PERFORMANCE APPRAISAL and MANAGEMENT Performance Appraisal is an

PERFORMANCE APPRAISAL and MANAGEMENT

Performance Appraisal is an objective assessment of an individual’s performance against well defined benchmarks. Relationship between Performance Appraisal & Job Analysis

Shift in Performance Management Outlook

Objectives-Performance Appraisal – To effect promotions based on competence and performance – To confirm the services of probationary employees upon their completing the probationary period satisfactorily – To assess the training and development needs of employees – To decide upon a pay raise where (as in the unorganised sector) regular pay scales have not been fixed – To let the employees know where they stand insofar as their performance is concerned – To improve communication – Can be used to determine whether HR programmes such as selection, training, and transfers have been effective or not

Purpose- Performance Appraisal 1. 2. 3. 4. Developmental uses Administrative uses/ Decisions Organisational Maintenance Documentation

Performance Appraisal as Competitive Advantage

Principles of Performance Management – Corporate goals are translated into individual, team, departmental and divisional goals – It should not be linked with only financial rewards – Performance improvement is an ongoing process and improves over time – Consensus and co-operation needed, not control and coercion – Transparency is needed at every stage – Continuous feedback is essential – It should cover all employees – It is a system and not a piece of work – Make it simple and easy – Involvement of all stakeholders in designing formats, policies and procedures is needed

Appraisal Process

Appraisal Process 1. Objectives:

Appraisal Process 2. Establish Job Expectations 3. Design Appraisal Programme

Appraisal Process Problems of Rating: • Leniency/Severity • Central Tendency • Halo Effect/ Horn Effect • Primacy/ Recency Effect • Stereotyping/ Perceptual set • Spillover Effect • Status Effect • Other errors- like, error of wishful thinking Read Exhibit 9. 2

Appraisal Process Solution to Raters problems: • Factors that help improve accuracy: – The rater has observed and is familiar with behaviours to be appraised – The rater has documented behaviours to improve the recall – The rater has a checklist to obtain and review job-related information – The rater is aware of personal biases and is willing to take action to minimise their effect – Rating scores by raters of one group or organisation are summarised and compared with those by other raters – The rater focuses attention on performance-related behaviours over which the rater has better control than in other aspects of evaluation

Appraisal Process • Factors that help improve accuracy: – Higher levels of management are held accountable for reviewing all ratings – The rater’s own performance ratings are related to the quality of rating given and the performance of units – Performance factors are properly defined • Factors that may lower accuracy: – The rater rates ratees only when administrative actions are contemplated – The rater tends to inflate ratings when the ratees receive scores and results of appraisals – The rater tends to recall more behaviours known to be of particular interest to higher -level managers – The rater is unable to express himself or herself honestly and unambiguously – Appraisal systems, processes and instruments fail to support the rater – The rater is unaware of causes of rating errors – The rater has to rate employees on factors that are poorly defined

Appraisal Process • What should be rated? ? Quality, quantity, timeliness, cost effectiveness, need for supervision, interpersonal impact & community services. e. g. Mind Tree Consulting- CLASS

The Philips Model- Designing Appraisal

Appraisal Process • Timing of evaluation? ? • Methods of Appraisal: 1. Past Oriented methods 2. Future Oriented methods

Appraisal Process: Past Oriented Methods 1. RATING SCALE/ GRAPHIC RATING SCALE

Appraisal Process: Past Oriented Methods 2. CHECKLIST METHOD

Appraisal Process: Past Oriented Methods 3. FORCED CHOICE METHOD

Appraisal Process: Past Oriented Methods 4. FORCED DISTRIBUTION METHOD

Appraisal Process: Past Oriented Methods 5. CRITICAL INCIDENT METHOD

Appraisal Process: Past Oriented Methods 6. BEHAVIOURALLY ANCHORED RATING SCALE

Appraisal Process: Past Oriented Methods 7. PAIRED COMPARISION

Appraisal Process: Past Oriented Methods 8. Performance Test & Observation 9. Confidential Records 10. Essay Evaluation 11. Ranking Metho. D

Appraisal Process: Future Oriented Methods 1. 2. 3. 4. Management by Objjectives (MBO) Assessment Centres Psychological Appraisals 360 degree feedback

Why Appraisal Fails? ?

Tips to make Appraisal Effective

Performance Management • Performance appraisal only gives feedback • More is required in addition to this: 1. Performance interview 2. Archiving performance data 3. Use of appraisal data

Performance Management

Performance Management. Performance Interview • Guidelines for Effective Appraisal Interview – – – – Select a good time Minimise interruptions Welcome, set at ease Start with something positive Ask open-ended questions to encourage discussion Listen Manage eye contact and body language Be specific Rate behaviour, not personality Layout development plan Encourage subordinate participation Complete form Set mutually agreeable goals for improvement End in a positive, encouraging note Set time for any follow-up meetings

Performance Management- Archiving Performance Data Organisations need to store the appraisal data so that at any point in future the information can be retrieved and used.

Performance Management- Use of Appraisal Data – In one way or another, data and information outputs of a performanceappraisal programme can critically influence these coveted employer– employee reward opportunities. Specifically, the data and information will be useful in the following areas of HRM: • Remuneration administration • Validation of selection programmes • Employee training and development programmes • Promotion, transfer and lay-off decisions • Grievance and discipline programmes • HR planning