Performance Appraisal. Performance Appraisal (PA) refers to all those procedures that are used to evaluate the Performance Appraisal (PA) refers to all

Performance AppraisalPerformance Appraisal

Performance AppraisalPerformance Appraisal

Performance Appraisal (PA) refers to all those Performance Appraisal (PA) refers to all those

procedures that are used to evaluate theprocedures that are used to evaluate the

personalitypersonality

performanceperformance

potential of its group memberspotential of its group members

Objectives of Performance AppraisalObjectives of Performance Appraisal

Provide a basis for promotion/ transfer/ termination: Provide a basis for promotion/ transfer/ termination:

Identify those employees who deserve promotionIdentify those employees who deserve promotion

Or those who require lateral shift (transfer) or Or those who require lateral shift (transfer) or

termination termination

PA is used for career planningPA is used for career planning


Enhance employees’ effectiveness by helping to

identify their strengths and weaknesses and

Inform them about expected levels of performance

If employees understand their roles well, they are

likely to be more effective on the job


Identify training and development needs:

Identifying training and development needs of employees

is necessary to prepare them for meeting challenges in

their current and future employment


Aid in designing training and development programs:

Identifying skills required to be developed would help

in tailor- making training and development programs


Remove work alienation: Counseling Employees corrects

misconceptions which might result in work alienation


Remove discontent: Identifying and removing factors

responsible for workers’ discontent would motivate

them for better work performance


Develop inter-personal relationships: Relations between

superior - subordinate can be improved through

realization that each is dependent on the other for better

performance and success


Aid wage administration: Performance appraisal can help

in development of scientific basis for reward allocation,

wage fixation, incentives

Improve communication: Performance appraisal serves as

a mechanism for communication

between superiors and subordinates

Process of Performance AppraisalProcess of Performance Appraisal

Establish Performance Standards

Performance standards serve as benchmarks against

which performance is measured

Standards should relate to the desired results of each

job


Communicate the StandardsCommunicate the Standards

Performance appraisal involves at least two Performance appraisal involves at least two

parties, the appraiser who does the appraisal and parties, the appraiser who does the appraisal and

the appraisee whose performance is being the appraisee whose performance is being

evaluatedevaluated


Communicate the StandardsCommunicate the Standards

The appraiser should prepare job descriptions clearly; The appraiser should prepare job descriptions clearly;

help appraisee set his goals and targets; analyse help appraisee set his goals and targets; analyse

results objectively; offer coaching and guidance to results objectively; offer coaching and guidance to

appraisee whenever required and reward good resultsappraisee whenever required and reward good results

The appraisee should be very clear about what he is The appraisee should be very clear about what he is

doing and whydoing and why


Measure Actual PerformanceMeasure Actual Performance

Performance measures, to be helpful must be Performance measures, to be helpful must be

easy to use, reliable and must report on the easy to use, reliable and must report on the

critical behaviors that determine performancecritical behaviors that determine performance


Performance measures may be objective or Performance measures may be objective or

subjectivesubjective

Objective performance measures are Objective performance measures are

indications of job performance that can be indications of job performance that can be

verified by others and are usually quantitativeverified by others and are usually quantitative


Subjective performance measures are ratings Subjective performance measures are ratings

that are based on the personal standards or that are based on the personal standards or

opinions of those doing the evaluation and are opinions of those doing the evaluation and are

not verifiable by othersnot verifiable by others

Compare Actual performance with Compare Actual performance with Standards andStandards and Discuss the AppraisalDiscuss the Appraisal

Actual performance may be better than expected Actual performance may be better than expected

and sometimes it may go off the trackand sometimes it may go off the track

Whatever be the consequences, there is a way to Whatever be the consequences, there is a way to

communicate and discuss the final outcomecommunicate and discuss the final outcome

