jiuhua |last3=Mayson |first3=Susan |last4=Chen |first4=Weizhen |date=9 March 2019 |title=Contextualizing performance appraisal practices in Chinese public sector organizations: the importance of context and areas for future study |journal=The International Journal of Human Resource Management |volume=30 |issue=5 |pages=902–919 |doi=10.1080/09585192.2017.1292537}}</ref>

== Efficacy ==
There is a general consensus in academic scholarship that performance appraisals lead to positive implications for organizations,<ref name="Schraeder" /><ref name="Pettijohn">{{cite journal |last1=Pettijohn |first1=Linda S. |last2=Stephen Parker |first2=R. |last3=Pettijohn |first3=Charles E. |last4=Kent |first4=John L. |date=November 2001 |title=Performance appraisals: usage, criteria and observations |journal=Journal of Management Development |volume=20 |issue=9 |pages=754–771 |doi=10.1108/EUM0000000006159}}</ref> including improving organisational effectiveness and employee productivity,<ref name="Jenks">{{cite journal |last1=Jenks |first1=James M. |date=June 1991 |title=Do your performance appraisals boost productivity? |journal=Management Review |volume=80 |issue=6 |pages=45–48 |id={{Gale|A10830893}} {{ProQuest|206694339}}}}</ref><ref name="Spinks">{{cite journal |last1=Spinks |first1=Nelda |last2=Wells |first2=Barron |last3=Meche |first3=Melanie |date=April 1999 |title=Appraising the appraisals: computerized performance appraisal systems |journal=Career Development International |volume=4 |issue=2 |pages=94–100 |doi=10.1108/13620439910254713}}</ref> indicating identifying employee competencies,<ref name="Broady" /> projecting future job performance.<ref>{{cite journal |last1=Wang, H., Hom, P. W., & Allen, D. G. |title=Coping with turnover: New directions for research on employee retention |journal=Academy of Management Annals |date=2021 |pages=13(1), 69–103}}</ref> At the same time, a [[Scientist–practitioner model|scientist-practitioner gap]] has been noted between the academic consensus and the experiences of industry practitioners.<ref name="Keeping" /> Feedback from performance appraisals may aid in minimizing employees' [[perception]]s of uncertainty and promote trust within an organization.<ref name="Schraeder" /><ref name="Spinks" /><ref name="Mayer">{{cite journal |last1=Mayer |first1=Roger C. |last2=Gavin |first2=Mark B. |date=October 2005 |title=Trust in Management and Performance: Who Minds the Shop While the Employees Watch the Boss? |journal=Academy of Management Journal |volume=48 |issue=5 |pages=874–888 |doi=10.5465/amj.2005.18803928}}</ref><ref name="Kanfer">{{cite journal |last1=Kanfer |first1=Ruth |last2=Ackerman |first2=Phillip L. |date=August 1989 |title=Motivation and cognitive abilities: An integrative/aptitude-treatment interaction approach to skill acquisition. |journal=Journal of Applied Psychology |volume=74 |issue=4 |pages=657–690 |doi=10.1037/0021-9010.74.4.657 |id={{ProQuest|614301202}}}}</ref> Research has found that face-to-face discussions and continuous feedback help improve the performance appraisal process by enhancing clarity and mutual understanding.<ref>{{cite journal |last1=Barbieri, D., Gorbatai, A., & Kazman, R. |title=The Performance of Performance Appraisal Systems: A Theoretical Framework for Public Organizations |journal=Review of Public Personnel Administration}}</ref> Research has found that clear communication of performance metrics, management support, and fair reward distribution are essential for successful reward implementation.<ref>{{cite journal |last1=Audenaert, M., Vanderstraeten, A., & Buyens, D. |title=The Role of Feedback Quality and Organizational Cynicism for Affective Commitment Through Leader–Member Exchange |journal=Review of Public Personnel Administration |date=2021 |pages=41(3), 593–615}}</ref>

