Performance Appraisal Presented by: Nur Hasanah, SE, MSc

Performance AppraisalPresented by:Nur Hasanah, SE, MSc

Meaning •Performance appraisal is a process in

which organizations evaluate or assess their employees’ performances.

Advantages Improving employees’ performances

Compensation adjustment

Placement decisions

Showing training and development needs

Career planning and development

Staffing failure

Showing inaccurate information

Job design failure

Fairly placement

External challenges

Points to be noted 1. Managers should decide on the

objectives and purpose for the performance appraisal. Will the evaluations be for correcting problems, for determining rewards, or for other purposes? Will the evaluations be individual or group based?

2. Managers can choose between formal and informal procedures for the performance appraisal. Should the reviews be structured and occur at a specific point in time (formal), or should the manager and the subordinate discuss problems and ways to correct them as they occur (informal)?

3. Performance appraisal formats can emphasize more objectivity versus subjectivity. Should managers use their own judgements when evaluating subordinates, or should more concrete factors such as number of units produced and absenteeism be used to evaluate an employee?

4. Managers must decide on the frequency of the performance appraisals. Most often, yearly appraisals are performed. However, with the new job procedures in which feedback about performance is given monthly, daily and even hourly, perhaps less frequent formal reviews could be performed. On the other hand, if the job provides no specific feedback about performance, yearly intervals may be too long between appraisals.

5. Managers must decide who conducts the performance appraisal. Immediate supervisors are the frequent choice, but, they are by no means the only choice.

New approach of performance appraisal•360-degree feedback is the process by

which an individual’s performance is assessed through confidential feedback from supervisors, peers, subordinates, customers, and individual himself.

Performance appraisal processJob analysis

Performance standards

The performance appraisal system

Assessing performance

Performance review

Past-Oriented Performance appraisal Methods

Rating scale

Checklist

Critical incident method

Field review method

Observation and test of

performance

Group evaluation method: ranking,

grading, point allocation method

Future-oriented performance appraisal methods

Self appraisals

Psychological appraisals

MBO Assessment centers

Perceptual errors in evaluationHalo

effect Stereoty

ping

Attributions

Recency effects

Leniency/strictness

errors

Central tendency errors

Common problems with unsuccessful performance appraisal systems1. A poorly defined appraisal system2. A poorly communicated appraisal system3. An inappropriate appraisal system4. A poorly supported appraisal system5. An unmonitored appraisal system

Criteria for a successful performance appraisal system1. Construction reflects clear objectives2. Endorsement by management and

employees3. Flexibility to adapt4. Predictable timing of appraisal5. Performance dialogue6. Appropriate appraisal form7. Periodic system checks

Management guidelines1. Performance appraisals should be

based on a thorough job analysis that is current regarding both job descriptions and job specifications.

2. Performance standards should be developed from the job analysis as input into the performance appraisal.

3. Performance appraisals should evaluate a number of specific behaviors as opposed to evaluating “overall job performance” using one or a few global measures.

4. The performance review discussion should be a two-way communication between the evaluator and the employee.

5. The performance appraisal should be used not only as a means of evaluating performance but also as a means of motivating and developing the employee.

6. The purpose of the performance appraisal and the objectives of the organization must be considered carefully before deciding on a performance appraisal method.

7. In general, a successful performance appraisal system should be built around clear objectives, have the support of both management and employees, be flexible enough to adapt to organizational changes, and foster open discussions between supervisors and employees.

8. The validity of the performance appraisal system should be examined at regular intervals.