Select an organization within your country that you are familiar with or employe

Question

Select an organization within your country that you are familiar with or employed with. Conduct
the necessary research to ascertain:
1. The method of performance appraisal applied by the organization.
2. The effectiveness of the performance appraisal method as a motivational tool.
3. Challenges associated with the performance appraisal system.
Summarize and post your findings and conclude by giving recommendations on how to improve
the performance appraisal process for the organization. Explain your answer with reference to
the key theories and current practices of motivation you have learned in this course.

Explanation / Answer

I would select the organization I was previously employed with for the research.

1. The organization had an annual performance appraisal system and the performance was evaluated on yearly basis. Employees used to submit their achievements to the management to show their performance and the supervisors used to evaluate the same and provide feedback based on their knowledge and experience. The performance rating was only based on the supervisor feedback.

2. The method was effective only to a certain extent because the salary increment and promotions were based on the ratings given. The employees who were received low rating were denied these opportunities and were dissatisfied. The method was not able to motivate each employees based on their requirements. Based on the motivational theories, the motivational factors may be different for each employee. Based Maslow’s hierarchy of needs, the basic needs like physiological, safety, social, esteem and self actualization needs are to be satisfied to motivate the employees. The performance appraisal was able to address only the physiological needs like salary, esteem needs through rewards and self actualization needs through promotions. It did not check whether the employee’s social and safety needs are satisfied or not. The method is not effective if we consider it through the equity theory of motivation. According to equity theory, motivation is correlated to the employees’ perception on fairness and if they feel any inequity, they would seek to adjust their input to reach the perceived level of equity. If the employee feels that he/she was treated unfairly by the management while giving rating, the employee will seek to adjust the effort to reach the balance between effort and rating. Hence we can understand that the method was not much effective as a motivational tool.

3. The main challenge associated with the appraisal system was the chances of unfair rating. Since the rating was purely based on the supervisor feedback, some of the managers used to use appraisal system for taking revenge on employees whom they do not like. Hence some of the good employees used to get low performance rating and some low performers used to get good rating based on favoritism. Another challenge is the effective monitoring of performances as supervisor may not be aware of all the challenges faced by employees throughout the year.

I would recommend the performance to be evaluated on a quarterly basis to analyze the performance better. A yearly evaluation may miss certain events. Another recommendation is to include colleague and customer feedback also regarding the performance because colleagues and customers know better regarding the performance of the employees. This will help to reduce the chances of unfair rating by the supervisors.

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