IB Business Management

Unit 2.1 Appraisals

Learning Outcomes

• The methods of appraisal:– Formative– Summative– 360-degree feedback– Self-appraisal (AO2)

• How innovation, ethical considerations and cultural differences may influence appraisal practices in an organisation (AO3)

What is an Appraisal?

• An Appraisal is a method of assessing an employee’s performance.

• Usually carried out in annual cycles

• Often carried out by line managers for their subordinates

• Can also be referred to as Performance Management

The Appraisal Process

What is the key purpose of Employee Performance Appraisals?

Purposes of Appraisals

Source: www.naukrihub.com

Methods of Appraisal

• Formative• Summative• 360º feedback• Self Appraisal

What do you think is meant by each of these methods?

Formative Appraisal

• Goal: to monitor employee performance and to provide ongoing feedback that can be used by employees in order to improve.

• Formative Appraisals:– help employees to identify their strengths and

weaknesses and target areas that need work– help employers recognize where there are

training needs

• Formative appraisals are generally low stakes and supportive

Summative Appraisal

• Goal: to evaluate employee performance at the end of an appraisal cycle by comparing it against some standard or benchmark.

• Summative Appraisals:– Used to inform decisions regarding

progression and pay rises

• Summative assessments are often high stakes, with rewards or sanctions based on the results

Self Appraisals

• Employees evaluate their their own performance

• What is the benefit to this?• What might the problems

be?

360º FeedbackWhat is the benefit of 360 degree feedback?

Which of these methods do you think would be most/least effective?

Could there be any potential problems?

WHAT ARE THE BENEFITS OF HAVING AN APPRAISAL SYSTEM?

The benefit of a business having an appraisal system?

• Target setting and monitoring can improve performance

• Can help to make sure that the right decisions are made regarding employees

• Opportunity for employees to be recognised and praised

• Areas for improvement can be recognised

What do you think would happen to an employee who had a bad appraisal?

Implications of a Bad Appraisal

• No pay rise• Issue an advisory letter• Offer support• Monitor Performance• Dismissal (eventually)

What difficulty might there be with conducting appraisals in a fair and consistent way?

Task

• Watch the appraisal video• Appraisal “Spot the gaffes”Questions:• What are the potential problems it is

aiming to identify with Appraisal Systems• Can you think of any other problems?• Can any of these problems be minimised?

Key Question

If a business wants to make sure that it’s appraisal system is effective, what should it make sure it does

Appraisals and the key concepts....

How might the following factors and influence appraisal practices in an organisation?• Innovation• ethical considerations• cultural differences