What goes into a competent Performance Management and Performance Appraisal System

Apr 29, 2022

Companies are always keen on retaining good talent in the workplace and hence assessing each employee becomes an integral part of this. So how do companies go about evaluating their workforce? Performance management is a process of monitoring and evaluating an employee’s performance at work. The performance of an employee is measured by the competency expectations set by the organization. Assessing their performance includes both the core competencies required by the organization as well as the competencies specific to the employee’s job.

The main goal of this process is to create an environment where people can perform to the best of their abilities and produce the highest-quality work proficiently. The performance management is a continuous process — not a once-a-year activity.

Performance management (PM) includes activities that ensure goals are consistently being met in an effective and efficient manner. During this process the appraiser, often a supervisor or manager, provides the employee with constructive, actionable feedback based on the assessment. This in turn provides the employee with the direction needed to improve and develop in their job.

In its most fundamental sense, performance management software is a technology for implementing, tracking, and evaluating employee performance.

Infographic of a Performance Management Cycle

What is Performance Appraisal and what is it used for?

An efficient Human Resource department and its employees are assets to every organization who play an integral part in the company's overall development. Each employee performs certain roles and responsibilities to play a part in the organization’s overall success.

Like the famous quote explains, “You don’t have to be great to start, but you have to start to be great”. In order to climb the corporate ladder, the employees need to ameliorate their skills at some point, that's when the HR department comes in. Based on the type of feedback, a performance appraisal is also an opportunity for the organization to recognize employee achievements and future potential. After evaluating their performance, the organization rewards the top performers while the others are encouraged to increase productivity and work quality through structured programmes of learning and development.

Performance Appraisal can be defined as “A process that systematically measures an employee’s personality and performance usually by managers or immediate supervisors against the predefined attributes like skillset, knowledge about the role, technical know-how, attitude, and punctuality”

Infographic of the steps in Performance Appraisal

When is the Performance Appraisal Season?

You need to document your accomplishments and feedback in order to review your performance. Be self-critical and consider the areas where you work hard to overcome the shortcomings. This is an opportunity to highlight and document your performance. Ask for specific feedback from your supervisor about your performance.

If there are shortcomings or a need for training, leave with an action plan. By procrastinating or avoiding the need to upgrade, the employees often miss out on planning and achieving the goals. Never hesitate to ask for help or clarification on a specific topic from your seniors and colleagues at work.

How often do Appraisals have to be done?

89% of HR professionals agree that conducting performance management on an ongoing basis is more effective than yearly or twice a year reviews. With most companies conducting performance reviews every 3-6 months, it helps to keep the employees focused and motivated. Relevant and timely feedback is beneficial as issues can be raised early and changes can be made accordingly.

When is the right time to do Appraisals?

The performance appraisal helps the organization to determine the value and productivity that employees contribute, and it also helps employees to develop in their own roles. There are several ways managers evaluate the performance of their employees. Choosing the best approach depends on the needs of the workplace and the individual being reviewed. Some common performance reviews include traditional appraisals, self-appraisals, employee-initiated reviews, 360-degree feedback and management by objectives. The last type of assessment is steadily gaining in popularity in modern workplaces. This method involves the employee and manager agreeing to a set of attainable performance goals that the employee will strive to achieve over a given period of time.

The process of performance appraisal is like an investment for the company, especially for a developing country like India. The performance management system in India is an integral part of organizational strategies as it helps towards a high employee retention rate, positive appraisals, motivating them and instills a sense of pride and most importantly responsibility towards the organization.

Client Testimonials Across Business Verticals

  • Auto Ancillary Manufacturing

    "We have implemented all the modules of Wallet-HR in our organization. We are very happy to mention that the product works great and the Crystal team implemented the solution at cheetah pace with good understanding. Very commendable job considering the size of our organization. We have integrated attendance devices across our 45 locations to centralised attendance software and integrated to payroll along with other modules. As a result of complete HR automation we were able to save atleast 7% on our turnover year on year. We are extremely delighted to have chosen Crystal HR as our solution provider."


  • NGO

    "We have 9 companies with almost 4000 employees Over all; managing employee’s records was very difficult. We have chosen wallet-HR after evaluating many products. Now we are using few modules of Wallet-HR, further we are planning to use all modules from this financial year. We are very satisfied with the Wallet-HR software, because of its updated technology, and the time it saves. Wallet-HR gives us accurate results and reports as per our requirements. Good Luck to Crystal team!"


  • Pharma

    "Wallet HR has been implemented and integrated across all our 9 locations. We have strict FDI guidelines to follow in respect of access control and attendance, which we have tirelessly implemented with the help of Wallet HR suite."

    IT Head

  • Auto Ancillary

    "We have nine factories across different locations in India. Wallet-HR is implemented for managing our entire employee lifecycle. We had huge challenges in managing workforce using attendance devices. Crystal with their proprietary technology was able to provide us a seamless solution. We have been using Wallet HR for 6 years now with excellent backup support from Crystal whenever required."

    HR Head

  • Retail

    "We are amazed by the domain understanding of Crystal and the configuration capabilities of the product. They have been able to provide solution to all our issues without making any customization in the product. It is a great tool that helps to balance the entire process of our organization in an easy manner."

    HR Manager

  • Hospitality

    "Intuitive UI, dynamic functionality and robust technology is what made us choose Wallet HR amongst all other products in the market. Earlier we used to manually amend the attendance data before processing payroll, now everything is automatic, which in multiple ways has reduced the time and effort spent in validating the attendance. That is indeed great."

    IT head

  • Share Registrar

    "We are very impressed by the lightning speed of Wallet-HR’s payroll engine. We have been able to process payroll of around 4000 employees in less than two minutes."

    Functional Manager - HRD

  • Steel Manufacturing

    "Selection of vendor is a tough process in Hyundai. Wallet-HR has been selected by Hyundai software division to implement the solution across all Hyundai subsidiaries. As a first step we have implemented the solution at one of our subsidiaries in Sriperumbudur and we are happy that they have gone live without any fuss. Good job done by Team Crystal."

    HR Manager

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