Article 05 : How performance appraisal affects talent management within an organization?

In the modernized world where high competition exists in every industry, consideration for performance appraisal is playing a crucial part in every organization. Performance appraisal mechanism is an area where it is considered as a vital tool for identifying strengths and areas of improvement. It helps organizations to take informed decision-making related to promotions, compensation, training, and development. An organized performance appraisal system would help organizations to keep up the good talented employees within the organization for a longer period.

1. Identifying High Capacity Employees

Identifying employees with higher capacity through performance appraisals, organizations tend to retain them because they are in need of talented workforce to fulfil their organization objectives and goals. These kind of employees are very much suitable for leadership roles and other advances career development opportunities such as giving them opportunities to work abroad which pays higher salaries. Therefore, organizations are able to develop the leadership pipeline in a smooth manner within the organization (Aguinis, 2025).

2. Aligning Employee Goals with Organizational Objectives

At present organizations they try to achieve their organizational objectives in methodical ways where the employee is not pressurized when achieving them. By giving performance appraisals to employees on time the employee goals will also be fulfilled while the organization objectives also get fulfilled accordingly without any hesitation. Furthermore, it also helps organizations to ensure that talented employees could be retained within the organization successfully (DeNisi and Williams, 2025).

3. Development and Training

After evaluating employee performance, some employees may be identified as they need more training requirements to get appraisals because they may not be suitable to receive them. Therefore, organizations give opportunities to develop employment skills, through targeted training programs. In talent management improving talents in employees who lack them is also having a positive impact to keep up the talented employees within the work force of every organization. Therefore, we can identify that Talent management strategies can be shaped around these insights to develop the workforce in a strategic way (Pulakos, 2025).

4. Retention and Engagement

At present organizations provide constant feedbacks relating for performance appraisals which energize employee performance and engagement in daily work. When the current workforce feels that the organization they are working provides them more opportunities to grow, they will be retained and nurtured within the organization (Armstrong, 2025).

5. Rewarding and Recognizing Talent

Methods of performance appraisals such as providing annual bonuses, compensation bonuses, and other rewards that will motivate the existing workforce. Recognizing and rewarding high performing employees gives motivation to other employees as well. Therefore, organizations will be able to reinforce the existing workforce within the organization successfully (Williams, 2025).

Conclusion

Performance appraisals provides an important role in talent management and develop the exiting talented employees as they provide a greater image of the organization. This would also help organizations to attract new employees who are talented and who would contribute towards succession of the organization (Pulakos, 2025; McKinsey and Company, 2025).

References

  • Aguinis, H., 2025. Performance Management. 5th ed. Pearson Education.
  • Armstrong, M., 2025. Armstrong's Handbook of Human Resource Management Practice. 16th ed. Kogan Page.
  • DeNisi, A. S. and Williams, K. J., 2025. Performance Appraisal and Management: A Multidisciplinary Perspective. 2nd ed. Taylor & Francis.
  • Pulakos, E. D., 2025. Performance Management: A New Approach for Driving Business Results. 2nd ed. Wiley-Blackwell.
  • Gartner Research, 2025. Performance Appraisals: A Tool for Talent Management. Available at: https://www.gartner.com.
  • McKinsey and Company, 2025. Using Performance Appraisals to Improve Employee Engagement. Available at: https://www.mckinsey.com .

Comments

  1. Naveen Wedasinghe ArachchiApril 1, 2025 at 4:55 AM

    By identifying strong workers, aligning goals, providing training, and giving rewards, companies can improve employee motivation and job satisfaction. Regular feedback and recognition make employees feel valued, helping them stay longer and perform better. A good appraisal system is important for both employee growth and business success.

    ReplyDelete
  2. Employee RelationsApril 4, 2025 at 8:36 PM

    Performance appraisal plays a crucial role in talent management by providing valuable feedback on employee strengths and areas for improvement, guiding development efforts. It helps organizations identify high performers for growth opportunities, align individual goals with organizational objectives, and ensure that talent is effectively nurtured and retained

    ReplyDelete

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