Taking Corrective ActionTaking Corrective Action

Corrective action is of two typesCorrective action is of two types

One puts out the fires immediately One puts out the fires immediately

Other strikes at the root of the problem Other strikes at the root of the problem

permanentlypermanently

Performance CriteriaPerformance Criteria

In order to be effective, the criteria for performance In order to be effective, the criteria for performance

appraisal should be genuinely related to success / failure appraisal should be genuinely related to success / failure

in the job and should be amenable to objective in the job and should be amenable to objective

judgementjudgement

MBO is an example of performance-based appraisal MBO is an example of performance-based appraisal

approach that involves setting objectives and comparing approach that involves setting objectives and comparing

performance against those objectivesperformance against those objectives

Performance CriteriaPerformance Criteria

Objectives give greater freedom to both Objectives give greater freedom to both

management and the employees in deciding management and the employees in deciding

how performance is to be measuredhow performance is to be measured

Benefits of Performance AppraisalBenefits of Performance Appraisal

For the appraiseeFor the appraisee

Better understanding of his role in the Better understanding of his role in the

organization—what is expected and what needs organization—what is expected and what needs

to be done to meet those expectationsto be done to meet those expectations

Clear understanding of his strengths and Clear understanding of his strengths and

weaknesses to develop himself into a better weaknesses to develop himself into a better

performer in futureperformer in future

For the appraiseeFor the appraisee

Increased motivation, job satisfaction, and self-Increased motivation, job satisfaction, and self-

esteemesteem

Opportunity to discuss work problems and how Opportunity to discuss work problems and how

they can be overcomethey can be overcome

Opportunity to discuss aspirations and any Opportunity to discuss aspirations and any

guidance, support or training needed to fulfil guidance, support or training needed to fulfil

those aspirationsthose aspirations

Improved working relationships with supervisorsImproved working relationships with supervisors


For the ManagementFor the Management

Identification of performers and non-performers Identification of performers and non-performers

and their development towards better performanceand their development towards better performance

Opportunity to prepare employees for assuming Opportunity to prepare employees for assuming

higher responsibilitieshigher responsibilities

For the ManagementFor the Management

Opportunity to improve communication between Opportunity to improve communication between

the employees and managementthe employees and management

Identification of training and development needsIdentification of training and development needs

Generation of ideas for improvementsGeneration of ideas for improvements

Better identification of potential and formulation Better identification of potential and formulation

of career plansof career plans


For the OrganizationFor the Organization

Improved performance throughout the Improved performance throughout the

organizationorganization

Creation of a culture of continuous improvement Creation of a culture of continuous improvement

and successand success

Conveying the message that people are valuedConveying the message that people are valued

Performance Appraisal - Individual Performance Appraisal - Individual Evaluation MethodsEvaluation Methods

Confidential reportConfidential report

Essay evaluationEssay evaluation

Critical incidentsCritical incidents

ChecklistsChecklists

Graphic rating scaleGraphic rating scale

Behaviorally anchored rating scaleBehaviorally anchored rating scale

Forced choice methodForced choice method

MBOMBO

Performance Appraisal - Multiple Performance Appraisal - Multiple Person Evaluation MethodsPerson Evaluation Methods

RankingRanking

Paired comparisonPaired comparison

Forced distributionForced distribution

Other methodsOther methods

Performance testsPerformance tests

Field review techniqueField review technique

Confidential ReportConfidential Report

Descriptive report Descriptive report

Prepared at the end of the yearPrepared at the end of the year

Prepared by the employee’s immediate supervisorPrepared by the employee’s immediate supervisor

The report highlights the strengths and The report highlights the strengths and

weaknesses of employeesweaknesses of employees

Prepared in Government organizationsPrepared in Government organizations

Does not offer any feedback to the employeeDoes not offer any feedback to the employee

Essay EvaluationEssay Evaluation

The rater is asked to express the strong as well The rater is asked to express the strong as well

as weak points of employee’s behavioras weak points of employee’s behavior

The rater considers the employee’s :The rater considers the employee’s : Job knowledge and potentialJob knowledge and potential

Understanding of company’s programs, policies, Understanding of company’s programs, policies,

objectives etcobjectives etc

Relation with co-workers and supervisorsRelation with co-workers and supervisors

Planning, organizing and controlling abilityPlanning, organizing and controlling ability

