Performance appraisal
In one sentenceA periodic measurement of what the employee achieved compared with the targets and tasks required. Development, promotion and bonuses, or a performance improvement plan, are based on it.
Simply put
In a performance appraisal you set criteria for each job and a weight for each criterion, then give the employee a score on each criterion, and the final score is the weighted total.
Make the criteria measurable as far as possible, discuss the result with the employee, and link it to clear decisions such as the annual bonus.
Worked example
An annual appraisal of an accountant at a factory with three criteria and weights set by the business (assumed figures for illustration).
Month-end closing on time: 80 × 50%40
Accuracy of entries and reconciliations: 90 × 30%27
Cooperation and development: 70 × 20%14
Final score out of 10081
Formula: Sum of (each criterion's score × its weight)
Don't confuse it with
Employee key performance indicators (KPIs)Indicators are figures measured continuously, while the appraisal is a periodic judgment that combines them with other criteria.