===Criticism===
It has been proposed that the use of performance appraisal systems in organizations adversely affects organizations' pursuits of quality performance.<ref name="Soltani">{{cite journal |last1=Soltani |first1=Ebrahim |date=October 2005 |title=Conflict between theory and practice: TQM and performance appraisal |journal=International Journal of Quality & Reliability Management |volume=22 |issue=8 |pages=796–818 |doi=10.1108/02656710510617238}}</ref> It is believed by some scholars and practitioners that the use of performance appraisals is unnecessary if there is [[total quality management]].<ref name="Kikoski" /> Employees also often have negative perceptions of performance reviews,<ref name="Pettijohn" /><ref name="Sudarsan" /> as they can be uncomfortable, stressful, or formative of distrust in the workspace.{{sfn|Schultz|Schultz|2010|pp=108–109}}<ref name="Jenks" /><ref name="Spinks" /> If the person being appraised does not trust their employer, such exercises may be of no benefit.<ref>{{cite journal |last1=McGivern |first1=Gerry |last2=Ferlie |first2=Ewan |date=September 2007 |title=Playing tick-box games: Interrelating defences in professional appraisal |journal=Human Relations |volume=60 |issue=9 |pages=1361–1385 |doi=10.1177/0018726707082851}}</ref> Negative outcomes concerning the organizations can result when goals are overly challenging or overemphasized to the extent of affecting ethics, legal requirements, or quality.<ref name="Schweitzer">{{cite journal |last1=Schweitzer |first1=Maurice E. |last2=Ordóñez |first2=Lisa |last3=Douma |first3=Bambi |date=2004 |title=Goal Setting as a Motivator of Unethical Behavior |journal=The Academy of Management Journal |volume=47 |issue=3 |pages=422–432 |jstor=20159591}}</ref> Moreover, challenging performance goals can impede an employee's abilities to acquire necessary knowledge and skills.<ref name="Kanfer" /> The skepticism is also reflected in the decline in the use of traditional performance appraisal processes in the U.S. corporate sector.<ref name="Cappelli Tavis 2016 The performance management revolution" /> It is estimate of a third of the U.S. private companies have now switched to a more informal and frequent engagement between managers and employees to enhance performance.<ref name="Cappelli Tavis 2016 The performance management revolution" /> The shift is attributed to a greater focus on talent development, business agility, and a preference for teamwork over individual responsibility.<ref name="Cappelli Tavis 2016 The performance management revolution" />

Academic literature has also been unable to appropriately define exclusive measures of performance appraisal effectiveness.<ref name="Barbieri et al 2023 Performance of Performance Appraisal Systems">{{cite journal |last1=Barbieri |first1=Marta |last2=Micacchi |first2=Lorenza |last3=Vidè |first3=Francesco |last4=Valotti |first4=Giovanni |title=The Performance of Performance Appraisal Systems: A Theoretical Framework for Public Organizations |journal=Review of Public Personnel Administration |date=March 2023 |volume=43 |issue=1 |pages=104–129 |doi=10.1177/0734371X211043560 }}</ref> Flawed performance standards or measures are attributed to the use of subjective criteria or ambiguous measures by raters during performance appraisals, due to the difficulty in defining objective performance standards due to the complexity and diversity of job tasks and outcomes.<ref name="Lin Kellough 2019 Performance Appraisal Problems" /><ref name="Bayo-Moriones et al 2020 Performance appraisal">{{cite journal |last1=Bayo-Moriones |first1=Alberto |last2=Galdon-Sanchez |first2=Jose E. |last3=Martinez-de-Morentin |first3=Sara |date=21 August 2020 |title=Performance appraisal: dimensions and determinants |url=http://www2.unavarra.es/gesadj/depEconomia/repec/DocumentosTrab/DT1207.PDF |journal=The International Journal of Human Resource Management |volume=31 |issue=15 |pages=1984–2015 |doi=10.1080/09585192.2018.1500387}}</ref> Empirical findings suggest that subordinates with a high degree of job autonomy may have a positive relationship with the inclusion of subjective measures in their performance appraisals, due to the variation of day-to-day job tasks need to meet performance targets.<ref name="Bayo-Moriones et al 2020 Performance appraisal" />