Attitude and perceptionAttitude and perception

Essay EvaluationEssay Evaluation

This method has the following This method has the following

limitations:limitations: Highly subjectiveHighly subjective Supervisor may write biased essaySupervisor may write biased essay Difficult to find effective writersDifficult to find effective writers A busy appraiser may write the essay hurriedly A busy appraiser may write the essay hurriedly

without assessing properly the actual performance without assessing properly the actual performance

of the workerof the worker If the appraiser takes a long time it becomes If the appraiser takes a long time it becomes

uneconomical from the view point of the firmuneconomical from the view point of the firm

Critical Incident TechniqueCritical Incident Technique

Manager prepares lists of statements of very Manager prepares lists of statements of very

effective and ineffective behavior of an employeeeffective and ineffective behavior of an employee

These critical incidents represent the outstanding These critical incidents represent the outstanding

or poor behavior of the employeesor poor behavior of the employees

The manager periodically records critical The manager periodically records critical

incidents of employee’s behaviorincidents of employee’s behavior

Critical Incident Technique Critical Incident Technique

Example:Example:

July 20 - Sales clerk patiently attended to the July 20 - Sales clerk patiently attended to the

customers complaint. He is polite, prompt, customers complaint. He is polite, prompt,

enthusiastic in solving the customers’ problementhusiastic in solving the customers’ problem

July 20 - The sales assistant stayed 45 minutes July 20 - The sales assistant stayed 45 minutes

beyond his break during the busiest part of the day. beyond his break during the busiest part of the day.

He failed to answer store manager’s call thrice. He is He failed to answer store manager’s call thrice. He is

lazy, negligent, stubborn and uninterested in worklazy, negligent, stubborn and uninterested in work

Critical Incident Technique Critical Incident Technique

Limitation of this technique are:Limitation of this technique are:

Negative incidents may be more noticeable than positive Negative incidents may be more noticeable than positive incidents.incidents.

Supervisors have a tendency to unload a series of Supervisors have a tendency to unload a series of complaints about incidents.complaints about incidents.

Results in very close supervision which may not be liked by Results in very close supervision which may not be liked by the employee.the employee.

The recording of incidents may be a chore for the manager The recording of incidents may be a chore for the manager concerned who may be too busy or forget to do it.concerned who may be too busy or forget to do it.

ChecklistChecklist

A checklist is a set of objectives or descriptive A checklist is a set of objectives or descriptive

statements about the employee and his behavior.statements about the employee and his behavior.

Under weighted checklist, value of each question may Under weighted checklist, value of each question may

be weighted.be weighted.

Example:Example:

Is the employee really interested in the task assigned?Is the employee really interested in the task assigned?

Yes / NoYes / No

Is he respected by his colleagues?Is he respected by his colleagues? Yes / NoYes / No

Graphic Rating ScaleGraphic Rating Scale

A form is used to evaluate the performance of the A form is used to evaluate the performance of the

employeesemployees

A variety of traits may be used in this device, the A variety of traits may be used in this device, the

most common being quality and quantity of workmost common being quality and quantity of work

Easy to understand and use.Easy to understand and use.

Permits statistical tabulation of scores of employeesPermits statistical tabulation of scores of employees

Behaviorally Anchored Rating ScaleBehaviorally Anchored Rating Scale

Combination of rating scale and critical Combination of rating scale and critical

incidenceincidence

Steps: Steps:

Collect critical incidentsCollect critical incidents

Identify performance dimensionsIdentify performance dimensions

Reclassification of incidentsReclassification of incidents

Assigning scale values to incidentsAssigning scale values to incidents

Producing the final instrumentProducing the final instrument

Forced Choice MethodForced Choice Method

This method uses several sets of paired phrases, two This method uses several sets of paired phrases, two

of which may be positive and two negativeof which may be positive and two negative

The rater is asked to indicate which of the four phrases The rater is asked to indicate which of the four phrases

is the most and least descriptive of a particular workeris the most and least descriptive of a particular worker

Favorable qualities earn plus credit and unfavorable Favorable qualities earn plus credit and unfavorable

ones earn the reverseones earn the reverse

Management by Objectives (MBO)Management by Objectives (MBO)

