This project report is a review based on theory as well as research and experience. The research report starts with the background and explains it’s importance in the Performance Management System and also it’s changed scenario in Chapter 1. The essential components of an effective performance appraisal system consist of understanding it’s Foundations and the essential steps that lay the foundation. It is also necessary to recognize the Objectives and Benefits of this system. For benefit realization it is necessary to Identify Key Result Areas (KRAs) i. . Goal Setting and monitor resulting Performance so that a meaningful relationship between performance, reward and development of required skills, through counseling – if required, can be established. Finally lot of brainstorming is required to be done to devise a sound appraisal system by evaluating available techniques and implementation processes. One must remember that performance Appraisal is an inexact, human process and it is quite a challenge to actually implement it successfully. All these aspects form subject matter for Chapters 2 through 8.

Performance appraisal system has gone through a sea change over a period of time. In the beginning the process was non-transparent and the employee was kept in dark about his performance. No systematic exercise was done and the entire process was arbitrary. These earlier performance appraisal methods are discussed in Chapter 9. The current processes of performance appraisal involve self-appraisal by the employee too. Thus the system has gone through the phase of non-transparency to transparency. In the transparent system of appraisals appraisee is taken into confidence and the whole process is interactive.

Review process with employees is designed in such a way that employees become aware of what is expected from them, receive timely feedback and recognition for their achievements. Some of these relatively transparent methods are Appraisal Discussion-Dialogue Method of Appraisal, Competency Based Appraisal System, Potential Appraisal, Performance and Development Planning. While new frontiers to performance appraisal include Management by Objectives, 360? Feedback and Balanced Scorecard. These methods are explained in depth in Chapters 10 and 11 respectively.

In this technology driven era appraisals too can be done electronically. eAppraisal system with its salient features, benefits and process has been covered in Chapter 12. Finally, the report is rounded up by presenting a case study on one of the top Indian pharmaceutical companies as Chapter 13 and concluded in Chapter 14. The report is made useful for readers by incorporating Suggestions and Recommendations for all concerned on how to make a grand success of appraisal system followed by their organizations.

Few blank formats of different appraisal methods and processes have been included as Annexures (Annexure I to IX) in the report to show how today’s successful organizations are trying to assess and evaluate their employee performance. In conclusion, this project report will enable one to understand the concept of Performance Appraisal; it’s evolution from non-transparent to a transparent system. The report will also help to understand benefits and drawbacks of past and present appraisal systems.