Human Resources Management

Saturday, December 4, 2021

Performance Management and Appraisal

(Session 15&16)
What is Performance Appraisal?
Performance appraisal means evaluating an employee’s current and/or past performance
relative to his or her performance standards.

Performance Appraisal Process

1. Setting work standards
2. Assessing the employee’s actual performance relative to those standards
Usually involve some rating form
3. Providing feedback to the employee

Five Reasons Why We Need to Appraise Performance

1. Used for paying, promotion, and retention decisions
2. Link performance management to company goals
3. The manager can correct deficiencies and reinforce strengths
4. With appraisals, employees can review career plans
5. Training needs are identified

Who Should do the Appraising?

1. The supervisor
2. The peers (in peer appraisals)
3. Rating committees
4. The employee themselves (self-ratings)
5. Subordinates
6. Internal and external customers

The Goals Importance

Effective appraisal goals should be SMART
- Specific
- Measurable
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Saturday, December 4, 2021
- Attainable
- Relevant
- Timely

Techniques for Appraising Performance

Graphic rating scale method
- Using scale to list a number of traits and a range of performance for each.
- Next the employee is rated by identifying the score that best describes his/her
performance level for each trait.
- Managers must decide which job performance aspect to measure.
- Some options include generic dimensions, actual job duties, or behaviorally
recognizable competencies.

Alternative ranking method

- Employees are ranked from the best to worst on a particular trait, choosing highest,
then lowest, until all the employees ranked.
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Saturday, December 4, 2021

Paired comparison method

- This method involves ranking employees by making a chart of all possible pairs of
employees for each trait and indicating which one is the better employee of the pair.

Forced distribution method

- Predetermined percentages of rates are placed in various performance categories,
which is similar to grading on a curve.
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Saturday, December 4, 2021

Critical incident method

- A supervisor keeps a record of positive and negative examples of a subordinate’s
work-related behavior and reviews the record with the employee at predetermined
times.

Narrative forms
- The method involves rating the employee’s performance for each performance factor,
writing down examples and an improvement plan, aiding the employee in
understanding where his/her performance was good or bad, and summarizing with a
focus on problem solving.

Computerized and web-based method

- Using computer and web to appraise.

Electronic performance monitoring

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Saturday, December 4, 2021
- Using electronic devices to monitor all the employees’ performances.
Behaviorally anchored rating scales (BARS)
- Method that combines the benefits of narratives, critical incidents, and quantified
scales by anchoring a scale with specific behavioral examples of good or poor
performance.
- Step of (BARS):
1. Generate critical incidents
2. Develop performance dimensions
3. Reallocate incidents
4. Scale the incidents
5. Develop a final instrument

Mixed standard scale

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Saturday, December 4, 2021
- The employer ‘mixes’ together sequentially the good and poor behavioral example
statements when listing them.
- The aim is to reduce rating errors by making it less obvious to appraiser what
performance dimensions he or she is rating and whether the behavioral example
statements represent high, medium, or low performance.

Management by objectives (MBO)

- Multistep company wide goal setting and appraisal program.
- In MBO, the manager sets specific measurable goals with each employee and then
periodically discusses the employee’s progress toward these goals.
- Steps of MBO:
1. Set the organization’s goals
2. Set departmental goals
3. Discuss departmental goals
4. Define expected results (set individual goals)
5. Conduct performance reviews
6. Provide feedbacks

Comparison of each method

Human Resources Management
Saturday, December 4, 2021