Performance Management

What is Performance
Management System?
 Effective performance management systems
contains two basic systems operating in
conjunction:
 an evaluation system and
 a feedback system

 The aim of the evaluation system is to

identify the performance gap (if any).
 The aim of the feedback system is to inform
the employee about the quality of his or her
performance.
Comparing Performance Appraisal and
Performance Management

 Performance appraisal
 Evaluating an employee’s past performance
relative to his or her performance
standards.
 Performance management
 The process employers use to facilitate
that employees are working toward
organizational goals.
 Performance Management System may be
defined as a structured formal interaction
between a subordinate and supervisor, that
usually takes the form of a periodic interview
(annual, semi-annual…), in which the work
performance of the subordinate is examined
and discussed, with a view to identifying
weaknesses and strengths as well as
opportunities for improvement and skills
development.
WHY APPRAISAL?
 Performance Appraisal can be viewed
from two different point of views viz:
 Employee Viewpoint: From the employee
viewpoint, the purpose of performance
appraisal is four-fold:
 (1) Tell me what you want me to do
 (2) Tell me how well I have done it
 (3) Help me improve my performance
 (4) Reward me for doing well.
WHY APPRAISAL?
 Organizational Viewpoint:
 One of the most important point for an
organization to have performance appraisal is to
establish the principle of accountability. The
objective is to align responsibility and
accountability at every organizational level.
 It provides an opportunity for one-on-one
discussion of the employee and the supervisor on
important work related topics that may not have
been discussed otherwise.
 Performance appraisal can have a profound effect
on levels of employee motivation and satisfaction.
Performance Management System
(overview of process)
Objectives of Performance
Appraisal

Establish Job Expectations

Design an Appraisal
program

Appraisal of Performance

Performance Review
( Interview)

Use Appraisal Data for

Appropriate Purposes
OBJECTIVES OF Performance
assessment
 Correlate with the organization's philosophies
and mission
 Cover assessment of performance as well as
potential for development
 Look after the needs of both the individual
and the organization
 Help create a clean environment
 Link rewards to achievements
 Generate information for personnel
development and career planning
 Suggesting appropriate person-task matching
JOB EXPECTATIONS

 Here, the job expectations we are talking

about are not just about what an employee
wants from the company but also what
exactly in terms does the company wants
from the employee.
DESIGNING APPRAISAL

 A program to monitor the performance of

the organization’s employees is carefully
designed keeping in mind the following;
1. Formal Vs Informal Appraisal?
2. Who is to be appraised?
3. Who are the raters?
4. Evaluation Criteria?
THE APPRAISAL
 This is the step where actually the
performance of the employee is measures
and marked.
 The role of the counselor is of prime
importance at this step as his observations
are closely linked to the appraisal of the
employee.
THE APPRAISAL
 Some of the points kept in mind while
appraisal are:
1. Quantity of output
2. Quality of output
3. Punctuality of output
4. Presence at work
5. Cooperativeness
METHODS OF PERFORMANCE
APPRAISAL
 WRITTEN ESSAY

 In the essay method approach, the appraiser

prepares a written statement about the
employee being appraised.
 Describes specific strengths and weaknesses in
job performance.
 Suggest remedy as well.
 It is the simplest method of appraisal as it is a
narrative describing employees strengths,
weaknesses, past performances, potential and
suggestions for improvement.
GRAPHIC RATING SCALE
 It is the oldest and most popular methods of
evaluation.
 In this method a set of performance factors like
quantity and quality of work,
depth of knowledge, cooperation, loyalty,
attendance, honesty and initiative are listed.
 The appraiser has to mark them each on a scale
of 1 to 5 where 1 is poorly informed and 5
shows complete mastery of all phases of work.
RESULT METHOD
 MBO (management by objectives) methods of
performance appraisal are results-oriented. That
is, they seek to measure employee performance
by examining the extent to which predetermined
work objectives have been met.
 Once an objective is agreed, the employee is
usually expected to self-audit; that is, to identify
the skills needed to achieve the objective. After
that They are expected to monitor their own
development and progress
The Balanced
Scorecard
Behavior based method
 Graphic rating scales:
BARS improvement
 Behaviorally Anchored Rating Scales
(BARS)
 Use critical incidents as anchors
 Involves multiple groups of employees in
development
 Identify important job elements
 Describe critical incidents at various levels of
performance.
BEHAVIOURALLY ANCHORED
RATING SCALE
 BARS combine elements from critical incident
and graphic rating scale approaches.

 The appraiser rates the employees based on

items along a continuum, but the points are
the examples of actual behavior rather than
general traits or descriptions.
Behaviorally Anchored Rating Scales (BARS)
= Has behavior anchors
1. List critical incidents
2.Critical incidents retranslated to
dimensions.
3.Cluster Dimensions
4. Behaviour Dimensions rated on 5,7, 9 (?) point
scale.
5. Critical incidents worded as expectations
 IMPROVING APPRAISAL
 Emphasize Behavior Rather Than Traits
 Recording Performance Behavior Periodically
 Using Multiple Evaluators
 Provide employees with Due process information and
details
 Appraiser Credibility
 360 Degree Feedback.
PERFORMANCE INTERVIEW

In performance interview, the raters meet

the concerned employee and discuss and
review his performance so that they will
receive feedback about where they stand
in the eyes of their superiors and will
give feedback on the facilitating and
inhibiting factors.
PERFORMANCE INTERVIEW
 Performance interview has 3 main goals-
(i) To change behavior that does not meet
organizational requirements or employee’s
personal goals.
(ii) To maintain the behavior of employees who
has performed in an acceptable manner.
(iii) To recognize superior performance
behaviors so that they will be continued.
APPRAISAL DATA
1. Remuneration administration
2. Validation of selection programs
3. Employee training and development
programs
4. Promotion, transfer and lay-off decisions
5. Grievance and discipline programs
6. HR planning