Self Assessment Law and Legal Definition

Self-assessment has been around since the most ancient times in the form of the admonition: Know Thyself. It emerged roughly four decades ago from work in psychology; it has been applied in that field, in medicine, and increasingly also in business. In business or professional activity, it is a tool that involves performing a critical analysis of one's own goals, interests, skills, and experience. It is also used by organizations as a self-evaluation tool. Among its many applications in the business world are employee development, team performance, and organizational change efforts. But self-assessment is perhaps most valuable for would-be entrepreneurs considering starting a new business. Are you really ready to make it on your own? Conduct a self-assessment. Future entrepreneurs, in others words, may be able to improve their chances of success in business by undertaking an honest and detailed self-assessment. By evaluating such personal traits as business skills, experience, and knowledge, financial goals, likes and dislikes, willingness to expend effort, and ability to meet challenges, entrepreneurs may be able to identify the business opportunities for which they are best suited. In some cases, self-assessment may even lead to innovative new business ideas. In addition, completing a self-assessment can help entrepreneurs recognize areas where they will need assistance or training. Increasing self-knowledge may also help entrepreneurs to attract investors and impress lenders.

A good way to start in performing a self-assessment is to prepare a detailed resume. This document should list the entrepreneur's educational background and professional experience—describing the requirements and responsibilities of each job in detail—along with hobbies and outside interests. Using the resume as a guide, it may then be helpful for the entrepreneur to separate his or her professional attributes by functional area—such as marketing, accounting, or human resource management—and assign a competency level to each one. Finally, the entrepreneur may wish to create a list of personal attributes—such as ability with numbers, common sense, communication skills, organization skills, people skills, etc.—that may be useful in starting and running a small business. The mere process of thinking about and categorizing one's skills and experience can be informative.

Not surprisingly, the tool of self-assessment can be applied to a wide variety of other business situations as well. For example, it can be used as an aid in employee development as part of a company's performance evaluation and training efforts. A common application is "360-degree feedback" systems—in addition to being evaluated by supervisors, peers, and subordinates, employees evaluate their own performance and participate in setting goals. Self-assessment can also be applied to teams of workers or even overall organizations to help identify strengths and weaknesses and improve performance. Teams might evaluate such elements of team performance as goal setting, communication, decision making, problem solving, and conflict management. At the organizational level, self-assessment performed with the participation of employees can help clarify a company's mission and goals, identify shortcomings, and generate ideas to increase competitiveness.

Self-assessment, of course, especially in discovering one's personal goals, tends to depend rather highly on the person's thoroughness, honesty, and objectivity. People tend to overlook their own shortcomings—and there is the old proverb which says: "He who is his own lawyer has a fool for a client." Edward Inderrieden and his coauthors, writing in Journal of Managerial Issues on the subject of self-appraisals refer to what they call the "leniency effect," a phrase dating to studies of self-assessment and coined in the 1980s: people "cut themselves a lot of slack." Perhaps for this reason, self-assessment is often accompanied by interaction with at least one other person who can apply some critique to the perhaps too lenient views of the assessor. In the case of the entrepreneur, a trusted but senior mentor would seem best suited for this role.


Branham, Leigh. The 7 Hidden Reasons Employees Leave: How to Recognize the Subtle Signs and Act Before It's Too Late. AMACOM, 2005.

Caffyn, Sarah. "Development of a Continuous Improvement Self-Assessment Tool." International Journal of Operations and Production Management. November 2000.

Hoag, Kevin L. Skill Development for Engineers: An Innovative Model for Advanced Learning in the Workplace. The Institution of Electrical Engineers, 2001.

Inderrieden, Edward J., Robert E. Allen, and Timothy Keaveny. "Managerial Discretion in the Use of self-Ratings in an Appraisal System: The antecedents and consequences." Journal of Managerial Issues. Winter 2004.

Muchinsky, Paul M. Psychology Applied to Work. Thomson Wadsworth, 2006.

                                 Hillstrom, Northern Lights

                                   updated by Magee, ECDI