What is the difference between a performance review and appraisal?

performance review vs performance appraisal

Tired of those nerve-wracking annual appraisals that leave you feeling like you’re in the hot seat? And also frustrated by the nagging suspicion that they might be biased?

Many employees share these concerns, so we’re here to learn the difference between a performance review and an appraisal.

So, let’s demystify the appraisal process and discover how it impacts you, so you can find ways to make it less stressful and more fair.


What is a performance review?


A performance review is a structured assessment regularly conducted between an employee and their supervisor or manager.

The primary purpose of a performance review is to evaluate and discuss an employee’s job performance, accomplishments, strengths, areas for improvement, and overall contributions to the organization.

During the review, both parties can engage in a constructive dialogue about the employee’s goals, professional development, and career path within the company. 

It’s a chance to celebrate successes, address concerns, set new objectives, and establish expectations for the future. These discussions often serve as a basis for determining salary increases, promotions, or training and development plans.

In the modern way of working, people use the centralized platform like the performance management software to record the reviews, share ongoing feedback, analyze data, and more.

What is performance appraisal? 


Performance appraisal is a systematic and formal process used by organizations to assess an employee’s job performance and provide feedback.

It typically involves a structured discussion between the employee and their supervisor or manager, where accomplishments, strengths, areas for improvement, and future goals are discussed.

Performance appraisals serve several important purposes, including identifying training and development needs, setting performance expectations, and making decisions about promotions, salary increases, and other HR-related matters.

Like performance reviews, you can handle this on performance management software as well.

They are a valuable tool for both employees and organizations, as they encourage communication, align individual and organizational goals, and ultimately contribute to improved performance and career development.


performance review vs performance appraisal

Performance Reviews vs. Performance Appraisals


Performance ReviewsPerformance Appraisals
What is it?
A formal or informal assessment of an employee’s work performance.
What is it?
A formal, regulated assessment mechanism in which managers and other key stakeholders evaluate an employee’s work performance.
It’s purpose
To provide feedback to employees on their performance and to identify improvement areas.
It’s purpose
To evaluate an employee’s performance against specific criteria and to determine their level of performance.

Annually or biannually
Typically annually or semi-annually
Conducted by 
Managers or Supervisors
Conducted by 
HR Professionals or Managers
More flexible and informal
More structured and formal
Typically used in
Identifying training and development needs
Typically used in
Determining compensation and promotions

Performance review examples


Employee self-evaluation examples


We have supposed a Product Manager for these self-evaluation examples to make them more realistic and relevant.


Recognizing positive performance


1. Successful product launch: In the past quarter, I successfully led the launch of our new product, exceeding the initial sales targets by 20%. This achievement demonstrates my ability to plan and execute product launches effectively.

2. Cross-functional collaboration: I actively collaborated with the development, marketing, and sales teams to ensure alignment on product strategy. This led to a 15% increase in cross-selling opportunities and improved communication among departments.

3. Customer satisfaction: I received consistently positive feedback from customers, with a Net Promoter Score (NPS) increase of 10 points. This reflects my dedication to meeting customer needs and improving product quality.

4. Problem-solving: When faced with a critical product issue, I quickly identified the root cause and implemented a solution, reducing product downtime by 30%. This showcases my problem-solving skills and ability to handle crises effectively.

5. Mentoring and coaching: I actively mentored two junior product team members, helping them develop their product management skills. Both team members showed significant growth in their roles, indicating my commitment to team development.


Acknowledging improvement areas


1. Time management: I sometimes struggle with time management, leading to occasional delays in project timelines. I plan to implement time management techniques to enhance my productivity and meet deadlines consistently.

2. Data analysis skills: While I have a good understanding of our product data, I recognize the need to improve my data analysis skills to make more data-driven decisions. I will invest time in further training and development in this area.

3. Stakeholder communication: I occasionally fail to proactively communicate project updates to stakeholders, leading to misunderstandings. I will improve my communication by setting up regular status meetings and providing timely updates.

4. Risk management: In the past quarter, I overlooked a potential product risk that could have been mitigated earlier. I will strengthen my risk assessment and mitigation skills to prevent such oversights in the future.

5. Innovation: While I excel at managing existing products, I realize the need to foster a culture of innovation within the team. I plan to encourage more creative thinking and idea generation among team members to drive innovation in our products.


Performance review examples for managers


We have supposed that a Marketing Manager is conducting performance review for their team.


