Performance Appraisal Team 9 Niina Saarinen Helen Jiang Miia Wahlroos Laura Malin

Agenda What Performance Appraisal Is? Purposes Development of Appraisal Program Training of Appraisers Implementation Appraisal Interviews Conclusions

What Performance Appraisal Is? Evaluation of the employees Many different methods Not a punitive process Linked to company goals

Administrative Purposes Compensation HR functions: promotion, transfer, layoff HR planning “Paper trail” Influences employee behavior => improves organizational performance

Developmental Purposes Eliminate problems New goals Training needs Individual development –Feedback and discussions –Possibility to improve job performance, not only evaluate past

Performance Standards Strategic relevance Criterion deficiency Criterion contamination Reliability

Development of the Program Organizational chart Cultural characteristics of BP-Centro General rating methods Sample items of appraisal form

Cultural Characteristics Appraisal - an unfamiliar concept –Traditionally only hard facts measured –Qualitative sides neglected Finns tend to be discrete –Avoid negative feedback –Seldom discuss personal traits Russians and Baltics are different from Finns

General Rating Methods Trait Approaches –Graphic rating-scales –Mixed-standard scales –Forced-choice forms –Essay method Results Methods –Management by objectives (MBO)

General Rating Methods cont. Behavioral Methods –Critical incident rating –Behavioral checklist –Behaviorally anchored rating scale (BARS) –Behavioral observation scales (BOS)

Sample Items General skills Management/Leadership skills Management SkillsActualRequested by position Comments ________ -Planning ________ -Organization ________ -People development ________ -Decision making ________ -Control ________ Ranking A B C D E

Training of Appraisers Explain the objectives Define the standards Avoid misunderstanding Reduce biases Using the form –Scales and rankings –Comments serve as references for interview

Implementation CEO Country and functional mangers Regional, facility and assistant facility managers

CEO Appraisal Annually –Self-appraisal –HQ –Functional managers –Country managers Semi-annually –MBO

MBO A philosophy of management that has employees establish objectives through consultation with their superiors and then uses these objectives as basis for evaluation.

MBO Requirements Co-operation Objectives easily quantifiable The employees can control the process and outcome Consistent goals Review times specified

MBO Advantages Mutual goal setting Reward and promotion decisions Objectives defined Performance improved Co-operation improved

MBO Disadvantages Time consuming Costly Some goals difficult to measure Hard to get full commitment

Functional and Country Managers Annually –Self-appraisal –360-degree appraisal Semi-annually –MBO

Regional, Facility and Assistant Facility Managers Annually –Self-appraisal –360-degree appraisal

360-Degree Method Appraisal by manager and/or supervisor Subordinates Peers (teams) Customers

360-Degree Advantages Comprehensive system Quality of information Lessens bias/prejudice Complements TQM Increases employee self-development

360-Degree Disadvantages Administratively complex Feedback can be intimidating Conflicting opinions Invalid evaluations

To Ensure Quality and Acceptance Assure anonymity Use statistical procedures Identify and quantity biases Make respondents accountable Prevent “gaming” of the system => Training

Appraisal Interview Training the interviewers Data analyzing –HR department Face to face conversations –Feedback –Training needs

Conclusion Highly related with compensation plan Successful appraisal program can eliminate the misunderstandings between employees It helps employee improve their future performance It guarantees the achievement of company’s goals.

Thank You for Your Attention! Questions?