Gathering Performance Information: Overview Appraisal Forms Characteristics of Appraisal Forms Determining Overall Rating Appraisal Period and Number of Meetings Who Should Provide Performance Information? A Model of Rater Motivation Preventing Rating Distortion through Rater Training Programs Prentice Hall, Inc. © 2006

Major Components of Appraisal Forms (1) Basic Employee Information Accountabilities, Objectives, and Standards Competencies and Indicators Major Achievements and Contributions Stakeholder Input Employee Comments Signatures Prentice Hall, Inc. © 2006

Major Components of Appraisal Forms (2) (could be included in a separate form) Developmental Achievements Developmental Needs Plans Goals Prentice Hall, Inc. © 2006

Desirable Features for All Appraisal Forms Simplicity Relevancy Descriptiveness Adaptability Comprehensiveness Definitional Clarity Communication Time Orientation Prentice Hall, Inc. © 2006

Determining Overall Rating Judgmental strategy Mechanical strategy Prentice Hall, Inc. © 2006

Appraisal period Number of Meetings Annual Semi-annual Quarterly Prentice Hall, Inc. © 2006

When Review Is Completed Anniversary date Supervisor doesn’t have to fill out forms at same time Can’t tie rewards to fiscal year Fiscal year Rewards tied to fiscal year Goals tied to corporate goals May be burden to supervisor, depending on implementation Prentice Hall, Inc. © 2006

6 Types of Formal Meetings (can be combined) System Inauguration Self-Appraisal Classical Performance Review Merit/Salary Review Development Plan Objective Setting Prentice Hall, Inc. © 2006

Who Should Provide Performance Information? Employees should be involved in selecting Which sources evaluate Which performance dimensions When employees are actively involved Higher acceptance of results Perception that system is fair Prentice Hall, Inc. © 2006

Who Should Provide Performance Information? Direct knowledge of employee performance Supervisors Peers Subordinates Self Customers Prentice Hall, Inc. © 2006

Supervisors Advantages Disadvantages Best position to evaluate performance vs. strategic goals Make decisions about rewards Disadvantages Supervisor may not be able to directly observe performance Evaluations may be biased Prentice Hall, Inc. © 2006

Peers Advantages Disadvantages Assess teamwork Possible friendship bias May be less discriminating Prentice Hall, Inc. © 2006

Subordinates Advantages Disadvantages Accurate when used for developmental purposes Good position to assess some competencies Disadvantages Inflated when used for administrative purposes May fear retaliation (confidentiality is key) Prentice Hall, Inc. © 2006

Self Advantages Disadvantages Increased acceptance of decisions Decreased defensiveness during appraisal interview Good position to track activities during review period Disadvantages May be more lenient and biased Prentice Hall, Inc. © 2006

Customers (external and internal) Advantages Employees become more focused on meeting customer expectations Disadvantages Time Money Prentice Hall, Inc. © 2006

Disagreement Across Sources Expect disagreement Ensure employee receives feedback by source Assign differential weights to scores by source, depending on importance Prentice Hall, Inc. © 2006

Types of Rating Errors Intentional errors Unintentional errors Rating inflation Rating deflation Unintentional errors Due to complexity of task Prentice Hall, Inc. © 2006

A Model of Rater Motivation Expected Positive and Negative Consequences of Rating Accuracy Motivation to Provide Accurate Ratings Probability of Experiencing Positive & Negative Consequences Rating Behavior Expected Positive and Negative Consequences of Rating Distortion Motivation to Distort Ratings   Probability of Experiencing Positive & Negative Consequences

Motivations for Rating Inflation Maximize merit raise/rewards Encourage employees Avoid creating written record Avoid confrontation with employees Promote undesired employees out of unit Make manager look good to his/her supervisor Prentice Hall, Inc. © 2006

Motivations for Rating Deflation Shock employees Teach a lesson Send a message to employee Build a written record of poor performance Prentice Hall, Inc. © 2006

Prevent Rating Distortion through Rater Training Programs Prentice Hall, Inc. © 2006

Rater Training Programs should cover: Information Motivation Identifying, observing, recording and evaluating performance How to interact with employees when they receive performance information Prentice Hall, Inc. © 2006

Information - how the system works Reasons for implementing the performance management system Information on the appraisal form and system mechanics Prentice Hall, Inc. © 2006

Motivation – What’s in it for me? Benefits of providing accurate ratings Tools for providing accurate ratings Prentice Hall, Inc. © 2006

Identifying, observing, recording, and evaluating performance How to identify and rank job activities How to observe, record, measure performance How to minimize rating errors Prentice Hall, Inc. © 2006

How to interact with employees when they receive performance information How to conduct an appraisal interview How to train, counsel, and coach Prentice Hall, Inc. © 2006