Studies also suggest cognitive biases and [[Dual process theory|dual-process theory]] errors, as well as motivation and personal relationships, play a substantive role in influencing ratings.<ref name="Wang et al 2019 Contextualizing performance" /><ref name="Sanner et al 2022 Do Desperate Times">{{cite journal |last1=Sanner |first1=Bret |last2=Evans |first2=Karoline |last3=Fernandez |first3=Delia |date=8 August 2022 |title=Do Desperate Times Call for Desperate Measures? The Effect of Crises on Performance Appraisals |journal=Human Performance |volume=35 |issue=3–4 |pages=218–240 |doi=10.1080/08959285.2022.2108034}}</ref><ref name="Park 2014 Motivation of Public Managers" /><ref name="Sudarsan" /> In the 2005 Merit Performance Survey conducted by the United States (U.S.) [[United States Merit Systems Protection Board|Merit Systems Protection Board]] (MSPB), 16.41% of federal supervisors reported that they had rated their employees' performance appraisals either higher or lower than the employees should have received.<ref name="Lin Kellough 2019 Performance Appraisal Problems">{{cite journal |last1=Lin |first1=Yu-Chun |last2=Kellough |first2=J. Edward |title=Performance Appraisal Problems in the Public Sector: Examining Supervisors' Perceptions |journal=Public Personnel Management |date=June 2019 |volume=48 |issue=2 |pages=179–202 |doi=10.1177/0091026018801045 }}</ref> Among nine potential problems identified in the 2005 MPS on structure and operation of the U.S. federal government appraisal system; inflated ratings, flawed standards, and lack of support were ranked as the top three problems, respectively.<ref name="Lin Kellough 2019 Performance Appraisal Problems" /> Research shows that managers tend to give better ratings to subordinates they favor, influenced by both direct bias and indirect bias.<ref>{{cite journal |last1=Davis |first1=Paul J. |title=Seven biggest problems with performance appraisals: and seven development approaches to rectify them |journal=Development and Learning in Organizations|date=30 December 2011 |volume=26 |issue=1 |pages=11–14 |doi=10.1108/14777281211189119 }}</ref> Inflated ratings are more common when performance appraisals are conducted for judgmental and administrative purposes, such as promotions, pay increases, or job retention, rather than for developmental reasons.<ref name="Lin Kellough 2019 Performance Appraisal Problems"/>

Government departments and public service organizations often face challenges in developing clear organizational goals, which makes it further challenging for managers evaluate the performance of subordinates based on individual performance goals that are not clearly aligned to organizational goals.<ref name="Barbieri et al 2023 Performance of Performance Appraisal Systems" />

==Legal implications==

When performance appraisals are not carried out appropriately, legal issues could result that place the organization at risk.<ref name="Jenks" /> Performance appraisals are used in organizational disciplinary programs<ref name="Spinks" /> as well as for promotional decisions within the organization.<ref name="Schraeder" /> The improper application and utilization of performance appraisals can affect employees negatively and lead to legal action against the organization.

There are [[federal law]]s addressing fair employment practices, and this also concerns performance appraisal. [[Discrimination]] can occur within predictions of performance and evaluations of job behaviors.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} The revision of many court cases has revealed the involvement of alleged discrimination which was often linked to the assessment of the employee's job performance.<ref name="Malos">{{cite book |last1=Malos |first1=S. B. |chapter=Current legal issues in performance appraisal |pages=49–94 |editor1-last=Smither |editor1-first=James W. |title=Performance Appraisal: State of the Art in Practice |date=1998 |publisher=Wiley |isbn=978-0-7879-0945-1 }}</ref>  Some of the laws which protect individuals against discrimination include [[Civil Rights Act of 1964|Title VII of the Civil Rights Act of 1964]], the [[Civil Rights Act of 1991]], the [[Age Discrimination in Employment Act]] (ADEA), and the [[Americans with Disabilities Act of 1990|Americans with Disabilities Act]] (ADA).{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} Lawsuits may also result from charges of an employer's negligence, defamation, or misrepresentation.{{sfn|Howes|Muchinsky|2022|p={{page needed|date=September 2024}}}} Appraisal criteria for legally sound performance appraisals include appraisal that is objective, job-related, behavior-based, within the control of the ratee, and related to specific functions rather than a global assessment.<ref name="Malos" /> Some appraisal procedure suggestions for a legally sound performance appraisals to standardize operations, communicate formally with employees, provide information of performance deficits and give opportunities to employees to correct those deficits, give employees access to appraisal results, provide written instructions for the training of raters, and use multiple, diverse and unbiased raters.<ref name="Malos" />

