Evaluating faculty effectiveness is important in institutions of higher education. Although evaluation is inherently threatening to most faculty members, the vast majority take their assignments seriously and want to conduct them as effectively as possible. Assessing faculty performance is a complex and time-consuming process. If it is done poorly or insensitively, it can have an adverse effect on institutional quality. Whether or not individual institutions elect to commit the resources required for valid evaluations depends on the degree to which they agree with these propositions: (1) all members of the institution should be accountable for their activities and performance; (2) the conduct and use of credible evaluation programs have an important influence on the welfare and future excellence of the individual, the department, and the institution; and (3) when improvement efforts are supported by institutional policy and guided by comprehensive and valid appraisals of current functioning, the well-being of the individual and the institution are affected positively. (Contains 18 references.) (SLD)