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7/17/2019 Performance Appraisal
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Performance Management
Performance Appraisal
7/17/2019 Performance Appraisal
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o Performance• degree of accomplishment by the individual in his
job.
oAppraisal• judgments of characteristics, trait and performance
of others.
2
Performance +
Appraisal
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o Compensation decisions:-• It can serve as a basis for pay raises.
• This approach to compensation should be given formerit rather than seniority.
o Promotion decision:-• It can serve as a useful basis for job change or
promotion.
3
Objective
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o Training and development programmes:-• It serve as a guide for formulating a suitable training
and development progamme. It can tell employeeshat s!ill they have to develop.
o Feedback:-• PA enables the employees to !no ho ell he is
doing on the job. It helps him to go up the"organi#ational ladder$.
o Personal development:-• PA helps to reveal the causes of good and poor
employee performance and help them to improvetheir performance
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– Processes used to identify, encourage,measure, evaluate, improve, and reardemployee performance
• Provide information to employees about theirperformance.
• %larify organi#ational performance e&pectations.
• Identify the development steps that are needed toenhance employee performance.
• 'ocument performance for personnel actions.
• Provide reards for achieving performanceobjectives
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o (hat do (e )valuate*
o (ho ill Appraise*
o (hen to appraise*
+
uestion Arises
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Individual tas! out comesfocus on the result of or! behaviour
ehaviours
behaviors e&hibited by employee hile e&ecuting the job
Traits
-ocus on the personal characteristic of employees suchas the ability to arrive at decision ,loyalty ,communication s!ill
"at is to be Appraised
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(ho Performs theAppraisal*
• Immediate/upervisor
• 0igher
Management• /elf1Appraisals
• Peers %o1(or!ers
• )valuation Teams• %ustomers
• 43+56 Appraisals7
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• The appraiser may be any person ho has thorough!noledge about the job content, contents to beappraised, standards of contents and ho observesthe employees hile performing job.
• 0e should prepare reports and ma!e judgmentsithout bias.
T#pical appraisers are:-
• $upervisors:-Include superiors of the employees, other superiorshaving !noledge about the or! of the employees
and departmental head or managers.
8
!"o %ill Appraise
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• Peers :-
Peer appraisal may be reliable if the or! group isstable over a reasonably long period of time andperforms tas! that re9uire interaction.
• $ubordinates:-
/uperiors rated by subordinates is being used inmost organi#ation today. This method can be useful ifthe relationship beteen superiors and subordinatesare cordial. This method is useful in identifying
competent superiors.• $elf appraisal:-
If individuals understand the objectives they aree&pected to achieve and the standards by hich they
are to be evaluated, they are in a best position to:5
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Performance appraisal
• Evaluating an employee’s current and/or past
performance relative to his or her performance
standard
• Setting work standards
• Assessing employees actual performance
• Providing feed back to the employees
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(hy appraise Performance*
• Promotional decisions
• Correcting deficiencies /reinforce positives
• Career planning purpose• Training and development needs
• Performance management process
• P!S " Source of the current employeeinformation
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Primary ;ses of PerformanceAppraisals
SmallOrganizations
LargeOrganizations
AllOrganizations
Compensation #$%& ''(& ()*&
Performanceimprovement
)'+& ,++& )#)&
Feedback )$+& )$'& )$)&
Documentation %*$& +%%& +$%&
Promotion %'-& %%#& %)#&
Training ,-& *)& (+&
Transfer #-& '-& (+&Discharge )*& '(& ,'&
Laoff %-& %#& %)&
Personnel research -#& %#& %%&
!anpo"er planning $(& %#& -,&
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Three parts of PM/
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Model of PM in orgIndividual attributes
<rgstrategy
=ong term> short
term gals
/ituationalconstraints
<rg culture)conomiccondition
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Performance AppraisalProcess
• /elect performance factors based on job description to beevaluated and set the standards to be achieved
• /et the performance revie period
• Measure actual performance
• %ompare performance ith set standards and rate it ithsuitable scale
• %ommunicate the rating to the appraise
• ;se the performance appraisal for the desired purpose
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Performance Appraisal Process)&ternal )nvironmentInternal )nvironment
Identify Specific
Performance Appraisal
Goals
Establish Performance
Criteria (Standards) and
Communicate Them ToEmployees
Examine Wor Performed
Appraise the !esults
"iscuss Appraisal #ith
Employee
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Performance measures
criteria
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Performance measures criteria
• Strategic congruence
• .alidity
• eliability• Acceptability
• specificity
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/trategic congruence
• The e0tent to which P!S elicits 1ob
performance that is congruent with the
organi2ations strategy
• Eg? A drug company hose businessstrategy is to penetrate in the @
