A large number of managers, human resource professionals, human resource consultants and researchers are recommending companies to get rid of the performance appraisal systems. The main argument given by the researchers is that the system of performance appraisals itself is based on a few wrong assumptions and it fails to fulfill its basic purpose.

The major arguments against performance appraisal given in favour of abolishing the performance appraisals are:

The first and the foremost argument is the fact that discrepancies between the theory and its application. There is often a disconnect between the theory and the practical implementation.

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PA is a bitter process for most of the employees which can create emotional pressures and stress for the employees
The focus of the PA process is too narrow i.e. just to determine the rewards and punishments for the employees by measuring their past performance.

  • The focus of the PA process is too narrow i.e. just to determine the rewards and punishments for the employees by measuring their past performance.
  • PA is often looked upon as a tool to control the employees by the superiors which dampen the intrinsic motivation of the employees.
  • Most of the managers and superiors are not trained enough to carry the processes in the appropriate and the structured manner.
  • PA process increases the dependency of the employees on their superiors.
  • PA process encourages accountability, approvals and discourages the spirit of creativity and initiative by employees and also demotivates them.
  • Performance appraisal are conducted by managers who are often not trained to be appraisers. This obstructs the genuine feedback, as it includes subjectivity and bias of the raters leading to incorrect and unreliable data regarding the performance of the employees.
  • PA can adversely affect the morale of the employees and create dissatisfaction among them, thereby affecting the organizational performance.
  • Performance appraisals and reviews are often time consuming, with faulty methods to measure performances and generating false results and the decisions taken can be politically influenced.

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An example to support the above mentioned points would be the case of an call centre employee – The appraisal of a call center employee is based on the amount of work they do, the number of calls they receive, the amount of revenue they collect, the average time they append on each call. But if analysed, all these factors depend on other factors like the response of the callers, the availability of the information asked for, the nature of the calls etc. which are often not considered during appraisals. But the employee being aware of all these factors, the situation can create stress and dissatisfaction among the employee.