PERFORMANCE EVALUATION

SYSTEMS
Absolute vs Comparative

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Introduction

A performance evaluation system is an essential part of the organization because it deals

with performance ratings and feedback that lead to important business decisions related to

employees influencing organizational success. The format in which performances are rated is

also important to be determined, for years ratings format have been debated and researchers gave

priority to one format over another. Although the researchers tried to identify the most accurate

rating format the abundance of results only revealed minor differences. As a newly hired HR

director of a large manufacturing industry, it is essential to weigh the two types of performance

evaluation and select the suitable system that adds to organizational success.

Explanation and Justification

Comparative and absolute rating formats are two different types of performance

evaluation systems[ CITATION Agu19 \l 1033 ] . The lengthiest debate regarding these two formats

has been going on but there is no clear winner as of now [ CITATION Mul18 \l 1033 ] . In a

comparative system, the raters evaluate the employees in comparison to other employees. The

sub-types include a simple rating from worst to best, forced distribution, and paired comparison

rating.

On the other hand, the absolute rating format requires individuals to be rated against an

absolute standard. The sub-types include behaviorally anchored rating scales (BARS), weighted

checklist, BOS, and GRS[ CITATION Agu19 \l 1033 ]. Both types have different advantages and

disadvantages, an upper-level official responsible for applying these types of performance

evaluation systems must investigate both types carefully and compare them extensively. While

comparative systems offer advantages such as easy application, easier to explain to employees,
stimulate competition, provide quantifiable evaluation, and are less prone to errors and biases

compared to absolute methods.

The absolute methods were revealed because of the disadvantages of comparative

methods realized by many employers like Microsoft. In absolute systems, the employees are

evaluated without direct comparison to other employees[ CITATION Agu19 \l 1033 ]. These are

typically written in essay format, unstructured, some more detailed than others, and variant

depending on the writing skills of the raters. There is no quantifiable information, and these are

more complex to explain to the employees.

In a large manufacturing organization, the comparative methods are suitable because it is

easier, less time-consuming, and effective in terms of explaining and providing a clear

distinction between poor and good performance for the factory workers. However, there are

issues with the lone application of the comparative method because it provides relative ratings.

An employee might be rated as superior in a workgroup because the other employee is rated

lower, however, this same employee might be rated lower in a different workgroup because some

other employee might be rated superior although the employee’s performance did not change. In

this scenario, it is preferred that there should be an external absolute standard based on which the

employees can be evaluated.

Assessment Method

A hybrid approach towards a comparative-absolute performance evaluation system is

provided in this report. It is stated that the long-range of debate regarding comparative vs

accurate has only revealed two things. First, there are only minor differences and second, there is

no definite winner among the two[ CITATION Mul18 \l 1033 \m Roc07] . Therefore, an assessment
method that incorporates both the systems should be employed in a large organization to gain

full potential from the performance evaluation of factory workers.

There must be an absolute standard that guides the worker externally regarding the

expected good and poor behavior. The ratings can be given based on the absolute standard in

addition to the comparison with other employees. It is expected that this assessment method

would give further insight to individuals, harboring the concept of competency and the

importance of teamwork. In the manufacturing industry, the workers are expected to work with

one another, focus on comparative systems alone might create a toxic environment.

On the other hand, workers can benefit from the essays and critical feedbacks provided as

part of the comparative-absolute approach. Where employees may easily be explained regarding

their ratings, they would also be given essay feedbacks to help them improve what they lack

giving specific examples of other employees that have successfully exhibited behavior similar to

what has been predefined in the absolute standard[ CITATION Gof11 \l 1033 ].

The idea behind using a hybrid approach towards performance evaluation is to

complement the disadvantages of one method with the advantages of another. Although

comparative systems have been used in the past, the drawbacks gave way to the absolute system.

one reason includes that employees are more inclined towards absolute because it is perceived as

fair because performance criteria and behaviors are pre-defined in the rating scale [ CITATION

Roc07 \l 1033 ].

Such an assessment method is useful because it may take more time but it is more likely

to generate desired results and meet the desired goals. The workers would be rated based on

absolute standard and also be compared to other employees to provide a broader picture and
leaving less room for confusion. It should be noted that assessment methods will be selected and

modified based on the goals of the evaluation and the expected outcomes. A flexible approach is

more effective instead of selecting among the two types, the current performance management

practices also advocate for a variety of assessment methods based on different

situations[ CITATION Gof11 \l 1033 ].

Performance Management Practises in Manufacturing Industry

In literature, different forms of performance evaluation methods have been determined

such as the six sigma model, the prism, balance scorecard, rating method, and multi-criteria

model, etc. In the paper written by Narkunienė and Ulbinaitė (2018), the performance evaluation

methods are explained and compared in the light of modern vs traditional performance

evaluation methods. It is noted that there is no single performance evaluation method that can be

suited to all organizations; thus, the assessment method should be chosen based on the needs of

the organization and the aim of the evaluation[ CITATION Nar18 \l 1033 ].

The performance management practices in the manufacturing industry are found to use a

variety of assessment methods and evaluation techniques like balance scorecard, performance

prism, checklist method, and others based on different goals such as organization success,

customer satisfaction, employee evaluation and to solve different business problems [ CITATION

Ben19 \l 1033 ].

Conclusion

The performance evaluation method is an integral part of any large organization,

selecting the suitable assessment method is a difficult task that required careful examination. The

debate regarding comparative vs absolute systems reveals minor differences and a never-ending
battle between the two. An intelligent approach thus could be the combination of the two systems

resulting in a variety of assessment methods that can be swapped and chosen based on the

organizational aims and evaluation goals. A hybrid approach is beneficial for large organizations

because it provides flexibility, effectiveness, and efficiency.

References
Aguinis, H. (2019). Performance Management For Dummies. John Wiley & Sons,.

Benati, I., & Coccia, M. (2019). Comparative Performance Systems: An Assessment. (A. Farazmand, Ed.)
Global Encyclopedia of Public Administration, Public Policy, and Governance,.

Goffin, R. D., & Olson, J. M. (2011). Is It All Relative? ComparativeJudgments and the Possible
Improvementof Self-Ratings and Ratings of Others. Perspectives on Psychological Science, 6(1),
48–60.

Mullins, J. T. (2018). Motivating Emissions Cleanup: Absolute vs. Relative Performance Standards.
Journal of Environmental Economics and Management, 91, 66-92.

Narkunienė, J., & Ulbinaitė, A. (2018). Comparative analysis of company performance evaluation
methods. Entrepreneurship and Sustainability Issues, 6(1), 125-138.

Roch, S. G., Sternburgh, A. M., & Caputo, P. M. (2007). Absolute vs Relative Performance Rating Formats:
Implications for fairness andorganizational justice. International Journal of Selection and
Assessment, 15(3).