.American mar!et for 'ermatologycompounds. ma&imi#e theeectiveness of B> ' ,
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validity
The e&tent to hich a performance measureassesses all the relevant Cand only therelevant Caspect of performance
The performance measure is deDcient if it
does not measure all aspects of performanceA contaminated measure evaluates
irrelevant aspect of performance or aspectsthat are not job related
• %ontent validity %ontamination
'eDciency
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Beliability
• The degree to hich performancemeasure is free from random error
•
• Befers to the consistency of aperformance measure
• Inter rater reliability
• Internal consistency reliability
• Test1retest reliability
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Acceptability
• The e&tent to hich a performancemeasure is deemed to be satisfactoryor ade9uate by those ho use it
• )&tent to hich the employeesbelieve the PM/ is fair
• Perceived fairness procedural
interpersonal
<utcome fairness
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/peciDcity
• The e0tent to which a performance measure
tells employees what is e0pected of them and
how they can meet these e0pectation
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Approaches to measuring
Performance
Methods
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Individual)valuation Method
o Con&dential'eporto (ssa# (valuationo Critical )ncidentso C"ecklistso *rap"ic 'ating$caleo e"aviorall#Anc"ored 'ating$cales
o Forced C"oice,et"od
Multiple1person)valuation Methods
o 'ankingo PairedComparisono Forced
istribution
<ther Methods
o *roup Appraisalo .'Ao AssessmentCentreo Field 'evie%
P('FO',A/C(
APP'A)$A0 ,(T.O$
2+
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Approaches to measuring
Performance
• The comparative approach
• The attribute approach• The behavioral approach
• The results approach
• The 9uality approach
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%omparative approach
Ban!ing
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:.Ban!ing Methods
• )mployees are ran!ed from the bestto orst
• Ban!ing can be relatively easy andine&pensive
• It may be aected rater bias
• There may be little dierence bEemployees ran!ed
• 'iFcult to ran!ing individuals hen alarge number of persons are rated
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2.Paired comparison
Ascompared to
A B C
A + -
B + +
C - +
As compared
to A B C
A - +
B + +
C - +
• )ach employee is compared everytrait ith all the other persons inpairs one at a time
• Guality of or! leadership
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3.-orced 'istribution Methods
• ;ses ran!ing format, but employeesare ran!ed in groups
• 'istribute the ratings in to normal
fre9uency distribution
• -or e&le, the distributionre9uested ith :5 or 25 percent in the
top category, 5 or H5 percent in themiddle, and :5 percent in the bottom.
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The attribute approach
• :.raphic Bating /cale
• 2.Mi&ed standard scale
•3.%hec! =ist• J.)ssayEfree form appraisal
• K.%onDdential Beports
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:.Trait Methods
• The e&tend to hich employeespossess traits or characteristics L
• Measures various characteristics li!edependability, creativity, initiative,,leadership LL
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:.Trait Methods
• :.raphic Bating /calesElinear rating scale
• most commonly used method
• of the oldest methods of evaluation in use
• a printed form, is used to evaluate
• easy to understand, easy to use
• and permits a statistical tabulation of
scores of employees• Permits many employees to be 9uic!ly
evaluated
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'rabac!
• /ubjectivity > lo reliability
• 'escriptive ords often used in scalemay have dierent meaning todierent raters
• is that each characteristic is e9uallyimportant in evaluation of the
employee$s performance
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K.%hec!list Methods
• Another simple type of individualevaluation method is the chec!list
• a set of objectives or descriptivestatements about the employee andhis behavior
• A rating score from the chec!list
helps the manager in evaluation ofthe performance of the employee
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• assign biased eights to the 9uestions.
• e&pensive and time consuming.
• diFcult for the manager to assemble,analy#e and eigh a number of
statements about the employee$scharacteristics, contributions andbehaviors.
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%hec! =I/T
• @ame of theemployeeLL.'esignLL..
• :.Is the employee punctual in attending the
oFce* E@• 2.Is the employee sincere in doing his job *
E@
• 3. 'oes he ma!e mista!es fre9uently* esE@o
LLLLLLLLLLLLLLLLLLL.• LLLLLLLLLLLLLLLLLLLLLL
• LLLLLLLLLLLLLLLLLLLLLL.
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+.)ssayEfree form appraisal
• /hort essay describing eachemployee$s performance during therating period
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H.%onDdential report
• mostly used in governmentorgani#ations
• It is a descriptive report prepared,
• generally at the end of every year,
• by the employee$s immediatesuperior.
• The report highlights the strengthsand ea!nesses of the subordinate
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The behavioral approach
• Measures the employee behaviorals!ills
• :.%ritical Incident Method
• 2.AB/E)/
•3.</• J.<M
• K.Assessment centers
ehaviorally anchored rating
scales AB/ehavioral observation scales</ehavioral e&pectation scales)/
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:.%ritical Incident Method
• %ontinuous appraisal methods
• ased on critical performance areasof the job
• the manager prepares lists ofstatements of very eective andineective behavior of an employee.
