PERFORMANCE APPRAISAL

Performance Appraisal Defined System of review and evaluation of job performance Assesses accomplishments and evolves plans for development

Performance Management Process that significantly affects organizational success Managers and employees work together to set expectations, review results and reward performance.

Purposes of Performance Mangement Strategic Aligning employee performance with organizational objectives Administrative Making employment-related decisions Developmental Aiding employee growth

Appraiser Discomfort Performance appraisal process cuts into manager’s time Experience can be unpleasant when employee has not performed well

Rationale for Performance Appraisal Employee Anxiety Creates anxiety for appraised employee Rationale for Performance Appraisal Provides legal and other benefits for employers

Designing a performance management system Conduct job analysis Set performance standards Appraise performance Feedback information to employee

Establish Performance Criteria Traits Behaviors Competencies Goal Achievement Improvement Potential

Responsibility for Appraisal Immediate supervisor Subordinates Peers Rationale for evaluations conducted by team members Self-appraisal Customer appraisal

360-Degree Valuation Multi-rater evaluation Input from multiple levels with firm and external sources Focuses on skills needed across organizational boundaries More objective measure of performance Process more legally defensible

Performance Measure Standards Strategic congruence Reliability Validity Acceptability Specificity

The Appraisal Period Prepared at specific intervals Usually annually or semiannually Period may begin with employee’s date of hire All employees may be evaluated at same time

Appraisal categories and types Comparative Ranking (Simple, alternation) Forced distribution Paired comparison Attribute Graphic rating scale Behavioral Critical incidents BARS BOS Results MBO Quality

Problems in Performance Appraisal Lack of objectivity Halo error Leniency/strictness Central tendency Recent behavior bias Personal bias Manipulating the evaluation

Reasons for Intentionally Inflating or Lowering Ratings Inflating Ratings Lowering Ratings Believe accurate ratings would have a damaging effect on subordinate’s motivation and performance. Improve employee’s eligibility for merit raises. Avoid airing department’s “dirty laundry.” Avoid creating negative permanent record that might haunt employee in the future. Protect good workers whose performance suffered because of personal problems. Reward employees displaying great effort even when results were relatively low. Avoid confrontation with hard-to-manage employees. Promote a poor or dislike employee up and out of the department. Scare better performance out of an employee. Punish a difficult or rebellious employee. Encourage a problem employee to quit. Create a strong record to justify a planned firing. Minimize the amount of merit increase a subordinate receives. Comply with an organizational edict that discourages managers from giving high ratings.

Characteristics of an Effective Appraisal System Job-related criteria Performance expectations Standardization Trained appraisers Continuous open communication Performance reviews Due process

Legal Implications With enactment of Americans with Disabilities Act and civil rights legislation, employers must prepare for more discrimination lawsuits and jury trials related to performance appraisals

The Appraisal Interview Scheduling the interview Interview structure Use of praise and criticism Employees’ role Use of software Concluding the interview