Question

Performance appraisals generally fulfill two functions. The first is to identify individual strengths and weaknesses and to develop action plans for improving performance. The second involves salary or merit adjustments. Why should these two functions be addressed at different times?

1) If employees are upset over a salary adjustment, they will be more willing to listen to ways they can improve
2) Employees are so eager to learn about a potential raise that they tend to tune out constructive feedback
3) It is too much information to discuss at once
4) Managers tend to spend too much time talking about how the employee can improve his or her performance and not on justifying the salary adjustment
5) If the manager is giving employees good news regarding their salary adjustment, they will not have to discuss the employees' strengths and weaknesses

Answer 1

Two critical functions of the performance appraisal process are feedback on employee performance and decisions related to compensation and salary adjustments. These should be addressed separately to ensure clear, unbiased assessment, and to allow employees to focus on feedback rather than being preoccupied with financial outcomes. This helps maintain fairness and transparency within the appraisal process.

Step-by-step explanation:

Performance appraisals serve two critical functions within an organization. The first function is to assess and provide feedback on employee performance, recognize strengths and weaknesses, and establish developmental plans to enhance one's skills and abilities. The second function ties into compensation decisions, such as salary adjustments or merit-based increases.

It is recommended that these two functions be addressed separately to ensure each gets the proper attention and to avoid conflating performance feedback with financial rewards. This separation helps to ensure that employees focus on feedback for improvement rather than being preoccupied with the outcome of salary changes. It also helps managers to provide clear, unbiased performance assessments and maintain the primary goal of development during appraisal discussions.

Addressing these functions at different times can prevent employees from feeling overwhelmed and increase their receptivity to constructive feedback. Moreover, separating discussions about performance from salary discussions can help maintain transparency and fairness in the appraisal process and reduce the likelihood of employees associating their self-worth solely with monetary compensation.