It is important to the employee to understand what he or she is to give and to get. Talk to most employees, and they will say management doesn't evaluate or does a poor job of it. On a basic human level, people don't like to be evaluated themselves, so they tend not to like evaluating others. Many managers view the process itself as threatening and leading to conflict on interpersonal and organizational levels. One way to reduce potential conflict is to avoid it.
Evaluations tend to be an unexamined part of the corporate culture.
They aren't seen as contributing to the company's bottom line. Because of this, neither management nor employees tend to take them seriously. If employee evaluations are tied to upward mobility in the organization, they can create competition among employees. This also can lead to a centralizing tendency in which everyone gets a three or four on a five-point scale. The recency effect, in which employees are judged on what they did last week instead of last year or last quarter.