Performance Management and Appraisal Chapter 8 Performance Management and Appraisal Explain the purpose of performance appraisal. Answer the question, “Who should do the appraising?” Discuss the pros and cons of at least eight performance appraisal methods. Give examples of five potential appraisal problems. Explain how to conduct an appraisal feedback interview. Explain how to install a performance management program. Illustrate examples of segmenting and actively managing a company’s talent.

Basic Concepts in Performance Management and Appraisal Performance Appraisal Evaluating an employee’s current and/or past performance relative to his or her performance standards Why appraise performance?

Basic Concepts in Performance Management and Appraisal The continuous process of identifying, measuring, and developing the performance of individuals and teams and aligning their performance with the organization’s goals.

Basic Concepts in Performance Management and Appraisal The Appraisal Process Setting work standards Provide feedback Define the job Comparing the Employees’ Performance to the standards

Basic Concepts in Performance Management and Appraisal What to Appraise (performance criteria)? Defining the Employee’s Goals and Performance Standards 1 2 Performance, Competencies, and Achievements Quantitative Qualitative Mix Traits and behavior Observable Non-observable

Basic Concepts in Performance Management and Appraisal How to Setting Effective Goals and Objectives (Standards)? Using MBO perspective – SMART goals and objectives (SMARTER) 1 Assign specific goals 2 Assign measurable goals 3 Assign challenging but doable goals 4 Encourage participation Talent management: Basing appraisal standards on required competencies The role of job descriptions

Who Should Do the Appraising? 1 The immediate supervisor 2 Peer appraisals 3 Rating committees 4 Self rating 5 Appraisal by subordinates 6 360 Degree feedback 7 Crowd appraisals

Appraisal Methods 1 Graphic rating scale method 2 Alternation ranking method 3 Paired comparison method 4 Forced distribution method 5 Critical incident method 6 Narrative forms

Appraisal Forms in Practice: Merging the Methods Appraisal Methods 7 Behaviorally anchored rating scales (BARS) 8 Management by objectives / Results based systems 9 Computerized and web based performance appraisal 10 Electronic performance monitoring Appraisal Forms in Practice: Merging the Methods Conversation Days

Dealing with Appraisal Problems and the Appraisal Interviews Potential Appraisal Problems 1 Unclear standards 4 Leniency or strictness 2 Halo effect 5 Bias 3 Central tendency 6 Initial impressions / Last impressions Ensure Fairness and Effective Supervision Avoid the Middle Clarify Standards Addressing Legal Issues in Appraisal Avoid Bias Avoid Halo Effect Ratings Don’t Be Lenient or Strict

Dealing with Appraisal Problems and the Appraisal Interviews Handling the Appraisal Interview 1 Preparing for the appraisal interview 2 Conducting the interview Building Your Communications Skills 1 Pay attention 2 Make yourself clear 3 Be an active listener

Dealing with Appraisal Problems and the Appraisal Interviews Performance Management Versus Performance Appraisal 1 Continuous, daily, or weekly interactions and feedback to ensure continuous improvement 2 It is always goal-directed 3 Continuously re-evaluating and (if need be) modifying how the employee and team get their work done Using Information Technology to Support Performance Management

Talent Management Practices and Employee Appraisal Appraising and Actively Managing Employees Segmenting and Actively Managing Employees in Practice