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    Session 10:: Performance Appraisal & Potential

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    Sharmishtha Rajak
    The document discusses performance appraisals, which involve formally assessing employees annually. The objectives are to set goals, evaluate performance, identify training needs, reward performance, and improve it. The appraisal process involves determining standards, measuring performance against them, conducting evaluations, and communicating results. Appraisers traditionally included supervisors, but now also include self, peers, subordinates and customers. Traditional and modern appraisal methods are outlined. Problems with ratings like bias are discussed, as well as improving accuracy. The ethics, interviews, forced distributions, uses and assessing potential are also covered.

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    Session 10:: Performance Appraisal & Potential

    Uploaded by

    Sharmishtha Rajak
    33 views15 pages
    The document discusses performance appraisals, which involve formally assessing employees annually. The objectives are to set goals, evaluate performance, identify training needs, reward performance, and improve it. The appraisal process involves determining standards, measuring performance against them, conducting evaluations, and communicating results. Appraisers traditionally included supervisors, but now also include self, peers, subordinates and customers. Traditional and modern appraisal methods are outlined. Problems with ratings like bias are discussed, as well as improving accuracy. The ethics, interviews, forced distributions, uses and assessing potential are also covered.

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    The document discusses performance appraisals, which involve formally assessing employees annually. The objectives are to set goals, evaluate performance, identify training needs, reward performance, and improve it. The appraisal process involves determining standards, measuring performance against them, conducting evaluations, and communicating results. Appraisers traditionally included supervisors, but now also include self, peers, subordinates and customers. Traditional and modern appraisal methods are outlined. Problems with ratings like bias are discussed, as well as improving accuracy. The ethics, interviews, forced distributions, uses and assessing potential are also covered.

    Copyright:

    © All Rights Reserved
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    Download as pptx, pdf, or txt
    33 views15 pages

    Session 10:: Performance Appraisal & Potential

    Uploaded by

    Sharmishtha Rajak
    The document discusses performance appraisals, which involve formally assessing employees annually. The objectives are to set goals, evaluate performance, identify training needs, reward performance, and improve it. The appraisal process involves determining standards, measuring performance against them, conducting evaluations, and communicating results. Appraisers traditionally included supervisors, but now also include self, peers, subordinates and customers. Traditional and modern appraisal methods are outlined. Problems with ratings like bias are discussed, as well as improving accuracy. The ethics, interviews, forced distributions, uses and assessing potential are also covered.

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    You are on page 1of 15

    Session 10:

    Performance & Potential


    Appraisal

    Praxis Business School, Kolkata


    HCM | Jan-Mar 2019 1 / 15
    Concept of Performance Appraisal
    Performance appraisal is a formal assessment and rating of individuals by their managers
    at – usually – an annual review meeting. The objectives of Performance Appraisal are:
    Objective Remarks
    1. Setting targets and goals as Performance standards and specific goals are set at the
    performance standards beginning of the appraisal period. These targets motivate
    the employee to perform better.
    2. Evaluating employee performance The evaluation of employee performance helps
    understand the strengths and weaknesses of the
    employee. This evaluation also helps to determine the
    achievement of pre-set goals and targets.
    3. Identifying training and development An employee’s areas of weakness are also the areas for
    needs improvement or development. These are the
    shortcomings in the individual’s performance, which need
    to be improved upon.
    4. Rewarding performance Rewarding a good performer and punishing a bad one
    encourages employees to perform better. As has been
    stated in the reinforcement theory, behaviour is a function
    of its consequences.

    5. Improving performance Once the strengths and weaknesses are identified, the
    employees can be encourages to overcome his
    weaknesses and leverage his strengths to optimize his
    2 / 15
    performance.
    The Appraisal Process
    Determination of standards of performance
    Step 1 based on the organizational objectives and the
    job description.

    Measurement of employee performance


    Step 2
    against the pre-determined goals and
    standards.

    Step 3 Actual process of measurement.

    Step 4 Communicating the results of appraisal to the


    employee concerned
    Who are the appraisers?

    Traditionally, appraisal has been the job of the supervisor with


    the employee himself having no role to play in the process.
    However, the whole concept has changed today and the
    appraisee has an important role in the process.
    In a 360 degree feedback process, the feedback can be provided
    by:
     Self-appraisal
    Many employers use Rating
     Supervisors Peers Committees to evaluate
    employees, especially when
     Customers/Clients the employee performs a
    variety of tasks in different
     Subordinates environments under different
     supervisors
    Performance Appraisal Methods

