Performance Appraisal

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Performance Appraisal :

Performance Appraisal (PA) refers to all those procedures that are used to evaluate the personality, performance, potential, of its group members

Question arises?

Why do we measure performance? Effective performance appraisal

systems How do we measure performance?

Characteristics It is a step by step process It examine the employee strengths and

weaknesses Scientific and objective study Ongoing and continuous process Secure information for making correct

decisions on employees

Appraisal Benefits Appraisals offer

employees: Direction Feedback Motivation

Appraisal Benefits Appraisals offer the company:

Documentation Employee Development Feedback Legal protection Motivation system

Why Appraisals Are Important

•Recognize accomplishments•Guide progress•Improve performance

Why Important (cont.)

Review performance Set goals Identify problems Discuss career advancement

Steps in performance appraisal

Establishing job standards

Designing an appraisal programme

Appraise performance

Performance interview

Use appraisal dataFor appropriate purpose

Process of PASetting

performancestandardsTaking corrective

standards

Discussingresults

Comparing standards

Measuringstandards

Communicatingstandards

Issues in appraisal system

Appraisal Design?

Formal and informal

Whose performance?

Who are the raters?

What problems?

How to solve?

What to evaluate?

When to evaluate?

What methods?

How PA contribute to firm’s competitive advantages Improving

performance

Making correct decision

Ensuring legal competence

Minimizing dissatisfactionAnd turnover

Values and behavior

Competitive advantage

Problems in performance appraisal

1. Errors In rating Halo effects Stereotyping Central tendency Personal bias

Set Goals…. Based on job requirements Realistic Measurable Observable Challenging

During the Meeting

Review performance: Based on previous goals Noting strengths and accomplishments Identifying areas for improvement

End the Meeting Encourage good performance Lay out action plan Communicate outcome of goals not

met Confirm understanding

Continuous Feedback Formal appraisals Informal appraisals Open communication

Recognize Good Performance

Verbal Public Tangible Monetary

Performance Appraisal Methods Individual Evaluation Methods

Confidential report Essay evaluation Critical incidents Checklists Graphic rating scale Behaviorally anchored rating scale MBO

Critical Incident methodEx: A fire, sudden breakdown, accident

Workers reaction scale

A informed the supervisor immediately 5B Become anxious on loss of output 4C tried to repair the machine 3D Complained for poor maintenance 2E was happy to forced test 1

Checklist method

•Simple checklist method•Forced choice method

Simple checklist method:Is employee regular Y/NIs employee respected by subordinate Y/NIs employee helpful Y/NDoes he follow instruction Y/NDoes he keep the equipment in order Y/N

Forced choice method

Criteria Rating

1.Regularity on the job Most Least•Always regular•Inform in advance for delay•Never regular•Remain absent•Neither regular nor irregular

Graphic Rating Scale• Continuous Rating Scale

Employee name_________ Deptt_______Rater’s name ___________ Date________------------------------------------------------------------------------

Exc. Good Acceptable Fair Poor 5 4 3 2 1 _

DependabilityInitiativeOverall outputAttendanceAttitudeCooperationTotal score Continuous Rating Scale

BARS( behaviorally Anchored rating scale)

Step 1. Identify critical incidents

Step 2. Select performance dimension

Step 3. Retranslate the incidents

Step 4. Assign scales to incidents

Step 5. Develop final instrument

MBO Process Set organizational goals Defining performance target Performance review feedback

Group Appraisal Ranking Paired comparison Performance tests Field review

technique

Performance Appraisal Methods (cont.)

Ranking method

Employee Rank

A 2

B 1

C 3

D 5

E 4

Paired comparison methodAppraiser compares each employee with every other employee , one at a time.

For ex:

there are 5 employees A,B,C,D,ESo the performance of a will A compared with B & decision will be taken on whose performance is better…then A is compared with rest all one by one.

Field review methodPerformance subordinate peers superior customerDimension

Leadership ^ ^

Communication ^ ^

Interpersonal skills ^ ^

Decision making ^ ^ ^

Technical skills ^ ^ ^

Motivation ^ ^ ^

Performance criteria for executives For top managers

Return on capital employed Contribution to companies development Degree of growth and expansion of

employees

For middle level managers Departmental performance Coordination among employees Degree of clarity about corporate goals and

policies Achievement of standards

For supervisors Quality and quantity of output in a given period Labor cost per unit of output in a given period Material cost per unit in a given period Rate of absenteeism and turnover of employees No of accidents in a given period