The performance appraisal software market was valued at $2.8 billion in 2023 and is projected to reach $11.7 billion by 2032, growing at a CAGR of 17.6% from 2024 to 2032.
Performance appraisal software is a specialized tool designed to speed up the performance evaluation process of organizations. The software consistently tracks the productivity of employees, enabling organizations to offer unbiased and evident appraisals to their employees. The software further allows managers and HRs to establish performance goals, provide regular feedback, and reviews. Adoption of performance appraisal software is crucial for the success of companies as it helps to guide the employees in obtaining necessary skills, thereby enhancing overall work efficiency.
Increase in the adoption of technological advancements and surge in the requirements to automate the organizational activities are the major drivers of the performance appraisal software market. IIn addition, rise in the remote and hybrid work culture is boosting the adoption of performance appraisal software as it keeps a track of the performance of employees regardless of their geographical location. In the future, the integration of AI into HR activities is anticipated to be a dominating trend. The AI algorithm is expected to help analyze employee performance and provide customized training based on predictive analytics. The data-driven approach of AI is projected to enhance the decision-making ability of organizations, facilitating formation of employee development plans and accomplishment of business objectives.
However, the high cost of software enforcement, along with regular staff training expenses, is a major restraint of the growth of the performance appraisal software market. Moreover, there is a resistance to change from the conventional methods in the majority of the organizations, hampering the market development. Contrarily, surge in the trend of real-time inputs and emphasis on employee development is projected to present lucrative opportunities for the market. As per the reports of Gartner, an American technological research and consulting firm, approximately 70% of the total organizations are expected to change the traditional annual evaluation process and focus on consistent employee performance supervision by 2025.
Segment Review
The performance appraisal software market is segmented into enterprise size, deployment mode, and region. On the basis of enterprise size, the market is bifurcated into large enterprise and small & medium-sized enterprise. Depending on deployment mode, it is divided into on-premise, cloud-based, and web-based. Region wise, it is analyzed across North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa.
Key Findings
On the basis of enterprise size, the large enterprise segment held the highest market share in 2023.
Depending on deployment mode, the on-premise segment was the largest shareholder in 2023
Region wise, Asia-Pacific was the highest revenue generator in 2023.
Competition Analysis
The leading players operating in the global performance appraisal software market include Oracle Corporation, SAP SE, Sumtotal Systems, LLC, UKG Inc., Cornerstone OnDemand, Inc., Partner&more.com, Inc., Bamboo HR LLC, Workday, Inc., ADP, Inc., and Zoho Corporation Pvt. Ltd. These major players have adopted various key development strategies such as business expansion, new product launches, and partnerships, to strengthen their foothold in the competitive market.
Performance appraisal software is a specialized tool designed to speed up the performance evaluation process of organizations. The software consistently tracks the productivity of employees, enabling organizations to offer unbiased and evident appraisals to their employees. The software further allows managers and HRs to establish performance goals, provide regular feedback, and reviews. Adoption of performance appraisal software is crucial for the success of companies as it helps to guide the employees in obtaining necessary skills, thereby enhancing overall work efficiency.
Increase in the adoption of technological advancements and surge in the requirements to automate the organizational activities are the major drivers of the performance appraisal software market. IIn addition, rise in the remote and hybrid work culture is boosting the adoption of performance appraisal software as it keeps a track of the performance of employees regardless of their geographical location. In the future, the integration of AI into HR activities is anticipated to be a dominating trend. The AI algorithm is expected to help analyze employee performance and provide customized training based on predictive analytics. The data-driven approach of AI is projected to enhance the decision-making ability of organizations, facilitating formation of employee development plans and accomplishment of business objectives.
However, the high cost of software enforcement, along with regular staff training expenses, is a major restraint of the growth of the performance appraisal software market. Moreover, there is a resistance to change from the conventional methods in the majority of the organizations, hampering the market development. Contrarily, surge in the trend of real-time inputs and emphasis on employee development is projected to present lucrative opportunities for the market. As per the reports of Gartner, an American technological research and consulting firm, approximately 70% of the total organizations are expected to change the traditional annual evaluation process and focus on consistent employee performance supervision by 2025.
Segment Review
The performance appraisal software market is segmented into enterprise size, deployment mode, and region. On the basis of enterprise size, the market is bifurcated into large enterprise and small & medium-sized enterprise. Depending on deployment mode, it is divided into on-premise, cloud-based, and web-based. Region wise, it is analyzed across North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa.
