Principles of Organizational Behavior, 3rd Edition

10Embed Performance Appraisals into Broader Performance or Management Systems

MARIA ROTUNDO AND KELLY D. MURUMETS

Joseph L. Rotman School of Management, University of Toronto

A performance appraisal provides an assessment of the extent to which the employee completes the work that is agreed in a manner that is consistent with the organization's values and that motivates employee performance improvement and growth. Historically, performance appraisals are conducted once a year and have formed an essential part of the performance management process, whereby the information obtained from these assessments has informed decisions that organizations and its leaders take. The performance management process is ongoing and encompasses more than just the appraisal. There is a vast literature on the benefits and drawbacks of performance appraisals and performance management more broadly along with factors to consider in their design and implementation. Nevertheless, a comprehensive review of these two processes and their literatures is not the focus of this chapter. Rather, this chapter outlines some key components of a performance appraisal and some steps that leaders can take throughout the performance cycle to motivate employee performance improvement and growth.

There are at least four assumptions underlying the two sections in the chapter. Two of these assumptions relate to the purpose of the performance appraisal. The first assumption is that organizations have an interest in designing ...