Question

Which of the following is a principal use of performance appraisal?

Options

• Incentive compensation

• Placement

• Psychological pressure

• All of these

Answer 1

All of these

Explanation:

1. Incentive compensation: Performance appraisal helps in determining appropriate wage incentives based on employee performance.
2. Placement: It helps in assigning employees to roles where they can perform most efficiently by evaluating their skills and potential.
3. Psychological pressure: Performance appraisals remind employees that their performance is being monitored, motivating them to improve and work harder.