An appraisal system is a way of letting your employees know what they are doing well and what they may need help with. This system should never be one where the employee is constantly torn down and told how much they need to improve the way they are operating. This would only cause tension and the employee would never want to be present for another meeting if they are constantly criticized and never shown praise.
When setting up an appraisal system you should keep in mind that you only need to address what is actually observed with the employees behavior, make sure the system is based on the rules and guidelines of the company, have only a trained superior provided the review, and always allow the employee to give feedback on what is being discussed in the meeting.
The importance of this system is to not only correct issues before they get out of control, but also to allow the employee to keep the management team on the same page with them throughout their employment with the company. If there is an issue that needs to be address then they have the opportunity to ask for help and let someone know where they feel the problem may lie.
Before you begin an appraisal meeting, you should have all the elements that need to be discussed listed and printed out, copy for both you and the employee, so that the meeting can go more smoothly. Some sample questions may be whether or not the employee feels that they have had a productive year up to that point and if not what is the reason. Another question could be what part of the job is the most difficult for you to do and why is that. By answering these questions, you not only gain insight into the employee and what they are having problems with but also where you can offer some assistance for them as well.
You could have the employee list what they feel they are above average when it comes to certain duties and where they