The Employment Opportunity Commission (EEOC) guidelines apply to any selection procedure that is used for making employment decisions, not only for hiring, but also for promotion, demotion, transfer, layoff, discharge, or early retirement. Therefore, employment appraisal procedures must be validated like tests or any other selection device. Employers who base their personnel decisions on the results of a well-designed performance review program that includes formal appraisal interviews are much more likely to be successful in defending themselves against claims of discrimination.{{sfn|Schultz|Schultz|2010|p=129}}

==Cross-cultural implications==

Performance appraisal (PA) systems, and the premises of which they were based, that have been formed and regarded as effective in the United States may not have the transferability for effectual utilization in other countries or [[culture]]s, and vice versa.{{sfn|Hofstede|2001|p={{page needed|date=September 2024}}}} Performance "appraisal is thought to be deeply rooted in the [[Norm (social)|norms]], values, and beliefs of a [[society]]".<ref name="Seddon">{{cite journal |last1=Seddon |first1=John |title=Assumptions, Culture and Performance Appraisal |journal=Journal of Management Development |date=March 1987 |volume=6 |issue=3 |pages=47–54 |doi=10.1108/eb051645 }}</ref> "Appraisal reflects attitudes towards motivation and performance (self) and relationships (e.g. peers, subordinates, supervisors, organization), all of which vary from one country to the next".<ref name="Chiang">{{cite journal |last1=Chiang |first1=Flora F. T. |last2=Birtch |first2=Thomas A. |title=Appraising Performance across Borders: An Empirical Examination of the Purposes and Practices of Performance Appraisal in a Multi-Country Context |journal=Journal of Management Studies |date=November 2010 |volume=47 |issue=7 |pages=1365–1393 |doi=10.1111/j.1467-6486.2010.00937.x }}</ref> Therefore, appraisal should be in conjunction with cultural norms, values, and beliefs in order to be operative.<ref name="Sparrow">{{cite journal |last1=Sparrow |first1=Paul |last2=Schuler |first2=Randall S. |last3=Jackson |first3=Susan E. |title=Convergence or divergence: human resource practices and policies for competitive advantage worldwide |journal=The International Journal of Human Resource Management |date=May 1994 |volume=5 |issue=2 |pages=267–299 |doi=10.1080/09585199400000019 }}</ref> The deep-seated norms, values and beliefs in different cultures affect employee motivation and perception of organizational equity and justice. In effect, a performance appraisal system created and considered effectual in one country may not be an appropriate assessment in another cultural region.<ref name="Chiang"/>

