I hope below mentioned steps will help you in designing appraisal policy for your organization-
Set Appraisal objectives and policies - First of all you need to set objectives of your performance appraisal and then based on these objectives you need to set policies for the same i.e, eligibility criterion, period of appraisal(annually, half yearly, quarterly), define promotion and increment policies separately etc.
# Ensure full confidence of top management while making policies.
Derive Performance appraisal technique - Out of several techniques for performance appraisal you need to derive one technique for the appraisal based on the nature of your organization (360 degree appraisal, ranking or grading method etc)
Prepare Appraisal form - Now you need to make an appraisal form/Questionnaire used at the time of appraisal. For this form you need to set the attributes of the employees performance on which you want to proceed with your appraisal, like Productivity, Quality of work, Punctuality, Attendance, Grooming etc.
Conduct Appraisal - Now final step is to conduct appraisal at the designated time, please ensure timely completion and strict confidentiality of the data at the time of appraisal.
For your better understanding I will give you a simple procedure you may edit/modify the same as per your wish -
1- Conduct appraisals at the end of financial year, that means in the month of March and make increment and promotion effective from 1st April of the coming financial year. For eligibility you may use minimum of 6 months tenure as a parameter or you may also do appraisal for every employee employed till February, In that case you need to increase the salary on pro rated basis. For example if an employee joined in the month of December and is entitled for 15% Hike, he will be getting increment of 15% for 3 months out of 12 months.
2- You may use grading method for your appraisals, for this you need to segregate the groups of your organization, easy will be segregate on the basis of departments. Now make a list of the employees for each department and write the attributes of appraisal in front of the names. Now you need to take feedback of reporting manager on the form on the basis of grades (A,B,C,D), you may take final grading by the departmental head (preferred). You may also ask the departmental head whether the particular employee is eligible for promotion or not.
3- Now you will get the final grading for all employees as A, B ,C ,D now set the %age of increments for these grades like A - 20%, B-18%, C- 15%, D-10% .
4- Next step will be releasing the promotion and increment letters to the employees.
I hope this process would have simplify appraisal procedure for you.
Thanks for your reply......
Could also let me know what role does KRA do in performance appraisal??
Also let me know When we have to prepare KRA either at the time of joining of employee or at the time of performance appraisal.....PLZZ CLEAR ME THE CONCEPT OF KRA
KRA's (Key Result Area's) are prepared at the time of drafting JD (Job Description) for a particular position. KRA's are the major attributes of job description which defines major job responsibilities of that particular position on which employee's productivity is measured.
Well KRA plays very important role at the time of performance appraisal, because an employee's performance is measured on the basis of KRA assigned to him. For example, you may be on a generalist role of HR but you would not be dealing with all functions of HR, suppose you are majorly into TA and Training, so your KRA will be talent acquisition and training, so at the time of your appraisal your reporting manager will measure your performance based on your productivity i,e, how productive you were, specially into these two functions during the tenure.
I hope your doubts are clear now.
I would like to know what is the relation between goal setting and KRA.
I understand that goals are at the organisational, departmental level and based on these goals what relationship exists between Goals setting and KRA.Please elaborate. Many times there is confusion that comes up is goals when brought down at individual level becomes KRA then what is the relation betwen them?.Is it that KRA's and goals are separate?.
Request all to explain and assist.
In my views goals are set to achieve KRA's, and they are very closely interrelated with each other when it comes with individual goals. In a broader view generally individual goals are set based on organizational, departmental or line goals. For example, as an HR your individual goal may be to keep all employees engaged with at work, with this goal your KRA's can be set as taking employee engagement initiatives, carry out fun@work activities, conducting HR connect sessions etc etc. , so in my views this is the fine line difference between individual goals and KRA's.