Key Findings
On the basis of enterprise size, the large enterprise segment held the highest market share in 2023.
Depending on deployment mode, the on-premise segment was the largest shareholder in 2023
Region wise, Asia-Pacific was the highest revenue generator in 2023.
Competition Analysis
The leading players operating in the global performance appraisal software market include Oracle Corporation, SAP SE, Sumtotal Systems, LLC, UKG Inc., Cornerstone OnDemand, Inc., Partner&more.com, Inc., Bamboo HR LLC, Workday, Inc., ADP, Inc., and Zoho Corporation Pvt. Ltd. These major players have adopted various key development strategies such as business expansion, new product launches, and partnerships, to strengthen their foothold in the competitive market.
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Key Market Segments
By Enterprise Size
- Large Enterprise
- Small and Medium-sized Enterprise
By Deployment Mode
- On-premise
- Cloud-based
- Web-based
By Region
- North America
- U.S.
- Canada
- Europe
- UK
- Germany
- France
- Italy
- Spain
- Rest of Europe
- Asia-Pacific
- China
- Japan
- India
- South Korea
- Australia
- Rest of Asia-Pacific
- Latin America
- Brazil
- Argentina
- Colombia
- Rest of Latin America
- Middle East and Africa
- GCC Countries
- South Africa
- Rest of Middle East and Africa
- Oracle Corporation
- SAP SE
- Sumtotal Systems, LLC
- UKG Inc.
- Cornerstone OnDemand, Inc.
- Partner&more.com, Inc.
- Bamboo HR LLC
- Workday, Inc.
- ADP, Inc.
- Zoho Corporation Pvt. Ltd.
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Table of Contents
CHAPTER 1: INTRODUCTION
CHAPTER 2: EXECUTIVE SUMMARY
CHAPTER 3: MARKET LANDSCAPE
CHAPTER 4: PERFORMANCE APPRAISAL SOFTWARE MARKET, BY ENTERPRISE SIZE
CHAPTER 5: PERFORMANCE APPRAISAL SOFTWARE MARKET, BY DEPLOYMENT MODE
CHAPTER 6: PERFORMANCE APPRAISAL SOFTWARE MARKET, BY REGION
CHAPTER 7: COMPETITIVE LANDSCAPE
CHAPTER 8: COMPANY PROFILES
LIST OF TABLES
LIST OF FIGURES
Companies Mentioned
Key Market Players in the Performance Appraisal Software Market include:- Oracle Corporation
- SAP SE
- Sumtotal Systems, LLC
- UKG Inc.
- Cornerstone OnDemand, Inc.
- Partner&more.com, Inc.
- Bamboo HR LLC
- Workday, Inc.
- ADP, Inc.
- Zoho Corporation Pvt. Ltd.
Methodology
The analyst offers exhaustive research and analysis based on a wide variety of factual inputs, which largely include interviews with industry participants, reliable statistics, and regional intelligence. The in-house industry experts play an instrumental role in designing analytic tools and models, tailored to the requirements of a particular industry segment. The primary research efforts include reaching out participants through mail, tele-conversations, referrals, professional networks, and face-to-face interactions.
They are also in professional corporate relations with various companies that allow them greater flexibility for reaching out to industry participants and commentators for interviews and discussions.
They also refer to a broad array of industry sources for their secondary research, which typically include; however, not limited to:
- Company SEC filings, annual reports, company websites, broker & financial reports, and investor presentations for competitive scenario and shape of the industry
- Scientific and technical writings for product information and related preemptions
- Regional government and statistical databases for macro analysis
- Authentic news articles and other related releases for market evaluation
- Internal and external proprietary databases, key market indicators, and relevant press releases for market estimates and forecast
Furthermore, the accuracy of the data will be analyzed and validated by conducting additional primaries with various industry experts and KOLs. They also provide robust post-sales support to clients.
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Table Information
| Report Attribute | Details |
|---|---|
| No. of Pages | 211 |
| Published | June 2024 |
| Forecast Period | 2023 - 2032 |
| Estimated Market Value ( USD | $ 2.8 billion |
| Forecasted Market Value ( USD | $ 11.7 billion |
| Compound Annual Growth Rate | 17.6% |
| Regions Covered | Global |
| No. of Companies Mentioned | 11 |
