Performance Appraisal

Concept Of Performance Appraisal

• PA is the method of evaluating the

behavior of the employees in the job it

includes both quantitative and

qualitative aspects of job performance.

Purpose Of Performance Appraisal

• Compensation Decision- Pay raise

• Promotion decision- level raise

• Training and development programmes-

Enhance performance

• Personal development- self actualization

need

Performance Appraisal Process

• Establish performance standard

• Communicate the standard

• Measure Actual performance

• Compare actual performance with

standards performance

• Take corrective actions

What is to be appraised?

1. Behaviour of the employee -for eg :

Doctor’s behaviour with the patient.

2. Objectives of the organization- market

share , profit contribution, strategy

alignment.

3. Traits in performing the job- the

precision, time taken by the employee

to perform any job.

Who will appraise?

• Supervisors

• Peers

• Subordinates

• Self appraisal

METHODS OF PA

The PA method are of 15 types-

• Individual Evaluation method- This is done by

individual employee

• Group evaluation Method- one employee is

compared with others

• Modern methods- these are new methods and

research is still carried on

Performance Appraisal method

IndividualEvaluation

method

Group evaluation

Method

Modern methods

1. Confidential report2. Essay evaluation3. Critical incident technique4. Check list5. Graphic rating scale6. BARS7. Forced choice method

1. Ranking2. Paired comparison3. Forced distribution

1. Group Appraisal2. HRA3. Assessment centre4. Field review

Individual Evaluation method

1. Confidential Report- • Used in Government organisations• Prepared at the end of the year.• Done by immediate senior• Strength and weaknesses of

employee are taken• Impression based• No feedback is offered

Individual Evaluation method

2. Essay Evaluation- • It’s a non quantitative subjective analysis• Strong and weak points of employee are rated.• Parameters are-i) Understanding of programmes, policies,

objectives etcii) Job knowledgeiii) The employees relations with coworkers and

superiorsiv) The employee general ability of planning,

controlling, organizing etc.v) General perception of the employee

Individual Evaluation method

3. Critical Incident technique- • The manager prepares the lists of

statements of every effective and ineffective behaviour of the employee.

• These rated incidents represents the outstanding or poor behaviour of the employee.

• The manager maintains the log book wherein the critical incidents are reported periodically and considered at the time of appraisal.

Individual Evaluation method

4. Checklists:• A checklist is the set of objectives or

descriptive statements about the employee and his behaviour.

• The rater marks the characteristics which employee possess rest are kept blank.

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

Individual Evaluation method

5. Graphic rating scale-• A printed form is used to evaluate the

performance of the employee .• A variety of traits are judged on the scale

and summarised.• For eg: Knowledge of job- Clear

understanding of the factors connected with the job rated on a scale unsatisfactory, fair, satisfactory, good, outstanding.

Individual Evaluation method

6. BARS- Behaviourally Anchored Rating Scale• The critical incidents are selected and rated on the

scale which has 6-8 defined performance dimension.

• Process of Implementing BARS-i) Collect critical incidentsii) Identify performance dimensioniii) Reclassification of Incidentsiv) Assigning scale values to the incidentsv) Producing the final instrument

Individual Evaluation method

7. Forced Choice Method-• This method makes use of several

sets of paired phrases. Two which are positive and two are negative. The rater has to rate as least applicable most applicable.

• The phrases are non uniformally divided so the chances of biases are not apparent

Individual Evaluation method

8. MBO (Management by objective)-• This technique emphasises on the goals

which are tangible, verifiable, measurable.• It’s a six stepped process-I) Set departmental goalsII) Discuss departmental goalsIII) Define expected resultsIV) Performance reviewV) Provide feedback

Group Evaluation Method

1. Ranking method-

• The relative position of each employee is expressed in terms of his numerical rank.

Group Evaluation Method

2. Paired comparison method-

• Each worker is compared with all other employees in the group , for every trait , the worker is compared with all other employees.

Group Evaluation Method

3. Forced Distribution Method-

• A predetermined distribution scale.

• Two criteria are used for rating are the job performance and promotability.

• Five point scale is used for descriptive statements.

MODERN METHOD

1. Group Appraisal-

• Employee appraised by group of appraiser

• It is a bias free method

MODERN METHOD

2.Human Resource Accounting:

The HRA process shows the investment the organisation makes I its people and how the value of these people change over time. The acquisition cost of employee is compared to the replacement cost from time to time.

• 2.

MODERN METHOD

3.Field review method-

Here the HR department representative goes to the field and assist line supervisors .

MODERN METHOD

4. 360 Degree feedback system-

The system involves overall appraisal of the employees . All the employees are part of te performance appraisal.

Biases in Performance Appraisal

• First impression

• Halo effect

• Horn effect

• Leniency

• Central tendency

• Stereotyping

• Recency effect