How to Conduct an Effective Performance Appraisal

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Published October 13th, 2020

What are performance appraisals?

Performance appraisals are primarily used to improve an employee’s performance. It can also be used to justify an employee’s compensation and their potential for promotion. An effective employee performance appraisal process can drive performance, reduce dissatisfaction, identify training opportunities and boost company culture. Appraisals are typically conducted with a performance appraisal form.

Similarly, a poorly executed performance appraisal process can lead to negative outcomes such as employee disengagement, office politics and poor company culture.

This article covers the following:

Top 5 Reasons why Employees Hate Performance Appraisals

“One in four employees dreads their performance reviews more than anything in their entire working lives,” according to Douglas Stone and Sheila Heen, authors of “Thanks for the Feedback.” This is a sentiment shared by managers.

Most managers, supervisors, and HR practitioners are still struggling to deliver effective performance appraisals. In a survey targeting employees, only 55% of respondents believe that performance appraisals have a positive impact on their organization. Despite the negative feedback, in a separate survey only 30% of respondents said that their organizations made changes to their performance management system in the last three years.

Here are some common reasons why employees may consider performance appraisals ineffective:

  1. No input from employee – Employees don’t feel like their opinions and suggestions are being valued since their manager does most, if not all of the talking.
  2. Does not assess actual performance – Evaluations often end up focusing on an employee’s personal traits even if they do not necessarily have a negative impact on their work, instead of their actual contributions and productivity.
  3. Can be highly subjective – Results rely too heavily on the personal bias of their manager. Factors such as the manager’s mood and personal preference affect the results of what is supposed to be an objective evaluation.
  4. Managers are not prepared – Some companies have employees working on a different shift from their managers. As a result, employees feel that their managers have not observed them enough to provide an accurate assessment of their performance.
  5. Too infrequent – Since most companies conduct performance appraisals only once or twice a year with no catch-up sessions in between, employees are only informed of their performance status during the actual appraisal. This can lead to anxiety and defensiveness on the employee’s part.
    To address these employee concerns it is vital to prepare a well executed performance appraisal process.

5 Effective Tips on Conducting a Performance Appraisal

Here are 5 tips a manager, supervisor or HR professional can use to conduct an effective performance appraisal:

  1. Prepare – ensure you are well prepared by:
    • reviewing the notes from the employee’s previous appraisals – You can start by getting a “snapshot” of the employee’s general status and progress by reviewing their last appraisal before comparing it to their more recent works
    • reviewing their more recent works – Most employee evaluations are scheduled on an annual or biannual basis, which means their recent works and activity have not been reviewed. Review an employee’s recent works and compare them to
    • providing live feedback – Provide on-the-spot positive, and negative feedback instead of waiting for the scheduled appraisal. This shows the employee that you are actually paying attention to their work which will encourage them to be more open and honest during your actual appraisal
  2. Make it conversational – Having a conversation instead of “lecturing” an employee during a performance appraisal is important because employees are compelled to be open and honest when they feel that they are listened to. Involving the employee in the process encourages engagement and a better understanding of the purpose of the performance appraisal.
  3. Customize action plans – Action plans must be customized according to each employee’s strengths, weaknesses, target metrics, and personal goals as a member of the organization to be effective. A good action plan must be logical, doable, and directly linked to goals.
  4. Set effective and realistic goals – An effective and realistic goal should be aligned with the company’s objective, have a time-frame for completion, and an expected output.Employees are more enthusiastic and work harder to meet their individual goals when they understand how it impacts the company’s broader success. Factors such as the nature of the task, the employee’s capabilities, and the tools and support provided such as training and supervisor assistance should all be considered when setting effective and realistic goals.
  5. Proper documentation – Properly documenting what was discussed during a performance appraisal is essential for practical and procedural purposes. Proper documentation provides you with easy access to employee appraisals should you need to access them. It’s also a common requirement to have employees sign their performance appraisal form as acknowledgement. Using an performance appraisal form can help streamline your performance appraisal process.

What is iAuditor and how can I use it for Performance Appraisals?

iAuditor is the world’s #1 digital form application and can help streamline your performance appraisal process. Conduct performance appraisals using your phone or tablet, keep important notes, and assign follow-up actions in real-time. Generate reports instantly on your hand-held device and easily access them online. Get rid of paperwork so you can focus on conducting effective performance appraisals.

To get you started, we have created these free performance appraisal forms you can download, use, and customize for your purpose.

  • Perform paperless performance appraisals on your hand-held device
  • Instantly generate a performance appraisal report to be shared with your employee and management personnel
  • Capture electronic signatures
  • Take advantage of unlimited, cloud-based storage for all of your appraisal reports.

To get you started, we have created these free employee evaluation forms you can download, use, and customize for your purpose.


Juhlian Pimping

SafetyCulture Staff Writer

Juhlian Pimping has been writing about safety and quality topics for SafetyCulture since 2018. Before writing for SafetyCulture full-time, Juhlian worked in customer service and wrote for an Australian RTO.