List three solid reasons performance appraisals are important.

Following are the three reasons that I believe make performance appraisal very important.

  1. Performance appraisal is important because it provides a guideline to the process of employee compensation. The organization can do the performance appraisal of its employees and come up with standards to compensate different employees in different manners.
  2. Performance appraisal is an important tool to assess the strengths and weaknesses of the employees. Training programs can then be based on the inferences made after performance appraisal.
  3. Performance appraisal provides the management to provide feedback to its employees on their progress.