Are performance appraisals a step towards management by objectives?discuss with the help of example?

I believe the statement in the question is not quite
correct. The term performance appraisal generally applies to the appraisal of the
performance of a person by another person, generally the supervisor. This is done
primary for the purpose of taking decision such as increments, and promotions. These
increments and rewards play an important part in motivation of the employees appraised.
In contrast, management by objective is a system of motivation based on the every
employee being motivated by a set of objective set for the employee, rather than the
promise of any reward associated with actual performance against the
objectives.

Also when we examine the relationship between
the objectives and performance appraisal, the objectives should be set before
performance appraisal is undertaken. This permits more meaningful evaluation of
performance.

All that we can say in support of the
statement that "

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Performance appraisal is a step toward Management
by Objective (MBO).

is that
the concept of MBO has been developed as an improvement over the performance appraisal
system as a means for motivating employees. Here it should be noted that MBO is not just
about using objectives for self-motivation for employees. It is also a method of
developing objectives for individual members of the managers in an organization that
maximizes the achievement of total organizational objectives.