Employee appraisals are very time consuming, for managers, for employees, and for HR. Therefore, you shouldn’t do them without questioning if they actually serve a true purpose, if really have a positive impact. 
When thinking about the reasons of why you should or shouldn’t have employee appraisals, you should first determine which higher principle your organization runs on. This principle – which may exist without people being entirely aware of it – influences how decisions are being made and how people managers behave. Consequently, employee appraisals serve different purposes for different types of organizations. Which of the following four principles of organization describes yours best?


In autocratic organizations, you have traditional hierarchies

This means that managers usually make decisions without consulting their direct reports and lower-level positions are not expected to bear any consequential responsibilities. The focus of the principle of autocracy lies in ensuring stable, unchanging processes and clearly defined responsibilities. Many companies in the production industry still follow this principle.

Employee appraisals in autocratic organizations are a tool to determine if an employee has performed their duties as expected.

In other words: It’s a control instrument. If all boxes are ticked, there is no need for change. If someone is underperforming, they either have to change to a less challenging job role – or leave the company. If someone is overperforming, they may qualify for a promotion.


In bureaucratic organizations, job roles are the guiding principle

Unlike the situation in autocratic organizations, making decisions in bureaucratic institutions isn’t just the privilege of managers. Rather, each single job role within the institution is meticulously defined: As a job holder of a given role, you know exactly what your tasks and responsibilities are – and what kind of decisions you can make. Even lower-level positions often have decision-making power, as pre-defined in their job descriptions. Most public institutions follow the principle of bureaucracy.

The purpose of employee appraisals in bureaucratic institutions is enforcing the strict job roles, ensuring that everyone understands and performs the task assigned to them – and doesn’t interfere with anything beyond their realm of responsibility.


In task-oriented organizations, it’s about getting things done

Those companies (they are mostly private companies) often have a matrix org chart that allows them to allocate their workforce flexibly across business units and departments. The organizational structure is shaped by putting whatever needs to be done first – and then setting up project teams qualified for successfully accomplishing the assignments. As an employee, you often have a say in where you will work next and which areas suit you most.

Many large global enterprises follow the principle of task orientation.

Employee appraisals in task-oriented companies are about evaluating whether the tasks an employee was assigned to were a good fit for their individual skill set – and to determine the general direction the employee wants to follow in terms of learning and development. It is, therefore, a more employee-centric approach than the previous two which are purely organization-centric.


In people-oriented organizations, innovation is existential

Companies of fast-paced, highly innovative industries – such as the IT sector or consumer electronics – need employees who can think outside the box, come up with new ideas, change their perspectives, and quickly adapt to new situations and environments.

Those companies do everything in their power to enable a working environment that lets people thrive in what they do best. Everyone is responsible for the company’s success, everyone is part of the decision-making process, and everyone is expected to come up with new ideas and with suggestions for improvement.

In order for such an organization to work, each side needs to appreciate the needs and goals of the other side and help each other to achieve them: Employees need to work towards reaching the company’s objectives while the company needs to give people space and resources to satisfy their individual needs.

Therefore, employee appraisals in people-oriented companies have a very different focus than the other three organization types: They aren’t about past performances, but all about the future. Employees are asked to identify and voice their own development needs and learning goals – and to prioritize them. Together with their team leader, they then determine how those focus areas can be used best for the success of the company.



As you may have guessed, most organizations today are not purely autocratic or task-oriented or one of the other two, but rather a mix of two or more principles. If you want your employee appraisals to be truly useful, it is probably a good idea to know what kind of mix your organization is made of. This insight is the prerequisite for determining the purposes your employee appraisals should have – and then to analyze if the appraisals are currently set-up accordingly.


For further reading, download Robert J Engelbrecht’s eBook The power of Initiative, Challenge and Enthusiasm


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