Appraisals are a valid tool for businesses of all sizes. A well designed, well executed appraisal scheme can benefit both employers and employees by providing a regular opportunity for:

  • Reviewing, managing and improving performance
  • Recognising achievement
  • Increasing motivation
  • Assessing strengths and weaknesses
  • Identifying training needs
  • Obtaining feedback and ideas
  • Clarifying and setting objectives
  • Identifying future potential.

The design of an appraisal scheme and the frequency of appraisals is a matter of choice based upon the objectives it aims to achieve. Most schemes focus on reviewing past performance, setting new objectives and identifying training needs. Some appraisal schemes are linked to pay reviews.

Where pay is related to individual performance, linking the appraisal to a pay review may be a logical and necessary process. It can, however, make it difficult to achieve some of the other appraisal objectives at the same time. For example, an employee who knows that a pay increase depends on a favourable assessment is unlikely to draw attention to any weaknesses in performance. It will therefore be difficult for an employer to identify the employee’s training needs.

Designing and implementing an appraisal scheme

A common reason for the failure of appraisal schemes is that they are too complex and require too much paperwork. What matters in an appraisal is that the discussion between appraiser and appraisee takes place and is acted upon. The paperwork is an important record of what was agreed but it is more important that there is an ongoing review of the commitments made by both parties during the appraisal meeting. Often objectives which have been set during appraisal and training plans which have been agreed are overtaken by events or other priorities. Managers should be focused on the ongoing process of performance management – supporting, monitoring and adjusting objectives – not form filling.

See Appraisal Form for an example of a simple appraisal form that you could base your own tailored form upon.

The appraisal form

Most appraisal schemes require the appraiser to complete an appraisal form. This constitutes the written record of the appraiser’s assessment of the appraisee’s performance. It is easy when designing an appraisal form to get carried away and try to cover too much ground. Keep the form simple and limit the questions to those areas which are key to your scheme’s objectives. Concentrate attention on job performance and the achievement or non-achievement of objectives, not the personal characteristics of the appraisee. Appraisal forms may be used to support unfair dismissal and discrimination claims which are brought before employment tribunals. It is therefore important that the criteria used to assess performance do not discriminate on any of the grounds covered by employment legislation – sex, sexual orientation, race, disability, religion or belief.

The appraisal meeting

Thorough preparation is the key to a successful appraisal meeting. Take time to review the employee’s previous appraisal form. Consider his/her performance since the last appraisal and whether or not the objectives which were previously set have been achieved. Look at the whole period of time since the last appraisal, not just the events which are freshest in your mind. Start putting together your assessments but do not reach too many firm conclusions. An appraisal is a two way process and your appraisee’s input might change your views. A good idea is to complete the appraisal form initially in pencil, not ink. Try to avoid subjective judgements. Instead, be ready with statistics, measurable results and actual examples to illustrate your points and back up your assessments.

This evidence based approach will help you to avoid some of the common pitfalls of appraisal, including:

  • The tendency to let one of the appraisee’s characteristics (good or bad) influence your rating of all of the other aspects of his/her performance;
  • The tendency to be overgenerous or overcritical “across the board”, so that it is difficult to compare your appraisees with others;
  • The tendency to allow recent events (good or bad) to distort your view of long term performance and achievement;
  • The tendency to “stay on the fence” and rate appraisees in the middle of a scale (a rating scale with an even number of points may help to avoid this by forcing the appraiser to opt for a rating above or below the middle point).

The structure of the appraisal meeting will be largely determined by the format of the appraisal form. Most appraisal meetings begin with a discussion of past/current performance and an assessment of how far objectives have been met. The discussion will then move on to the setting of new objectives and the identification of training and development needs.

Each objective set should be “SMART” – specific, measurable, agreed, realistic and time-limited. It is also important to obtain the employee’s agreement and commitment to any objectives which are set. If they are imposed or seen as unattainable, they will be resented and/or ignored.

For a step by step guide to conducting an appraisal meeting and setting objectives, please see Step by step guide to conducting an appraisal meeting.

Employees should be given a copy of the completed appraisal form and asked to comment on it for the record. Appraisal forms contain confidential information and should be held securely in the employee’s personal file. An employee who is dissatisfied with his/her appraisal should be given the opportunity to appeal to a more senior manager. This can be done as a further step in the appraisal procedure or as a formal complaint under the company’s grievance procedure. In either case, the employee should be allowed to be accompanied by a work colleague or a trade union representative at any subsequent appeal hearing.

Responsibility for the appraisal does not end when the meeting is over. If the scheme is to be effective and credible, all of the points arising from the meeting must be followed up and any agreed actions, such as providing training or additional support, carried out. The employee’s progress towards the objectives which have been set must be monitored as part of an ongoing process of performance management.