1. Performance Appraisal

2. Performance Appraisal
Performance Appraisal (PA) refers to all those procedures that are used to evaluate the
personality
performance
potential of its group members

3. Objectives of Performance Appraisal
Provide a basis for promotion/ transfer/ termination:
Identify those employees who deserve promotion
Or those who require lateral shift (transfer) or termination
PA is used for career planning

4. Objectives of Performance Appraisal
Enhance employees’ effectiveness by helping to identify their strengths and weaknesses and
Inform them about expected levels of performance
If employees understand their roles well, they are likely to be more effective on the job

5. Objectives of Performance Appraisal
Identify training and development needs:
Identifying training and development needs of employees is necessary to prepare them for meeting challenges in their current and future employment

6. Objectives of Performance Appraisal
Aid in designing training and development programs:
Identifying skills required to be developed would help in tailor- making training and development programs

7. Objectives of Performance Appraisal
Remove work alienation: Counseling Employees corrects misconceptions which might result in work alienation

8. Objectives of Performance Appraisal
Remove discontent: Identifying and removing factors responsible for workers’ discontent would motivate them for better work performance

9. Objectives of Performance Appraisal
Develop inter-personal relationships: Relations between superior - subordinate can be improved through realization that each is dependent on the other for better performance and success

10. Objectives of Performance Appraisal
Aid wage administration: Performance appraisal can help in development of scientific basis for reward allocation, wage fixation, incentives
Improve communication: Performance appraisal serves as a mechanism for communication
between superiors and subordinates

11. Process of Performance Appraisal
Establish Performance Standards
Performance standards serve as benchmarks against which performance is measured
Standards should relate to the desired results of each job

12. Process of Performance Appraisal
Communicate the Standards
Performance appraisal involves at least two parties, the appraiser who does the appraisal and the appraisee whose performance is being evaluated

13. Process of Performance Appraisal
Communicate the Standards
The appraiser should prepare job descriptions clearly; help appraisee set his goals and targets; analyse results objectively; offer coaching and guidance to appraisee whenever required and reward good results
The appraisee should be very clear about what he is doing and why

14. Process of Performance Appraisal
Measure Actual Performance
Performance measures, to be helpful must be easy to use, reliable and must report on the critical behaviors that determine performance

15. Measure Actual Performance
Performance measures may be objective or subjective
Objective performance measures are indications of job performance that can be verified by others and are usually quantitative

16. Measure Actual Performance
Subjective performance measures are ratings that are based on the personal standards or opinions of those doing the evaluation and are not verifiable by others

17. Compare Actual performance with Standards and Discuss the Appraisal
Actual performance may be better than expected and sometimes it may go off the track
Whatever be the consequences, there is a way to communicate and discuss the final outcome

18. Taking Corrective Action
Corrective action is of two types
One puts out the fires immediately
Other strikes at the root of the problem permanently

19. Performance Criteria
In order to be effective, the criteria for performance appraisal should be genuinely related to success / failure in the job and should be amenable to objective judgement
MBO is an example of performance-based appraisal approach that involves setting objectives and comparing performance against those objectives

20. Performance Criteria
Objectives give greater freedom to both management and the employees in deciding how performance is to be measured

21. Benefits of Performance Appraisal
For the appraisee
Better understanding of his role in the organization—what is expected and what needs to be done to meet those expectations
Clear understanding of his strengths and weaknesses to develop himself into a better performer in future

22. For the appraisee
Increased motivation, job satisfaction, and self-esteem
Opportunity to discuss work problems and how they can be overcome
Opportunity to discuss aspirations and any guidance, support or training needed to fulfil those aspirations
Improved working relationships with supervisors

23. Benefits of Performance Appraisal
For the Management
Identification of performers and non-performers and their development towards better performance
Opportunity to prepare employees for assuming higher responsibilities

24. For the Management
Opportunity to improve communication between the employees and management
Identification of training and development needs
Generation of ideas for improvements
Better identification of potential and formulation of career plans

25. Benefits of Performance Appraisal
For the Organization
Improved performance throughout the organization
Creation of a culture of continuous improvement and success
Conveying the message that people are valued

26. Performance Appraisal - Individual Evaluation Methods
Confidential report
Essay evaluation
Critical incidents
Checklists
Graphic rating scale
Behaviorally anchored rating scale
Forced choice method
MBO

27. Performance Appraisal - Multiple Person Evaluation Methods
Ranking
Paired comparison
Forced distribution
Other methods
Performance tests
Field review technique