• These critical incidents or eventsrepresent the outstanding or poorbehavior of employees on the job.
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)gLLLLLLLL..
• July 20 – The sales clerk patiently attended tothe customers complaint. He is polite, prompt,enthusiastic in solving the customers’ problem.
•
• n the other hand the bad critical incident mayappear as under!
• July 20 – The sales assistant stayed "# minutesover on his break during the busiest part o$ theday. He $ailed to ans%er the store manager’scall thrice. He is la&y, negligent, stubborn anduninterested in %ork
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2.AB/ehaviorally Anchored Bating /cale
%onsists of a series of scales created by?
• Identifying important job dimensions
• %reating statements describing a
range of desired and undesirablebehaviors anchors
• Also !non as the behavioral e&pectations scale,
• uilds on the critical incidents approach
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How to construct BARS?
• $tep 1: Collect critical incidents!
• $tep 2: Identify performancedimensions.
• technical competence, relationships %ith customers,
handling o$ paper %ork and meeting day'to'day deadlines.
• $tep 3: Reclassication of
incidents• $tep 4: Assigning scale values to
the incidents:
• $tep 5: roducing the nal
J h i <b ti
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J.ehavior <bservation/cale
• Appraiser plays the role of observer rather than a judge
• Bather than discarding a large number of the bhvrs
that e&emplify eective or ineective performance
• Bather than assessing hich behaviour bestreNects an individual$s performance ,</ re9uires
managers to rate the fre9uency ith hich theemployee has e&hibited each behavior during therating period
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56Organi7ational be"aviour modi&cation
• Managing the bhvr of employees through a formalsystem of behavioral feedbac! and reinforcement
86Assessment centers
The process in hich multiple raters evaluateemployees performance on a number of e&ercises
=eaderless group discussion, role plays in bas!ete&ercises
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Besult approach
• :.M<
• 2.Productivity measurement>evaluation system ProM)/
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Besult
• )valuate employee performance basedon accomplishments they achieve
• /ales turnover
• @umber of units produced• @o of customers served
• /ubjectivity can be eliminated from themeasurement process
• %losest indicator of one$s contribution toorgani#ational eectiveness
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Management y <bjective M<
• Philosophy of managementthat rates performance onthe basis of employee
achievement of goals setby mutual agreement ofemployee and manager.
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Management y <bjective M<'ouglas Mc regor
• top mgt team Drst deDnes thecompany$s strategic goals for thecoming year
• These goals are passed on to thene&t layer of management , these
managers deDne the goals they mustachieve for the company to reach itsgoals
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M<
• M< represents a modern method ofevaluating the performance ofpersonnel
• Processes here by the superior andsubordinate managers of an org
jointly identify its common goal,
• deDne each individual "s major areasof responsibility in terms of resultse&pected of him
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Productivity measures OProM)/
• ased on the ratio of output theyturned out to the input they used
• @umber of clients served per year
• Measurement of all !inds of outputas ell as all !inds of input ould bediFcult
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The 9uality approach
• )mphasi#e an assessment of both person andsystem factors in the measurement system
• )mphasis that managers and employees or!
together to solve performance problem
• Involve both internal and e&ternal customers insetting standards and measuring performance
• ;se multiple source to evaluate person andsystem factors
3+5 ' P f A i l
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3+5 'egree Performance Appraisal
• ()0 *egree +er$ormance. %ombination ofself, peer, supervisor, and subordinateperformance evaluation
• 389 refers to t"e 389 degrees in acircle
• Comes from all sources around t"eemplo#ee
• 6
The 3+5Q Appraisal
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The 3+5Q AppraisalIntervie
#ndividualStaff
Self-Assessment
Supervisor
Other Superiors
Peers
Teams
Sub$Ordinates
Teams
Customers
Other Superiors
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C"aracteristics of a good s#stem
• :.AnonymityEconDdential
• 2.<bservation of employee performance
• 3.feed bac! interpretation
• J.-ollo1up
• K.;sed for developmental purpose only
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)rror of %entral Tendency
• Performance1ratingerror in hich allemployees are rated
about average.
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=eniency or /trictness )rror
• Performance1rating error inhich the appraiser tendsto give employees either
unusually high orunusually lo ratings.
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Becency )rror
• Performance1ratingerror in hich theappraisal is based
largely on theemployee$s mostrecent behavior ratherthan on behaviorthroughout theappraisal period.
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/imilar1To1Me )rror
• Performance1ratingerror in hich anappraiser inNates the
evaluation of anemployee because ofa mutual personalconnection.
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4Performance appraisal is not
merely for appraisal but is for
accomplishment 3 improvement of performance4
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'iscuss the role of PerformanceAppraisal in human resource
'evelopment