Traditional performance appraisal systems have long been used as a mechanism for evaluating employee performance, determining compensation, and making promotion decisions. These systems were designed for relatively stable organisational environments characterized by hierarchical structures, routine work, and clearly defined job responsibilities. However, the emergence of knowledge-based organisations, digital transformation, agile work practices, remote work, and increasing emphasis on innovation have exposed significant weaknesses in traditional appraisal methods. Modern organisations require dynamic performance management systems that not only assess past performance but also facilitate employee growth, continuous learning, career development, and organisational adaptability. One of the major limitations of traditional performance appraisal systems is their excessive focus on annual or periodic evaluation. Performance is often reviewed once or twice a year, making feedback delayed and less relevant. Employees may not remember specific incidents, while managers may rely heavily on recent events rather than the employee's overall contribution. In rapidly changing business environments, annual reviews fail to provide timely guidance, making corrective actions less effective. Another limitation is the emphasis on past performance instead of future development. Traditional appraisal systems primarily evaluate what employees have already achieved rather than identifying future potential, learning needs, or career aspirations. As a result, appraisal becomes a control mechanism instead of a developmental process that supports long-term organisational capability. Subjectivity and evaluator bias also undermine the credibility of traditional appraisal systems. Managers may exhibit halo effect, horn effect, central tendency, leniency, strictness, recency bias, similarity bias, or personal prejudice. These biases distort objective assessment and create perceptions of unfairness among employees. Employees who believe that performance evaluations are biased often lose trust in management and become less motivated. Traditional appraisal systems generally focus on individual performance while ignoring teamwork, collaboration, and knowledge sharing. Knowledge-based organisations depend heavily on cross-functional collaboration, innovation, and collective problem-solving. Employees who contribute significantly to team learning or organisational knowledge may receive limited recognition if only individual output is measured. Many traditional appraisal systems rely heavily on quantitative indicators that cannot adequately capture creativity, innovation, emotional intelligence, adaptability, customer relationship management, or leadership capabilities. Knowledge workers often create value through problem-solving, innovation, mentoring, and intellectual contributions that cannot be measured solely through numerical targets. Another weakness is the limited employee participation in the appraisal process. Employees are frequently passive recipients of evaluation rather than active participants in setting goals, discussing achievements, or planning career development. This reduces ownership, accountability, and engagement while creating resistance to performance feedback. Traditional systems are also closely linked to salary increments and promotions. Since appraisal outcomes directly affect financial rewards, employees often become defensive during evaluation discussions. Managers may hesitate to provide honest developmental feedback to avoid