This leads to reduced error, increased productivity, improved quality of service to the external customers, as well as enhanced employee motivation, commitment and a sense of ownership. Secondly, the system provides an opportunity for performance related discussions including setting work objectives for the employee, aligning individual and organizational goals, identifying training and development needs, and discussing career progression opportunities in a candid, one-on-one type forum. Thirdly, the system standardizes performance appraisals and makes them objective by providing uniform processes and criteria. This further results in valid and legally defensible basis for rewarding and recognizing individual performance. And lastly, the system affords the corporation legal protection against employee lawsuits for discrimination and wrongful termination. These benefits are not entirely inclusive however, they represent an idealized view of performance appraisal systems; a view that so many want to replicate, but so few can achieve. What is it about organizations" that causes performance appraisal systems to fall short of their desired goals? Is there a better course of action? I believe we must take a rational look at the true form and function of the performance appraisal system as they are, to better understand why they fail and how we can adjust them to enable them to have the effects they are intended to have on the people they are intended to help. .
Performance appraisals "typically have two components: text, and a number. The number is usually the basis for determining the employees merit increase" (Nikols, 1997, p. 4). The problem is, the size of the pay raise is usually modest at best and offsets the cost of inflation, much as a cost of living increase would do. I don't anticipate a great deal of incentive there. Nikols states, "The structure of the typical performance appraisal system makes managers who prepare appraisals the targets of efforts aimed at influencing, shaping and just plain manipulating their perceptions and the appraisals based on these perceptions" (1997, p.