Performance Appraisal |How Performance Appraisal can Contribute to an organisation's Competitive Advantage

Performance Appraisal |How Performance Appraisal can Contribute to an organisation's Competitive Advantage 

“Performance appraisal offers competitive advantage to an organization by enhancing performance, aiding in correct decisions, safeguarding legal compliance, diminishing job dissatisfaction and employee attrition and ensuring consistency between organizational strategy and behaviour.”

PMS Policy and steps

The emphasis should be that performance evaluation contributes to the firm’s competitive strength. In addition, promising high level of performance helps identify Employees with potential, reward performance equitably and determined employee’s need for training. Precisely, performance evaluation helps an organization gain a competitive edge in the following ways.

1.  Improving performance

2.  Making correct decisions

3.  Ensuring legal compliance

4.  Minimizing job dissatisfaction and turnover

5.  Values & Behavior

6.  Strategy & Behavior

Why PMS often leads to dissatisfaction among good performers

Thus, performance appraisal management system has strategic significance to a firm in 3 ways – feedback mechanism, Stability between organizational strategy and job behaviour and Stability between organizational values and job behaviour.  

Performance Appraisal Management System (PAMS)| Guidelines for developing a Performance Management System