Performance Appraisal in Commercial Banks: A Case Study of Dashen Bank S.C.
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Date
2007-07
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A.A.U
Abstract
Performance appraisal, though an important function of human resource/personnel
management, has not received the degree of concern it deserves. This function, if properly
exercised by organizations, can serve a number of purposes, mainly administrative and
developmental in nature. However, despite these intended goals, performance appraisal seems
not to be effective in most cases mainly due to the subjective nature of criteria (standard) of
performance, lack of rater understanding of or inadequate training on performance appraisal,
which consequently led to the less importance and emphasis attached to it.
For an appraisal system to meet its desired goals, questions such as: 'What purposes should it
serve?' 'Who should be in charge of evaluating performance?' 'What aspect of performance
shall be appraised?' 'What method(s) should be adopted?' 'How often should appraisal
conducted?' 'What does employee participation in and their perception towards the system
look like?' 'What potential problems are encountered in the process and how can they be
overcome?' and 'What is the importance of giving feedback and handling post assessment
performance discussions with employees?' need to be addressed properly.
This study has tried to address each of the above and other related issues by taking Dashen
Bank S. C. as a case study organization. Accordingly, samples from the Bank's staff members
(both supervisors or managers and non-supervisors) were selected and administered
questionnaires and some interviewed with the objective of assessing the effectiveness of the
appraisal system. The results are presented in this paper.
While the practice by Dashen Balik S. C. has been that immediate supervisors are the people
in charge of appraisillg employees, response from the sample respondents has indicated that
others such as peers, subordillates, customers, or any combinatioll of these should be allowed
to participate if the process is expected to be more effective. It is idelltified that the appraisal
format addresses differellt aspects of employee performance with traits being the dominant
olles. It is also found out that the Bank adopts the rating scales method of appraisal. Although
the existing practice of appraising employees twice a year has got the highest support among
the sample respondents, some have suggested a more frequent time period for increased
effectiveness. Employee participation in the appraisal process is set at a low level. Most of the
non-supervisory respondents perceived performance appraisal as a punishment tool
cOlltributing little to motivation while their supervisory counterparts perceived it as an
administrative and developmental tool. Owing to subjectivity (non-job-relatedness) of most of
the performance criteria in use, problems related to measurement, rater bias, and lack of
appropriate rater training are seen to characterize the Bank's appraisal system. Problems are
always prevalent and what one should be concerned about is on how to overcome them.
Irrespective of how they are handled, the appraisal system of the Bank is found to encourage
giving performance feedback alld handling post assessmellt interviews with employees.
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Keywords
Appraisal in Commercial Banks