Question

Give any two differences between Performance Appraisal and Potential Appraisal.

How does performance appraisal differ from potential appraisal?

Give any two distinctions between potential appraisal and performance appraisal.

Answer 1

Sr. No.	Basis of Distinction	Performance Appraisal	Potential Appraisal
1.	Meaning	Assessment of performance on the job.	Assessment of unutilised capabilities.
2.	Time of assessment	After the job is done.	Before the job is done.
3.	Main purpose	To decide incentive pay, promotion, training needs, etc.	To decide future job assignments
4.	Basis of assessment	Quantity and quality of work done.	Personality traits, experience, aptitude, ambition, etc.

Answer 2

	Performance Appraisal	Potential Appraisal
1.	It primarily focuses on evaluating an employee’s past performance and achievements in relation to predetermined goals and responsibilities.	It primarily focuses on assessing an employee’s future potential and capacity to take on additional responsibilities, handle higher-level roles, or contribute to the organisation's long-term success.
2.	It looks backward in time to assess past performance and provide feedback for improvement.	Potential appraisal is more future-oriented.