Appraisal methods are categorised into two types. Each method has its own merits and de-merits. One of the methods used by companies are traditional methods, which are divided into following types −
Ranking method − It is the oldest method used in performance appraisal. In this method, employees are ranked according to their order of worth. It is difficult to rank individually if the employee number is large.
Paired comparison − In this method, employees are compared according to one trait. Score of employee is based on their consideration on that particular trait. Better employee is ticked among others. The more the ticks in their name the more the score. It is difficult to be compared when the employee range is more.
Grading − Grading is divided into outstanding, satisfactory and unsatisfactory. There can be more grades added (if needed). Employees performances are calculated based on their performance. Main drawback is employees are rated on higher side of performance.
Distribution method − In this, statistics are used to compare between employees. It is easy to understand and apply in organisation. Tiffen develops this method.
Choice method − This method was developed by J.P.Guilford. In this method, instead of using statistics, statements are used to analyse employee performance. Statements will have both negative and positive statements. Each statement has its own rating.
Checklist method − In this method, Yes or No is used. It eases the burden for evaluator. It involves time, money and effect to prepare and evaluate.
Critical incident method − This method focuses on key behaviours in a job. Firstly, job behaviour of certain incidents are prepared. Secondly, experts are assigned and finally, rating (good or bad) is giving based on performance. This method helps to appraise the employees who are performing at critical conditions. These will take more time to evaluate.
Graphic scale method − In this, printed form is used for evaluation purpose. Performance is evaluated based on score obtained from printed form. This method is good, when there are different job behaviours.
Essay method − In this method, description is used to describe employee’s strength, weakness, performances and potentials. Suggestions are also given in this method. It does not need any format, training to complete. It only provides qualitative information. It takes more time to evaluate.
Field review method − It identifies inter-rater disagreement, helps to arrive at consensus. It is time taking process.
Confidential method − In this method, supervisor or immediate higher authority makes evaluation. It collects employees’ strength, weakness, character, discipline etc. These are reported and are used in giving promotions, transfers.