Recognizing positive performance


1. Successful campaign execution: [Team Member’s Name] demonstrated exceptional skills in planning and executing our recent marketing campaign, resulting in a 30% increase in website traffic and a 25% boost in lead generation. Their strategic thinking and attention to detail played a significant role in this success.

2. Content quality: [Team Member’s Name] consistently produced high-quality content that resonated with our target audience. Their blog posts and social media updates received an average engagement rate 15% higher than the industry benchmark, showcasing their ability to create compelling content.

3. Project leadership: [Team Member’s Name] took the lead on a complex marketing project, coordinating efforts across multiple teams and meeting all project milestones ahead of schedule. Their leadership and project management skills were instrumental in the project’s success.

4. Data-driven decision-making: [Team Member’s Name] demonstrated a strong commitment to data-driven marketing. They conducted in-depth data analysis that led to optimization strategies, resulting in a 10% increase in conversion rates for our email campaigns.

5. Client relationship management: [Team Member’s Name] consistently received positive feedback from our key clients for their exceptional communication and responsiveness. Their ability to build and maintain strong client relationships has been instrumental in client retention and growth.


Acknowledging improvement areas


1. Time management: [Team Member’s Name] has occasionally struggled with time management, leading to missed deadlines on two projects. We encourage them to implement time management techniques and better prioritize tasks to meet deadlines consistently.

2. SEO knowledge: [Team Member’s Name] could benefit from enhancing their SEO knowledge and skills to improve the organic search performance of our content. Additional training in SEO best practices is recommended.

3. Cross-functional collaboration: While [Team Member’s Name] excels within the marketing team, there is room for improvement in cross-functional collaboration. Encouraging more proactive communication with other departments will help ensure smoother project execution.

4. Adaptation to new tools: [Team Member’s Name] has been somewhat resistant to adopting new marketing automation tools, which could enhance our efficiency. We encourage them to embrace training and fully utilize these tools to streamline processes.

5. Innovation: [Team Member’s Name] has shown creativity in content creation but should focus on fostering a culture of innovation within the team. Encouraging idea generation and experimenting with new marketing strategies can lead to more innovative campaigns.


Performance appraisal examples


Suppose this appraisal is for a Email Marketing Executive, and your company conducts annual performance appraisals to evaluate your job performance over the past year.

This is a positive appraisal where the team members got the raise successfully.


1. Evaluation process


The performance appraisal process typically begins with a self-assessment where you reflect on your achievements and areas of improvement.

Your supervisor reviews your performance and may collect input from colleagues and stakeholders who have worked closely with you.

Data from email marketing campaigns, such as open rates, click-through rates, and conversion rates, are analyzed as part of the assessment.


2. Achievements


During the appraisal discussion, your supervisor highlights your achievements. For example, they may commend you for designing and executing highly effective email campaigns that consistently exceed industry benchmarks.

Your ability to segment the email list for targeted messaging, resulting in a significant increase in engagement and sales, is recognized as a major accomplishment.


3. Areas needing improvement


Your supervisor also discusses areas where you can improve. They may mention that while your email content is engaging, there is room to enhance the automation of email workflows to save time and improve efficiency.

They may suggest further refining A/B testing strategies to optimize email subject lines and content based on subscriber preferences.


4. Feedback from others


Feedback from colleagues and stakeholders is considered. Your cross-functional teamwork, particularly with the design and content teams, is commended for ensuring cohesive and visually appealing email campaigns.

Clients and customers have praised your responsiveness to their inquiries and suggestions, reflecting your interpersonal skills.


5. Compensation and career progression


Based on the overall assessment and your contributions to the organization’s marketing efforts, your supervisor recommends a salary increase.

They also discuss potential career progression opportunities within the marketing department, such as taking on more strategic roles or leading a team of email marketers.


6. Performance Improvement Plan (if necessary)


If there are specific areas where improvement is needed, your supervisor may outline a performance improvement plan. For instance, they might recommend additional training or mentoring to enhance your email automation skills.

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Gaurav Sabharwal


Gaurav is the CEO of JOP (Joy of Performing), an OKR and high-performance enabling platform. With almost two decades of experience in building businesses, he knows what it takes to enable high performance within a team and engage them in the business. He supports organizations globally by becoming their growth partner and helping them build high-performing teams by tackling issues like lack of focus, unclear goals, unaligned teams, lack of funding, no continuous improvement framework, etc. He is a Certified OKR Coach and loves to share helpful resources and address common organizational challenges to help drive team performance. Read More

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