28. Confidential Report Descriptive report Prepared at the end of the year
Prepared by the employee’s immediate supervisor
The report highlights the strengths and weaknesses of employees
Prepared in Government organizations
Does not offer any feedback to the employee

29. Essay Evaluation
The rater is asked to express the strong as well as weak points of employee’s behavior
The rater considers the employee’s :
Job knowledge and potential
Understanding of company’s programs, policies, objectives etc
Relation with co-workers and supervisors
Planning, organizing and controlling ability
Attitude and perception

30. Essay Evaluation This method has the following limitations:
Highly subjective
Supervisor may write biased essay
Difficult to find effective writers
A busy appraiser may write the essay hurriedly without assessing properly the actual performance of the worker
If the appraiser takes a long time it becomes uneconomical from the view point of the firm

31. Critical Incident Technique
Manager prepares lists of statements of very effective and ineffective behavior of an employee
These critical incidents represent the outstanding or poor behavior of the employees
The manager periodically records critical incidents of employee’s behavior

32. Critical Incident Technique
Example:
July 20 - Sales clerk patiently attended to the customers complaint. He is polite, prompt, enthusiastic in solving the customers’ problem
July 20 - The sales assistant stayed 45 minutes beyond his break during the busiest part of the day. He failed to answer store manager’s call thrice. He is lazy, negligent, stubborn and uninterested in work

33. Critical Incident Technique
Limitation of this technique are:
Negative incidents may be more noticeable than positive incidents.
Supervisors have a tendency to unload a series of complaints about incidents.
Results in very close supervision which may not be liked by the employee.
The recording of incidents may be a chore for the manager concerned who may be too busy or forget to do it.

34. Checklist
A checklist is a set of objectives or descriptive statements about the employee and his behavior.
Under weighted checklist, value of each question may be weighted.
Example:
Is the employee really interested in the task assigned?
Yes / No
Is he respected by his colleagues? Yes / No

35. Graphic Rating Scale
A form is used to evaluate the performance of the employees
A variety of traits may be used in this device, the most common being quality and quantity of work
Easy to understand and use.
Permits statistical tabulation of scores of employees

36. Behaviorally Anchored Rating Scale
Combination of rating scale and critical incidence
Steps:
Collect critical incidents
Identify performance dimensions
Reclassification of incidents
Assigning scale values to incidents
Producing the final instrument

37. Forced Choice Method
This method uses several sets of paired phrases, two of which may be positive and two negative
The rater is asked to indicate which of the four phrases is the most and least descriptive of a particular worker
Favorable qualities earn plus credit and unfavorable ones earn the reverse

38. Management by Objectives (MBO)
MBO emphasizes collectively set goals that are tangible, verifiable, and measurable
Focuses attention on goals rather than on methods
Concentrates on Key Result Areas (KRA)
Systematic and rational technique that allows management to attain maximum results from available resources by focusing on achievable goals

39. Key Elements Of MBO
Arranging organizational goals in a means-ends chain
Engaging in joint goal setting
This process has the following steps:
Identify KRAs
Define expected results
Assign specific responsibilities to employees
Define authority and responsibility relationship
Conducting periodic progress review
Conducting annual performance review

40. Multiple Person Evaluation Methods
Ranking method
The evaluator rates the employee from highest to lowest on some overall criteria
Paired comparison method
Each worker is compared with all other employees in a group
For several traits paired comparisons are made, tabulated and then rank is assigned to each worker
This method is not applicable when the group is large

41. Forced Distribution Methods
The rater is asked to appraise the employee according to predetermined distribution scale.
Two criteria used for rating are: job performance and promotability.
A five point performance scale is also used without mentioning any descriptive statements.
The worker is placed between two extremes of “good” and “bad” performance.

42. Group Appraisal Employee is appraised by a group of appraisers.
The group consists of
Immediate supervisor of the employee
Other supervisors who have close contact with the employee’s work.
Manager or head of the departments.
Consultants or Clients

43. Field Review Technique
The appraiser goes to the field and obtains the information about work performance of the employee by way of questioning the said individual, his peer group, and his superiors

44. 360o Appraisal System
It is a systematic collection and feedback of performance data on an individual or group, derived from a number of stakeholders
Data is gathered and fed back to the individual participant in a clear way designed to promote understanding, acceptance and ultimately behavior

45. Appraisal Interview and Feedback - Let the Employee Know Where He Stands
To help employees do a better job by clarifying what is expected of them
To plan opportunities for development and growth
To strengthen the superior-subordinate working relationship by developing mutual agreement of goals
To provide an opportunity for employees to express themselves on performance related issues