Common performance appraisal methods and their advantages and disadvantages

A rigorous, long-term performance-based pay system is an effective way for the company to continuously improve employees' work capabilities, working methods, and employee performance. 3.This approach rewards high-performing employees and also acquires and retains high-performing employees.

4.When the recession occurs, although there is no bonus, due to the low wage cost, the company can also not fire people, less fire people, so that employees have a sense of security and increase employee loyalty; When the economy recovers, the company also has an ample pool of talent. Each enterprise has its own performance appraisal standards, the main purpose of which is to motivate employees, complete their obligations within the specified time, through the corresponding remuneration, but also promote the enthusiasm of employees, more can reflect the spur system of the enterprise.

There are advantages and disadvantages of performance appraisal, and reasonable control can better promote the relationship between the company and employees.

Goal-based performance appraisal. Management by objective was first pioneered by Drucker, a master of management, and is now widely used in the management practice of various institutions and organizations, and is currently the most common performance appraisal method. Pros:

1. The performance target in target management is easy to measure and decompose; 2. The openness of the assessment is better; 3. Promote interpersonal communication within the company. Disadvantages: 1. The guiding behavior is not sufficient; 2. There may be objections to the setting of goals; 3. The set goals are basically short-term goals, ignoring long-term goals.

KPI-based performance appraisal. KPIs are key performance indicators and are the ones that have a key impact on performance. The KPI indicator is the result of the decomposition, concretization and internalization process of the company's strategic objectives, and there are three main methods to determine KPIs, namely the benchmarking method, the success key analysis method and the strategic goal decomposition method.

Advantages: 1. Clear goals, conducive to the realization of the company's strategic goals; 2. Put forward the concept of customer value; 3. It is conducive to the agreement between the interests of the organization and the interests of individuals. Cons:

1. KPI indicators are difficult to define; 2. KPI will make the assessor mistakenly enter the mechanical assessment method; 3. KPIs are not applicable to all positions.

BSC-based performance appraisal. BSC was founded by Professor Kaplan of the USA, and according to the survey, 70% of the world's top 500 companies have used BSC, which shows that it does have a certain role in enterprise performance management and operation. It mainly includes 4 assessment dimensions, internal operations, customers, learning and growth, and finance.

Advantages: 1. BSC can decompose abstract and macro strategic objectives, refine and concretize them into concrete and measurable indicators. 2. BSC takes into account the financial and non-financial assessment factors, as well as internal and external customers, and also has a combination of short-term and long-term interests.

Disadvantages: 1. It is difficult to implement BSC and the workload is also large; 2. Unable to effectively assess individuals; 3. The BSC system is huge, and it is difficult to reflect its role in promoting the strategy in the short term.