What Are the Strategic Benefits of Performance Appraisals?

by Neil Kokemuller; Updated September 26, 2017
Some companies use 360-degree feedback with additional evaluations from peers, customers and subordinates.

Strategic human resources has become a prominent concept in the early 21st century as companies attempt to make HR more of a proactive strategic component. Strategic performance appraisals are intended to align performance evaluations with company goals and to motivate employees to optimize performance in their jobs.

Alignment

Aligning employee performance with your organizational mission and goals is a primary benefit of strategic HR. Each employee's evaluation should relate to how his job benefits the organization and how that employee is fulfilling his role. This means careful analysis and review of job descriptions to align duties and responsibilities of a given job to its department and ultimately with corporate objectives.

Optimized Performance

Evaluations should motivate employees to better performance. For an employee who performs well, the evaluation gives his manager an opportunity to praise his work and to pose additional challenges for growth and development. For a struggling employee, the evaluation gives the manager a chance to set out standards of expectations and to discuss with the employee ways that he can reach the established objectives. Too often, employees view evaluations only as an opportunity to get raise consideration and managers often drop surprises on unsuspecting employees.

Succession Planning

A benefit to employees with effective evaluations is the opportunity to discuss career objectives and set goals to attain them. For the organization, evaluations help with succession planning, which is identifying qualified candidates to take over key positions when the people holding those jobs retire or leave. With strategic and well-planned evaluations, company leaders can discuss the potential they see in an employee and plot a course to get the skills and experience necessary to work into the identified role.

Feedback

From a strategic standpoint, evaluations offer the company a chance to find out what employees need in terms of support and resources. When companies give employees the chance to ask questions and express concerns and suggestions, they learn how to better equip employees to deliver the best performance possible. Company leaders need the humility and willingness to find out what employees need that they currently do not receive.

About the Author

Neil Kokemuller has been an active business, finance and education writer and content media website developer since 2007. He has been a college marketing professor since 2004. Kokemuller has additional professional experience in marketing, retail and small business. He holds a Master of Business Administration from Iowa State University.

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