The Employee Appraisal Method Based on the Agreement on Objectives

The challenge for companies is to create a useful employee performance appraisal regarding the successful management of employees. Motivated and engaged employees are after all a company’s most valuable asset. In recognition of this, the paper deals with the employee appraisal method based on an agreement on objectives, which has now been established as a modern and important tool for management and appraisal purposes. As a result it can be determined that the objective agreement systems are deservedly one of the most widespread and popular management methods of our time because of their versatile usability and unmistakable advantages. The dynamic alignment with company objectives, the strong and cooperative integration of employees, the objective measurability of the objective agreements as well as the motivational effect are attributes that positively differentiate the procedure from other employee appraisal methods. At the same time, the missing operational feasibility, the lack of some objectives’ controllability, as well as low level objective agreements pose fundamental difficulties. Therefore, comprehensive requirements are necessary on the part of the company as well as on the part of the employees in order to guarantee a successful application of the theory and be able to avoid risks for the most part. Whether the risks or prospects are outweighed in a concrete case depends on the individual, complex organisation factors and conditions.