    Traditional Methods Modern Methods


     Management by  Behaviorally Anchored
    Objectives or goal-setting Rating Scale (BARS)
     Graphic rating scale  360 degree Performance
    Appraisal
     Work standards approach
     Team Appraisals
     Essay appraisal
     Balanced Scorecard
     Critical incidents method
    Method
     Forced choice rating
    method
     Point allocation method
     Ranking methods
     Checklist
    Examples of
    Rating charts
    Example
    of BARS
    Problems of Rating
     Leniency or Severity  Stereotyping
     Central Tendency  Recency Effect
    Effect  Primacy Effect
     Halo Effect  Perceptual Set
     Spillover Effect  Fundamental
     attribution error
    Status Effect

    Factors that help improve accuracy: Factors that may low er accuracy:
    1 Ratings based on observation of 1 Ratings done as pa rt of administrative
    actual performance exercise
    2 Documented behaviours to improve 2 Raters unable to express himself honestly
    recall and unambiguously
    3. Usage of checklists 3. Rater unaware of causes of rating errors
    4. Awareness of personal biases 4 Rater tends to rec all behaviours selectively
    5 Comparison and benchmarking of and only to improve his own rating
    ratings 5 Performance factor s are unrelated to the job
    6. Management accountability of ratings and / or poorly defined

    7. Performance factors are well-defined 6 Rater tends to infl ate ratings when the
    ratees receive scor es
    Appraisal Interview
    The appraisal interview plays a prominent role in the success
    of a performance appraisal system. A well-designed appraisal
    system also needs to be implemented well.

    Challenges of appraisal interview:


     The organizational culture
     the relationship between the employee and his boss
     the maturity level of the individuals
     An apprehensive employee
     A wary appraiser
     A biased appraiser
     Inexperience
    Ethics of Performance Appraisal
    Every performance management system needs the support of
    the top management and the acceptance of the workforce for
    its success.

    Removing “intentional” errors from the appraisal process:


     Making the ratings more measurable and quantifiable
     Reducing subjectivity by using multi-rater feedback
     Using instruments/methods which have hidden weights or
    keys attached to them
     Having the feedback evaluated by a third party like the HR
    department
     Training appraisers on how to provide negative feedback
    Forced Distribution of Performance

    Forced distribution method seeks to overcome the problem of leniency by
    compelling the rater to distribute the overall ratings on all points of the scale
    representing a “bell curve”

    Forced distribution of performance ensures high performers are adequately
    differentiated and recognized, and low performers (deadwood) are periodically
    weeded out.
    Number of Employee

    5% 10% 60% 20% 5%


    Unsatisfactory Below Average Good Excellent
    Average


    Major weakness of the forced distribution method lies in the assumption that the
    employee performance levels always conform to a normal (or some other)
    distribution. Organisations that have done a good job in selecting talented
    workforce during it’s growth phase, the forced distribution often leads to
    reduction in employee morale .
    Uses of Performance Appraisal
     Training and development needs of  Cross-functional transfers and job
    the employees can be determined enrichment exercises etc. can be
    taken up, based on inputs from the
     Organizational effectiveness can be appraisal system.
    improved by improving the individual
    performance of the employees  Human resources of the firm can be
    evaluated based on the competency
     The performance appraisal system and skill set and potential of the
    forms the basis for compensation workforce. This provides the base for
    management in the organization, in human resource planning
    addition to other methods like market
    surveys.  An assessment of the value of the
    human resources helps in
     Can be used as basis for transfers, organizational planning.
    promotions and other career planning
    activities of individual employees, and  The performance appraisal system also
    even for determining termination. helps in evaluating and auditing the
    existing plans, processes and systems
     An effective performance appraisal in the organization.
    system also helps in succession
    planning in the organization
    Assessing Potential
    Yearly performance appraisal process leads to the process of
    assessing the employee’s potential to contribute to the
    organisation’s progress in medium to longer term. The Philips
    Model below shows the four categories of employees:
    High

    Problem Child Star Performers


    Potential

    Question Mark Solid Citizens


    Low

    (Planned Separation?)

    Low High

    Performance
    Talent Review Grid Example
    Legal Issues Associated with Performance
    Appraisal
    The appraisal system is a common target of legal disputes by employees involving
    charges of unfairness and bias. An employee may seek legal recourse to obtain relief
    from a discriminatory performance appraisal. Few recommendations for developing a
    fair and legally defensible performance appraisal system is mentioned below:

    1. Legally defensible appraisal Procedures:


     All personnel decisions should be based on formal, uniform and
    standardised performance appraisal system; Formal appeal process
    2. Legally defensible appraisal Content:
     Objectively verifiable performance data, and job related performance
    dimensions should be used; avoid appraisals based on traits
    3. Legally defensible Documentation of Appraisal Results:
     A thorough, written record of evidence of performance appraisal
    ratings and improvement actions should be maintained, especially
    while leading to termination decision
    4. Legally defensible Raters:
     Only trained raters who have the opportunity to observe the
    performer first-hand should be allowed to do performance rating;
    more than one rater should be used preferably to reduce bias

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