Performance Appraisal is the systematic evaluation of the performance of employees and to understand the abilities of a person for further growth and development. 

PROS: 

They provide a document of employee performance over a specific period of time. 

• They provide a structure where a manager can meet and discuss performance with an employ ee. 

• They allow a manager the opportunity to provide the employee with feedback about their performance and discuss how well the employee goals were accomplished. 

• They provide a structured process for an employee to clarify expectations and discuss issues with their manager. 

• They provide a structure for thinking through and planning the upcoming year and developing employee goals. 

• They can motivate employees if supported by a good merit increase and compensation system. 

CONS: 

• If not done right, they can create a negative experience. 

• Performance appraisals are very time consuming and can be overwhelming to managers with many employees. 

• They are based on human assessment and are subject to rater errors and biases. 

• Can be a waste of time if not done appropriately. 

• They can create a very stressful environment for everyone involved.