Performance Management vs Performance Appraisal

We have worked with some of the most advanced organizations in terms of Performance Management Most organizations have some type of employee appraisal or review system and are experiencing the shortcomings of manual Appraisal systems. In talking about Employee Performance Management, the question we are asked most often is “what is the difference between Appraisal systems and Performance Management” Following is a process diagram that provides a graphical view of the major differences between the two processes:

Performance Management systems typically are:

• 1. A definition of what you want an employee to do for the next performance period (normally the next quarter, half year or full year). The definition includes specific objectives for the period, backed up by a job description which includes the normal expectations for that position

  2. A review of remuneration/bonuses if these objectives are met

  3. A review of the personal development objectives

  4. Formally Performed quarterly, half yearly or annually but with input all year round

  5. Typically fully automated where the information is accessible to all participants at any time

  6. Content rich if the automated Performance Management system has features such as a Performance Diary