Should I include the employee’s successes and failures in completing the development plan as part of his formal performance appraisal?
No. Development is development—it’s not job performance. Giving someone a high performance appraisal rating because that person completed an important and challenging development plan (while missing several important performance expectations) is as unfair as gigging someone whose performance made the whole department shine be- cause he sacrificed his development plan to turn in that outstanding performance.
Keep performance and development separate.