How does performance management differ from performance appraisal?

Performance management is an ongoing process that encompasses a range of activities designed to improve both individual and organizational performance. It includes continuous feedback, coaching, and development initiatives aimed at optimizing employee contributions over time. This continuous nature allows for regular adjustments and improvements throughout the performance cycle.

On the other hand, performance appraisal is typically a more formalized and periodic review process, often occurring annually or semi-annually. It focuses on evaluating employee performance against established criteria and is usually highlighted by a specific assessment or review meeting. This process is often tied to administrative decisions, such as promotions, bonuses, or professional development opportunities based on the evaluation results.

By understanding that performance management emphasizes long-term performance improvement through ongoing dialogue and development, while performance appraisal serves as a snapshot evaluation, one can appreciate the distinct roles they play in an organization. This differentiation is crucial for effective HRM practices, ensuring that both processes are utilized appropriately to foster employee growth and organizational success.