Ishanth Edited

7/21/2019 Ishanth Edited

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PERFORMANCE

APPRAISALS


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PERFORMANCE APPRAISAL

Method of evaluating the job performance of

an employee

Ongoing process of obtaining, researching,

analyzing and recording information about

the worth of an employee


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INTRODUCTION

1

Is useful in career planning.

Plays an integral role in performance management.

Is basis for pay and promotion decisions.

Helps in correcting deficiencies and reinforcing good

performance.

2

3

4


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OBJECTIVES

MAIN OBJECTIVE

Measure and improve the performance of

employees

Increase future potential and value to the

company


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OBJECTIVES

PROVIDING FEEDBACK

Most commonjustificationfor an organization to have a PA system.

Through its PA process the individual learns exactly how well he/she

did during the previous twelve months

Can then use that information to improve his/her performance in the

future.

PA serves another important purpose by making sure that the bosss

expectations are clearly communicated.


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OBJECTIVES

FACILITATING PROMOTION

DECISIONS

Almost everyone in an organization wants to get ahead.

PA makes it easier for the organization to make good decisions to

make sure the most important positions are filled by the most

capable individuals.


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OBJECTIVES

FACILITATING LAYOFF/DOWNSIZING

DECISIONS

When economic realities force an organization to downsize, PA helps

make sure that the most talented individuals are retained and to identify

poor performers who effects the productivity of the organisation


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OBJECTIVES

ENCOURAGING

PERFORMANCE IMPORVEMENT

How can anyone improve if he doesnt know how hes

doing right now?

A good performance appraisal points out areas where

individuals need to improve their performance.


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OBJECTIVES

MOTIVATING

SUPERIOR PERFORMANCE Performance appraisal helps motivate people to deliver superior

performance in several ways.

First, the appraisal process helps them learn just what it is that the

organization considers to be superior.

Second, since most people want to be seen as superior performers, a

performance appraisal process provides them with a means todemonstrate that they actually are.

Finally, performance appraisal encourages employees to avoid being

stigmatized as inferior performers


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OBJECTIVES

SETTING & MEASURING

GOALS

The performance appraisal process is commonly used to

make sure that every member of the organization sets and

achieves effective goals.


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OBJECTIVES

COUNSELLING

POOR PERFORMERS

Not everyone meets the organizations standards.

Performance appraisal forces managers to confront those

whose performance is not meeting the companys

expectations.


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OBJECTIVES

DETERMINING

COMPENSATION CHANGES

Almost every organization believes in pay for performance

Performance Appraisal provides the mechanism to make

sure that those who do better work receive more pay.


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OBJECTIVES

ENCOURAGING

COACHING & MENTORING

Managers are expected to be good coaches to their team

members and mentors to their proteges.

Performance appraisal identifies the areas where coaching isnecessary and encourages managers to take an active

coaching role.


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OBJECTIVES

SUPPORTING MANPOWER PLANNING

Well-managed organizations regularly assess their bench

strength to make sure that they have the talent in their ranks

that they will need for the future.

Companies need to determine who and where their most

talented members are.

Performance appraisal gives companies the tool they need

to make sure they have the intellectual horsepower requiredfor the future.


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OBJECTIVES

DETERMININGINDIVIDUAL TRAINING &DEVELOPMENT NEEDS

PA identify the necessary training and development the

employee needs to close the gap between current

performance and desired performance.


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OBJECTIVES

VALIDATING

HIRING DECISIONS

Is the company hiring stars, or is it filling itself with trolls?

Only when the performance of newly hired individuals is

assessed can the company learn whether it is hiring the rightpeople.


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OBJECTIVES

PROVIDING LEGAL DEFENSIBILITY FOR

PERSONNEL DECISIONS

Almost any personnel decision(termination, denial of a

promotion, transfer to another department)can be

subjected to legal scrutiny.

If one of these is challenged, the company must be able to

demonstrate that the decision it made was not based on the

individuals race or handicap or any other protected aspect. A solid record of PAs greatly facilitates legal defensibility

when a complaint about discrimination is made.


