Purposes of a formal appraisal

  1. to improve the functioning of the organization:

    • Provides information upon which to base management decisions e.g. salary increase, promotion, transfer, termination
    • Effectiveness of an organization’s hiring and recruitment practices.
    • Identify training and development needs so that staff development programs can be structured appropriately.
    • establishment of standards of job performance.
  2. to foster the personal development of the employee within the organization.
    1. Both employee and supervisor can develop plans that will result in personal growth, increased skill performance, technical training or a formal advance in education which will improve future performance.

    2. Employee can make management know, their goals and aspirations.

    3. Improves communication between employer and employee.

    4. Motivates employee to continue to do their best.

    5. An opportunity to supervisor to recognise employee’s accomplishments.

  3. to provide a basis for termination of an employee from a position, should that be necessary.

  4. According to Newstrom:
    1. to allocate resources
    2. motivate and reward employees
    3. give employees feedback about their work
    4. maintain fair relationships within groups
    5. coach and develop employee
    6. comply with regulations
  5. To express appreciation for employee contributions

Thus it is necessary for proper management and employee development.