For example, some countries and cultures value the trait of assertiveness and personal accomplishment while others instead place more merit on cooperation and interpersonal connection. Countries scoring high on assertiveness consider performance appraisalto be a way of assuring equity among employees so that higher performing employees receive greater rewards or higher salaries.<ref name="Chiang"/> Countries scoring low on assertiveness but higher in interpersonal relations may not like the social separation and pay inequity of higher/lower performing employees; employees from this more cooperative rather than individualistic culture place more concern on interpersonal relationships with other employees rather than on individual interests.<ref name="Chiang"/> High assertive countries value performance feedback for self-management and effectiveness purposes while countries low in assertiveness view performance feedback as "threatening and obtrusive".<ref name="Chiang"/><ref name="Sully">{{cite journal |last1=Sully De Luque |first1=Mary F. |last2=Sommer |first2=Steven M. |title=The Impact of Culture on Feedback-Seeking Behavior: An Integrated Model and Propositions |journal=Academy of Management Review |date=October 2000 |volume=25 |issue=4 |pages=829–849 |doi=10.5465/amr.2000.3707736 }}</ref> In this case, the performance appraisalof the high assertive countries would likely not be beneficial for countries scoring lower in assertiveness to employ. However, countries scoring lower in assertiveness could employ performance appraisalfor purposes of improving long-term communication development within the organization such as clarifying job objectives, guide training and development plans, and lessen the gap between job performance and organizational expectations.{{sfn|Cardy|Dobbins|1994|p={{page needed|date=September 2024}}}}

==See also==
{{cmn|colwidth=30em|
* [[Behavioral risk management]]
* [[Employee motivation]]
* [[Employment integrity testing]]
* [[Employment law]]
* [[Human resource development]]
* [[Human resource management]]
* [[Industrial and organizational psychology]]
* [[Industrial sociology]]
* [[Job analysis]]
* [[Job satisfaction]]
* [[Organizational commitment]]
* [[Organizational socialization]]
* [[Performance paradox]]
* [[Performance rating (work measurement)]]
* [[Personnel psychology]] 
* [[Personnel selection]]
* [[Quality of working life]]
* [[Realistic job preview]]
* [[Systems psychology]]
* [[Work motivation]]
}}

==Notes==
{{notelist}}

==References==
{{Reflist|40em}}

==Sources==
* {{cite book |last1=Cardy |first1=Robert L. |last2=Dobbins |first2=Gregory H. |title=Performance Appraisal: Alternative Perspectives |date=1994 |publisher=South-Western Publishing Company |isbn=978-0-538-81383-9 }}
* {{cite book |last1=Gomez-Mejia |first1=Luis R. |last2=Balkin |first2=David |last3=Cardy |first3=Robert |title=Managing Human Resources |date=2011 |publisher=Pearson Higher Ed |isbn=978-0-13-299823-9 }}
* {{cite book |last1=Grote |first1=Richard C. |title=The Performance Appraisal Question and Answer Book: A Survival Guide for Managers |date=2002 |publisher=American Management Association |isbn=978-0-8144-2669-2 }}
* {{cite book |last1=Hofstede |first1=Geert |title=Culture's Consequences: Comparing Values, Behaviors, Institutions and Organizations Across Nations |date=2001 |publisher=SAGE |isbn=978-0-8039-7324-4 }}
* {{cite book |last1=Howes |first1=Satoris S. |last2=Muchinsky |first2=Paul M. |title=Psychology Applied to Work: An Introduction to Industrial and Organizational Psychology |date=2022 |publisher=Hypergraphic Press, Incorporated |isbn=978-0-9749345-5-6 }}
* {{cite book |last1=Mathis |first1=Robert L. |last2=Jackson |first2=John Harold |title=Human Resource Management |date=2003 |publisher=Thomson/South-western |isbn=978-0-324-07151-1 }}
* {{cite book |last1=Schultz |first1=Duane P. |last2=Schultz |first2=Sydney Ellen |title=Psychology and Work Today: An Introduction to Industrial and Organizational Psychology |date=2010 |publisher=Prentice Hall |isbn=978-0-205-68358-1 }}
* {{cite book |last1=Smart |first1=Bradford D. |title=Topgrading: How Leading Companies Win by Hiring, Coaching, and Keeping the Best People |date=1999 |publisher=Prentice Hall Press |isbn=978-0-7352-0049-4 }}

{{Employment}}
{{Workplace}}

{{DEFAULTSORT:Performance Appraisal}}
[[Category:Job evaluation]]
[[Category:Personal development]]
[[Category:Industrial and organizational psychology]]
[[Category:Workplace]]