An annual appraisal, otherwise referred to as annual performance appraisal, is a management system that will evaluate the level and quality of an employee’s performance. The immediate head of the employee conducts the appraisal, by filling out an assessment form that has been designed and developed to specifically meet the standard and key requirements of the organization pertaining to job functions and contribution. The result of the evaluation is discussed in-depth with the employee.

Five Fundamental Annual Appraisal Sections

Annual appraisals can be derived from standard models or can be customized based on the organization’s requirements. However, regardless of what format is being used, an annual appraisal should ideally comprise five basic sections and these are:

Section One: Organizational Core Competences

The first section comprise of knowledge, skills, and attitudes that are expected from every employee in the organization.

Section Two: Job Family Competencies

This refers to groupings of the individual jobs that share the same attributes and characteristics, regardless of what department, business, or industry. Examples of this are: managerial competencies, supervisorial competencies, sales competencies, and technical competencies.

Section Three: Key Job Responsibilities

This section comprises of all the major duties and responsibilities of the employee, as required of his job position.

Section Four: Projects and Goals

This section includes the employee’s activities outside those that are specified in his job description, which contributed to the team and/or organization’s success.

Section Five: Major Accomplishments

The last section highlights all the major accomplishments of the employee over the past 12 months.

Four Phases of Annual Appraisal

Whilst many companies conduct annual appraisals simply to follow protocols and procedures mandated by the human resource department, it is always beneficial to the company and its employees to put in much attention to this system. For organizations that take their employees’ performance seriously, they follow a four-phase model of performance appraisal, as follows:

Phase One: Planning

The employee and his immediate head will meet and set goals together on how to help the employee improve his work performance. This meeting will also discuss what needs to be achieved for the year, how these will be achieved, and when such changes are expected to happen. Planning phase usually takes place at the beginning of the year.

Phase Two: Execution

After phase one, the employee will start to work towards achieving the goals they have set. In this phase, there will be coaching and feedback sessions with the employee to help him increase his chances of reaching his goals.

Phase Three: Assessment

During this phase, the immediate head will take some time to reflect on the employee’s performance, prepare the necessary assessment documents, and then fill them out. In the assessment phase, the immediate head will also make some recommendations regarding any promotion and/or increase in compensation, as may be deemed appropriate based on the employee’s level of performance during the year.

Phase Four: Review

In the last phase of the annual appraisal, the immediate head schedules a meeting with the employee, and review the appraisal that has been made for him. Any concerns, questions, and clarifications regarding the assessment will be addressed in this session.

Advantages of Annual Appraisals

An annual appraisal has many advantages in direct relation to improvement of employee performance, which is precisely the reason why every well-managed company strictly implements it.

• First of all, appraisals are helpful in motivating the employee to give superior performance in the workplace. This is because with a performance appraisal, the employee will get a clearer understanding of what the organization expects from him, and be able to determine what is meant by “superior” performance, as indicated by the organization he belongs to.

• Secondly, it gives an opportunity to discuss with the employee any issues on poor performance, and counseling can be provided to help him. This is a good time for supervisors and managers to talk with the employee to point out work performance concerns and discuss how he can meet company’s expectations.

• Thirdly, annual appraisals will help set and measure goals for the employee to make sure that every person in the organization is geared towards achieving the overall purposes of their business.

• Lastly, any concerns on compensation, responsibilities, and other job related issues can be ironed out and discussed during annual appraisals thereby promoting better communication between the employee and the immediate head.