1. PERFORMANCE APPRAISAL
Chapter 12
PERFORMANCE APPRAISAL

2. Chapter Outcomes
Describe the three purposes of the performance appraisal.
Differentiate formal and informal performance appraisals.
Describe key legal concerns in performance appraisals.
Identify the three most popular sets of criteria that supervisors appraise.
Contrast absolute and relative standards.
List human errors that can distort performance appraisal ratings.
Describe what is meant by term 360-degree appraisal.
Describe the purpose of employee counseling.

3. Performance appraisal defined
A review of past performance that emphasizes positive accomplishments as well as deficiencies; a means for helping employees improve future performance.

4. Performance appraisers
Supervisor
Peers
Self

5. Review guidelines Prepare for and schedule the appraisal
Create a supportive environment
Describe the purpose of the appraisal
Involve the employee in the appraisal
Focus discussion on work behaviors
Support evaluation with specific examples
Provide positive feedback and feedback for improvement
Ensure that employees understand what was discussed
Generate a development plan

6. Legality
Performance appraisal policies set forth in organizational handbooks are increasingly construed as a binding unilateral contract.
Do everything possible to avoid the appearance of prejudice and discrimination.

7. Absolute-standards measurements
Written essays
Critical incidents
Checklists
Adjective rating scales (see page 302)
Behaviorally Anchored Rating Scales (BARS)

8. Relative standards
Group-order ranking
Individual ranking

9. Objectives
Objectives must be:
Tangible
Verifiable
Measurable

10. EXHIBIT 12–2
Sample items from a checklist appraisal form.

11. EXHIBIT 12-3
Example of adjective rating scale items.

12. Sample BARS for an employee relations specialist.
EXHIBIT 12–4
Sample BARS for an employee relations specialist.
Source: Reprinted from Business Horizons, August Copyright 1976 by The Foundation for the School of Business at Indiana University.

13. EXHIBIT 12–5
Group-order ranking distribution.

14. Potential problems in performance appraisals
Leniency error
Halo error
Similarity error
Recency error
Central tendency error
Inflationary pressures

15. Overcoming hurdles Continually document employee performance
Use behaviorally-based measures
Combine absolute and relative standards
Use multiple raters
Rate selectively
Participate in appraisal training
Conduct performance appraisals of teams

16. EXHIBIT 12–6
The counseling process.