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OBJECTIVES

IMPROVING OVERALL

ORGANIZATIONAL PERFORMANCE

A performance appraisal procedure allows the organization

to communicate performance expectations to every member

of the team and assess exactly how well each person is

doing.

When everyone is clear on the expectations and knows

exactly how he is performing against them, this will resultin an overall improvement in organizational success.


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ADDITIONAL OBJECTIVES

Review the performance of the employees

over a given period of time

Judge the gap between the actual and the

desired performance. Help the management in exercising

organizational control.

Provide feedback to the employees regardingtheir past performance.

Reduce the grievances of the employees


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PERFORMANCE APPRAISAL METHODS

1

2

3

4

5

Alternation Ranking

Graphic Rating Scale

Paired Comparison

Forced Distribution

Critical Incident

6

7

8

9

10

Behaviorally Anchored Rating scales

(BARS)

Narrative Forms

Management by Objectives (MBO)

Computerized and Web-based

Performance Appraisal

Merged Methods

APPRAISAL METHODOLOGIES


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FIGURE :

Sample Graphic

Rating Performance

Rating Form

A graphic rating scale

lists traits (such as

quality and

reliability or

teamwork) and a

range of performance

values (from

unsatisfactory to

outstanding, orbelow expectations

to role model) for

each trait


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FIGURE :One Item from an Appraisal Form Assessing Employee

Performance on Specific Job-Related Duties

This form assesses thejobsmain sets

of job-specific duties, one of which is

Maintain adequate inventory of

pizza dough.Here you would assess

how well the employee did inexercising each of these duties.


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FIGURE Appraisal Form for Assessing Both Competencies and Specific Objectives

(Section I) assesses

the employees

performancerelating to both

competencies and

objectives.

The employee and

supervisor would

fill in the objectivessection at the start

of the year, and

then assess results

and set new ones

as part of the next

appraisal.


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FIGURE Appraisal Form for Assessing Both Competencies and Specific Objectives (contd)

Some graphic

rating forms

assess several

things.

Section II

illustrates the

competenciesan

employee is

expected todevelop and

exhibit such as

identifies and

analyzes

problems

(Problem Solving),and maintains

harmonious and

effective work

relationships with

co-workers and

constituents

(Teamwork).


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FIGURE : Scale for Alternate Ranking of Appraisee

Ranking employeesfrom best to worst on a

trait or traits is another

option. Supervisors

choosing the alternation

ranking method would

use a form like this toalternately choose and

list employees who are

the highest on the

characteristic being

measured and the ones

who are the lowest.


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FIGURE 96 Ranking Employees by the Paired Comparison Method

Note:

+ means better than.

- means worse than.

- For each chart,

add up the

number of +s

in each columnto get the

highest ranked

employee.

The paired comparison method helps make the ranking method

more precise. For every trait (quantity of work, quality of work,

and so on), you pair and compare every subordinate with every

other subordinate. In the paired comparison method, you make a

chart of all possible pairs of employees for each trait.


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orced distribution method

FIGURE:

FORCEDDISTRIBUTION

CURVE

Forced ranking is a method of performance appraisal to rank employee but in order

of forced distribution

For example, the distribution requested with 10 or 20 percent in the top category, 70

or 80 percent in the middle, and 10 percent in the bottom.

The top-ranked employees are considered high-potential employees and are often

targeted for a more rapid career and leadership development programs.

In contrast, those ranked at the bottom are denied bonuses and pay increases. They

may be given a probationary period to improve their performance

APPLICATION OF FORCED RANKING

GE, Ford Motor, Conoco, Sun Microsystems, Cisco Systems, EDS, Enron and a host of

other U.S. corporations have adopted similar policies of this method


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Ex: A fire, sudden breakdown, accident

Workers Reaction scale

A Informed the supervisor immediately 5

B Become anxious on loss of output 4

C Tried to repair the machine 3

D Complained for poor maintenance 2

E Was happy to forced test 1

CRITICAL INCIDENT


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TABLE Examples of Critical Incidents for Assistant Plant Manager

