Performance Appraisal Software Market By Enterprise Size (Large Enterprise, Small and Medium-sized Enterprise) , By Deployment Mode (On-premise, Cloud-based, Web-based) : Global Opportunity Analysis and Industry Forecast, 2024-2032
Performance Appraisal Software Market
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 ReviewThe 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 FindingsOn 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 AnalysisThe 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.
Key Market SegmentsBy Enterprise SizeLarge Enterprise
Small and Medium-sized Enterprise
By Deployment ModeOn-premise
Cloud-based
Web-based
By RegionNorth 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
Key Market Players
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.