6 important Problems in Performance Appraisal:
Since performance appraisal is conducted by human beings, it is subjected to a number of errors, biases, weaknesses and pitfalls.
Some of these are discussed below.
1. The halo effect:
The halo effect is introduced when an overall impression of an individual is judged on the basis of a single trait. A high rating on one trait leads automatically to high rating on all other trait. Also, a very high rating may be given to protect an employee for whom there may be personal sympathy.
2. Constant error:
This error is a reflection on the trait of the rater. Some raters are, by nature, too liberal, others too strict and some tend towards rating most people in the middle.
3. Recency of events:
There is a tendency of many evaluators to give much more weight to the recent behaviour of the candidate than the past behaviour. This is based on the reflection that the future trend is established by the mere recent behaviour.
4. The central tendency:
It is the most commonly found error. It is the tendency of most raters to give average ratings to all or the center of the scale. This may be due to the fact that a very high rating or a very low rating could invite questions, criticisms or explanations.
Accordingly, an average rating is safer. It could also be due to the fact that the rather lacks sufficient knowledge about the applicant and hence, does not want to commit himself one way to another.
5. Errors of variable standards:
It is quite possible that organisations follow different standards of performance. Some divisional heads may require much higher quality of performance than others.
6. Other miscellaneous biases:
There may be some built – in biases in the minds of the rater, based upon his own perception of things, people and performances. A person may be rated higher because he is a ‘nice’ person or because of his seniority.