Human Resource Management

Course Code: MGT350

Dr. Imran Shafique

 Lecture Outline
1. Performance Appraisal System

A. Performance Appraisal

B. Determinants and Environmental Factors

of Performance

C. Methods

D. Potential Errors in Performance

Appraisal
E. Overcoming Errors
 Performance Appraisal System
 Performance

Degree of accomplishment of the tasks that make up an

employee’s job

Reflects how well an employee is fulfilling

requirements of a job
Often confused with effort, which refers to energy
expended, performance is measured in terms of
results
 Performance Appraisal System
Appraisal

An act of assessing something or someone.

 Performance Appraisal System
Process of determining and communicating to an
employee how he/she is performing on the job and,
ideally, establishing a plan of improvement

An annual review of an employee's overall

contributions to the company by his/her
manager. Performance appraisals, also called
annual reviews, evaluate an employee's skills,
achievements and growth, or lack thereof
 Determinants of Performance
Job performance is net effect of an employee’s effort as modified by
abilities and role (or task) perceptions

Effort – Results from being motivated

Abilities – Are personal characteristics used in performing a job

Role (task) perceptions–Refer to direction(s) in which

individuals believe they should channel their effort on their jobs

To attain an acceptable level of performance, a minimum level

of proficiency must exist in each of the performance components
 Environmental Factors-Performance Obstacles
1. Common potential performance obstacles include

1. Employee’s lack of time or conflicting demands upon it

2. Inadequate work facilities and equipment

3. Restrictive policies that affect the job

4. Lack of cooperation from others

5. Type of supervision

6. Temperature, lighting, noise, machine or equipment pacing

 Environmental Factors-Performance Obstacles
1. Environmental factors…… not as direct determinants of
individual performance but … effects of effort, ability, and
direction

1. Poor ventilation or worn-out equipment

2. Unclear policies or poor supervision

3. A lack of training can result in underutilized abilities

2. One of management’s greatest responsibilities is to provide

1. Employees with adequate working conditions

2. A supportive environment to eliminate or minimize

performance obstacles
 Performance Appraisal Methods
1. Whatever PA method an organization uses,must be job related
2. Methods of performance appraisals include
1. Management by objectives (MBO)
2. Multi-rater assessment (or 360-degree feedback)
3. Graphic rating scale
4. Behaviorally anchored rating scale (BARS)
5. Critical-incident appraisal
6. Essay appraisal
7. Checklist
8. Forced-choice rating
9. Ranking methods
10. Work standards approach
 Management by Objectives (MBO)

1. More commonly used with professional and managerial employees

2. Consists of
1. Establishing clear and precisely defined statements of objectives for the
work to be done by an employee
2. Establishing an action plan indicating how these objectives are to be
achieved
3. Allowing employee to implement the action plan
4. Measuring objective achievement
5. Taking corrective action when necessary
6. Establishing new objectives for the future
3. Other names for MBO include management by results, performance
management, results management, and work planning and review
program
Examples of How to Improve Work Objects
 Multi-Rater Assessment (360-Degree
Feedback)
1. Managers, peers, customers, suppliers, or colleagues are asked
to complete questionnaires on the employee being assessed

2. Person assessed also completes a questionnaire

3. Questionnaires are generally lengthy. Typical questions are:

1. “Are you crisp, clear, and articulate? Abrasive?”

4. Human resources department provides results to the

employee, who in turn gets to see how his or her opinion
differs from those of the group doing the assessment
 Graphic Rating Scale
In this method, traits or behaviors that are important for effective
performance are listed out and each employee is rated against
these traits. The rating helps employers to quantify the behaviors
displayed by its employees.
1. Quantity of work
2. Dependability
3. Job knowledge
4. Cooperativeness
Behaviorally Anchored Rating Scale (BARS)
PA method that determines an employee’s level of performance
based on whether or not certain specifically described job
behaviors are present