CONTINUING

DUTIES

TARGETS CRITICAL INCIDENTS

Schedule productionfor plant

90% utilization of personneland machinery in plant;

orders delivered on time

Instituted new production schedulingsystem; decreased late orders by 10%

last month; increased machine

utilization in plant by 20% last month

Supervise procurement of

raw materials and on

inventory control

Minimize inventory costs

while keeping adequate

supplies on hand

Let inventory storage costs rise 15%

last month; over-ordered parts A

and B by 20%; under-ordered part

C by 30%

Supervise machinery

maintenance

No shutdowns due

to faulty machinery

Instituted new preventative

maintenance system for plant;

prevented a machine breakdown by

discovering faulty part

With the critical incident method, the supervisor keeps a log of positive and negative examples

(critical incidents) of a subordinates work-related behavior. Every 6 months or so, supervisor

and subordinate meet to discuss the latters performance, using the incidents as examples.

In Table , one of the assistant plant managers continuing duties was to supervise procurement

and to minimize inventory costs. The critical incident log shows that the assistant plant manager

let inventory storage costs rise 15%; this provides an example of what performance he must

improve in the future.


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FIGURE : APPRAISAL-COACHING WORKSHEET

All or part of the writtenappraisal may be in narrative

form as shown in Figure

The supervisors narrative

assessment aids the employee

in understanding where his orher performance was good or

bad, and how to improve that

performance.


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Be aviora y Anc ored Rating Sca e

BARS)

Developing a BARS1. Write critical incidents

2. Develop performance

dimensions

3. Reallocate incidents

4. Scale the incidents

5. Develop a final instrument

Advantages of BARS A more accurate gauge

Clearer standards

Feedback

Independent dimensions Consistency

A behaviorally anchored rating scale (BARS) is an appraisal tool that

anchors a numerical rating scale with specific examples of good or poorperformance.

Its proponents say it provides better, more equitable appraisals than do the

other appraisal tools. It takes more time to develop a BARS, but the tool has

several advantages.


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FIGURE

Example of a Behaviorally

Anchored Rating Scale for the

Dimension

Salesmanship Ski l ls

Figure presents an

example of a section of

a final BARS

instrument that lists

the critical incidents

that serve as

behavioral anchors on

the performance scalefor the dimension

Salesmanship Ski l ls.


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Management by Objectives MBO)

A comprehensive and formal organizationwide goal-setting

and appraisal program requiring:1. Setting of organizations goals

2. Setting of departmental goals

3. Discussion of departmental goals

4. Defining expected results (setting individual goals)

5. Conducting periodic performance reviews

6. Providing performance feedback

Employers use management by objectives (MBO) for one of two things.

Many use it as the primary appraisal method. Others use it to supplement

to a graphic rating or other appraisal method.MBO generally refers to the

comprehensive and formal organization wide goal-setting and appraisal

program.


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360 DEGREE PERFORMANCE APPRAISAL

360 degree measures manners and

capacities.

360 degree improves such skills as

listening, planning and goal-

setting.

360 degree concentrates on

subjective areas, for example

efficiencies of teamwork, character,

and leadership.

360 degree supplies on the way

others think about a specific staff.


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TABLE Important Advantages and Disadvantages of Appraisal Tools

Tool Advantages Disadvantages

Graphic rating scale Simple to use; provides aquantitative rating for each

employee.

Standards may be unclear; haloeffect, central tendency, leniency,

bias can also be problems.

BARS Provides behavioral anchors.

BARS is very accurate.

Difficult to develop.

Alternation ranking Simple to use (but not as simple as

graphic rating scales). Avoids

central tendency and other

problems of rating scales.

Can cause disagreements among

employees and may be unfair if

all employees are, in fact,

excellent.

Forced distribution

method

End up with a predetermined

number or % of people in each

group.

Employees appraisal results

depend on your choice of cutoff

points.

Critical incident

method

Helps specify what is right and

wrong about the employees

performance; forces supervisor to

evaluate subordinates on anongoing basis.

Difficult to rate or rank

employees relative to one

another.

MBO Tied to jointly agreed-upon

performance objectives.

Time-consuming.


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Ishanth Edited