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In this tutorial, Vision 10 shares a methodology for designing an effective appraisal form, emphasizing the importance of understanding competencies and KPIs. Competencies, defined as the ability to perform tasks, consist of three elements: attitude, knowledge, and skills, while KPIs (Key Performance Indicators) represent performance results. To create a solid appraisal form, one must document the significance of each competency and KPI. The speaker uses the example of a sales manager to illustrate how these concepts apply in the appraisal process. Understanding the distinctions between competencies and KPIs is crucial before designing a new appraisal form.