Tradition Method Of Performance AppraisalBy Jai Rane

Definition

•According to Newstrom, “It is the process of evaluating the performance of employees, sharing that information with them and searching for ways to improve their performance’’.

Meaning

• Performance appraisal is the step where the management finds out how effective it has been at hiring and placing employees .• A “Performance appraisal” is a process of evaluating an employee’s performance of a job in terms of its requirements.

Rating Scale

• Creating Scales Method is commonly used method for assessing the performance of the employees and well-known traditional method of performance appraisal of employees. Many corporations and companies example in the country India, telecommunications company likely airtel and US IT companies like Dell Corporation are using this method for evaluating the employees and subsequently take decisions on concerned employee.

• Depending upon the job of employee under this method of appraisal traits like attitude, performance, regularity, accountability and sincerity etc. are rated with scale from 1 to 10. 1 indicates negative feedback and 10 indicates positive feedback as shown below.

Checklist

• A checklist represents, in its simplest form, a set of objectives or descriptive statements about the employee and his behaviour. If the rater believes strongly that the employee possesses a particular listed trait, he checks the item; otherwise, he leaves the item blank. A more recent variation of the checklist method is the weighted list. Under this, the value of each question may be weighted equally or certain questions may be weighted more heavily than others. The following are some of the sample questions in the checklist.

• Is the employee really interested in the task assigned? Yes/No

• Is he respected by his colleagues (co-workers) Yes/No

• Does he give respect to his superiors? Yes/No

• Does he follow instructions properly? Yes/No

• Does he make mistakes frequently? Yes/No

Forced Distribution

The system is 17 to 18 years old, and most big organisations started waking up to this form of performance appraisal in the late '90s. The bell curve is nothing but a graphical representation of the fact that everybody's performance is not the same. Some employees will be outstanding, some average, and others at the bottom. Irrespective of whether or not the bell curve is the most appropriate representation of performance or human behaviour, some believe that it is the most viable option, especially in services-driven sectors, which have large workforces.

The system requires the managers to evaluate each individual, and rank them typically into one of three categories (excellent, good, poor). The system is thought to be relatively widely-used, but remains somewhat controversial due to the competition it creates, and also the reality that not all employees will fit neatly into one of the categories and might end up in a category that does not reflect their true performance. One of the first companies to use this system was General Electric, in the 1980s.

Critical Incident Method

• This technique of performance appraisal was developed by Flanagan and Burns.

• The manager prepares lists of statements of very effective and ineffective behaviour of an employee. These critical incidents or events represent the outstanding or poor behaviour of employees on the job. The manager maintains logs on each employee, whereby he periodically records critical incidents of the workers behaviour. At the end of the rating period, these recorded critical incidents are used in the evaluation of the workers’ performance. An example of a good critical incident of a sales assistant is the following:-

• July 20 – The sales clerk patiently attended to the customers complaint. He is polite, prompt, enthusiastic in solving the customers’ problem.

• On the other hand the bad critical incident may appear as under:

• July 20 – The sales assistant stayed 45 minutes over on his break during the busiest part of the day. He failed to answer the store manager’s call thrice. He is lazy, negligent, stubborn and uninterested in work.

Essay Method • This traditional form of appraisal, also known as “Free Form method” involves a

description of the performance of an employee by his superior. The description is an evaluation of the performance of any individual based on the facts and often includes examples and evidences to support the information. A major drawback of the method is the inseparability of the bias of the evaluator.

• Under this method, the rater is asked to express the strong as well as weak points of the employee’s behaviour. This technique is normally used with a combination of the graphic rating scale because the rater can elaborately present the scale by substantiating an explanation for his rating. While preparing the essay on the employee, the rater considers the following factors:

• Job knowledge and potential of the employee;

• Employee’s understanding of the company’s programmes, policies, objectives, etc.;

• The employee’s relations with co-workers and superiors;

• The employee’s general planning, organizing and controlling ability;

• The attitudes and perceptions of the employee, in general.

Cost Accounting Approach

• Cost accounting is a task of collecting, analysing, summarizing and evaluating various alternative courses of action. Its goal is to advise the management on the most appropriate course of action based on the cost efficiency and capability. Cost accounting provides the detailed cost information that management needs to control current operations and plan for the future.