Benefits of Performance Appraisal

An effective performance appraisal system can be of benefit to three parties they are for organization, for appraiser and for appraisee.
1)    For the Organizations:
Following are the benefits of an organization.
Þ   It leads to better performance throughout the organization, due to successful communication of the objectives and values of the organizations, sense of being close to the organization, loyalty and improved relationships between managers and staff.
Þ   Overall improvement in the duties performed by each employee of the organization.
Þ   Due to performance appraisal of employee new ideas for improvement in their work is generated.
Þ   Long-term plans can be generated.
Þ   The need for training and development can be identified more clearly.
Þ   A traditions of nonstop improvement and success in the organization can be formed and maintained.
Þ   Career development plans can be chalked out for capable employee to enhance their performance in future.
2)    For the appraiser:
 Following are the benefits to the appraiser:
Þ   It gives an opportunity to the appraiser to develop a general idea of individual jobs and departments.
Þ   For every new or difficult situation new idea is generated for improvement or for overcoming that problem.
Þ   It gives an opportunity to integrate team and individual objectives and targets with departmental and organizational objectives.
Þ   It gives an opportunity to explain the amount of work expected by manager from teams and individuals.
Þ   It gives an opportunity to focus more on targets.
Þ   It enables to form more productive relationship with staff based on mutual trust and understanding.
3)    For the Appraisee:
Following are the benefits for the appraisee:
Þ   Increased motivation.
Þ   Increased job satisfaction.
Þ   Increased sense of personal value.
Þ   Increase in morale of an employee.
Þ   It gives an opportunity to know their strength and weaknesses.
Þ   It gives an idea about areas of their improvement.
Þ   There will be a chance to subordinate to express his views even after performance appraisal.