Just the word does people shiver. There are so many things that can be wrong with performance appraisals that you don’t have to dig deep to find them. Just ask the first manager or supervisor or just a regular employee to get a whole story about what is wrong with it in general and with the system in their company specifically. It seems that not many people are happy about their performance appraisal system and the fancy elaborate computerized systems have not improved this much over the years.
The world without performance appraisal
Having worked for a company that did not actually have performance appraisals, I can say that the encouragement of regular discussions about how things are going is more powerful to increase productivity than any performance appraisal system I know.
Salary increases were not determined by the actual performance of the individual but determined by the market. If the market decides on average to raise the compensation for that job, then the individual would get a raise and if the market remained at the same level or even dropped, the individual would not progress, unless they were still young in the position and were growing to the full salary for the position.
It is difficult to capture this system in a simple blog post as I would not give the system behind it enough credit. Feel free to contact me if and when you are curious about this system. I can wholeheartedly recommend it and will be happy to discuss how to introduce the system in your organization.