MBO emphasizes collectively set goals that are MBO emphasizes collectively set goals that are

tangible, verifiable, and measurabletangible, verifiable, and measurable

Focuses attention on goals rather than on methodsFocuses attention on goals rather than on methods

Concentrates on Key Result Areas (KRA)Concentrates on Key Result Areas (KRA)

Systematic and rational technique that allows Systematic and rational technique that allows

management to attain maximum results from management to attain maximum results from

available resources by focusing on achievable goalsavailable resources by focusing on achievable goals

Key Elements Of MBOKey Elements Of MBO

Arranging organizational goals in a means-ends Arranging organizational goals in a means-ends

chainchain Engaging in joint goal settingEngaging in joint goal setting

This process has the following steps:This process has the following steps: Identify KRAsIdentify KRAs Define expected resultsDefine expected results Assign specific responsibilities to employeesAssign specific responsibilities to employees Define authority and responsibility relationshipDefine authority and responsibility relationship

Conducting periodic progress reviewConducting periodic progress review Conducting annual performance reviewConducting annual performance review

Multiple Person Evaluation MethodsMultiple Person Evaluation Methods

Ranking methodRanking method The evaluator rates the employee from highest to The evaluator rates the employee from highest to

lowest on some overall criterialowest on some overall criteria

Paired comparison methodPaired comparison method Each worker is compared with all other employees in a Each worker is compared with all other employees in a

groupgroup

For several traits paired comparisons are made, For several traits paired comparisons are made,

tabulated and then rank is assigned to each workertabulated and then rank is assigned to each worker

This method is not applicable when the group is largeThis method is not applicable when the group is large

Forced DistributionForced Distribution MethodsMethods

The rater is asked to appraise the employee according to The rater is asked to appraise the employee according to

predetermined distribution scale.predetermined distribution scale.

Two criteria used for rating are: job performance and Two criteria used for rating are: job performance and

promotability.promotability.

A five point performance scale is also used without A five point performance scale is also used without

mentioning any descriptive statements.mentioning any descriptive statements.

The worker is placed between two extremes of “good” The worker is placed between two extremes of “good”

and “bad” performance.and “bad” performance.

Group Appraisal Group Appraisal

Employee is appraised by a group of Employee is appraised by a group of

appraisers.appraisers.

The group consists of The group consists of

Immediate supervisor of the employeeImmediate supervisor of the employee

Other supervisors who have close contact with the Other supervisors who have close contact with the

employee’s work.employee’s work.

Manager or head of the departments.Manager or head of the departments.

Consultants or Clients Consultants or Clients

Field Review Technique Field Review Technique

The appraiser goes to the field and obtains the The appraiser goes to the field and obtains the

information about work performance of the information about work performance of the

employee by way of questioning the said employee by way of questioning the said

individual, his peer group, and his superiorsindividual, his peer group, and his superiors

360360o o Appraisal SystemAppraisal System

It is a systematic collection and feedback of It is a systematic collection and feedback of

performance data on an individual or group, performance data on an individual or group,

derived from a number of stakeholders derived from a number of stakeholders

Data is gathered and fed back to the individual Data is gathered and fed back to the individual

participant in a clear way designed to promote participant in a clear way designed to promote

understanding, acceptance and ultimately behaviorunderstanding, acceptance and ultimately behavior

Appraisal Interview and Feedback - Let Appraisal Interview and Feedback - Let the Employee Know Where He Standsthe Employee Know Where He Stands

To help employees do a better job by clarifying what To help employees do a better job by clarifying what

is expected of themis expected of them

To plan opportunities for development and growthTo plan opportunities for development and growth

To strengthen the superior-subordinate working To strengthen the superior-subordinate working

relationship by developing mutual agreement of goalsrelationship by developing mutual agreement of goals

To provide an opportunity for employees to express To provide an opportunity for employees to express

themselves on performance related issuesthemselves on performance related issues

Documents

Performance Appraisal. Performance Appraisal (PA) refers to all those procedures that are used to evaluate the Performance Appraisal (PA) refers to all