Performance Appraisal types and examples Performance appraisal Traditional

Performance Appraisal - types and examples

Performance appraisal - Traditional approach Traditionally, performance appraisal has been used as just a method for determining and justifying the salaries of the employees. Then it began to be used a tool for determining rewards (a rise in the pay) and punishments (a cut in the pay) for the past performance of the employees.

Traditional approach This approach was a past oriented approach which focused only on the past performance of the employees i. e. during a past specified period of time. This approach did not consider the developmental aspects of the employee performance i. e. his training and development

Performance Appraisal Methods Individual Evaluation Methods Confidential report Essay evaluation Critical incidents Checklists Graphic rating scale Behaviorally anchored rating scale MBO

Confidential Report Descriptive report Prepared at the end of the year Prepared by the employee’s immediate supervisor The report highlights the strengths and weaknesses of employees Prepared in Government organizations Does not offer any feedback to the employee

Essay evaluation The rater is asked to express the strong as well as weak points of employee’s behavior The rater considers the employee’s : Job knowledge and potential Understanding of company’s programs, policies, objectives etc Relation with co-workers and supervisors Planning, organizing and controlling ability Attitude and perception

Critical incidents Manager prepares lists of statements of very effective and ineffective behavior of an employee These critical incidents represent the outstanding or poor behavior of the employees The manager periodically records critical incidents of employee’s behavior

Example: July 20 - Sales clerk patiently attended to the customers complaint. He is polite, prompt, enthusiastic in solving the customers’ problem July 20 - The sales assistant stayed 45 minutes beyond his break during the busiest part of the day. He failed to answer store manager’s call thrice. He is lazy, negligent, stubborn and uninterested in work

Critical Incident method Ex: A fire, sudden breakdown, accident Workers reaction A B C D E informed the supervisor immediately Become anxious on loss of output tried to repair the machine Complained for poor maintenance was happy to forced test scale 5 4 3 2 1

Checklists A checklist is a set of objectives or descriptive statements about the employee and his behavior. Under weighted checklist, value of each question may be weighted. Example: Is the employee really interested in the task assigned? Yes / No Is he respected by his colleagues? Yes / No

Checklist method • Simple checklist method • Weighted checklist method • Forced choice method Simple checklist method: Is employee regular Is employee respected by subordinate Is employee helpful Does he follow instruction Does he keep the equipment in order Y/N Y/N Y/N

Weighted checklist method weights Regularity Loyalty Willing to help Quality of work Relationship 0. 5 1. 5 2. 0 performance rating (scale 1 to 5 )

Forced choice method This method uses several sets of paired phrases, two of which may be positive and two negative The rater is asked to indicate which of the four phrases is the most and least descriptive of a particular worker Favorable qualities earn plus credit and unfavorable ones earn the reverse

Forced choice method Criteria 1. Regularity on the job • Always regular • Inform in advance for delay • Never regular • Remain absent • Neither regular nor irregular Rating Most Least

Graphic Rating Scale A form is used to evaluate the performance of the employees A variety of traits may be used in this device, the most common being quality and quantity of work Easy to understand use. Permits statistical tabulation of scores of employees

Graphic Rating Scale • • Continuous Rating Scale Discontinuous Rating Scale Employee name_____ Deptt_______ Rater’s name ______ Date____ ------------------------------------Exc. Good Acceptable Fair Poor 5 4 3 2 1 _ Dependability Initiative Overall output Attendance Attitude Cooperation Total score Continuous Rating Scale

Indifferent Enthusiastic Attitude No Interested Discontinuous Rating Scale Very enthusiastic

BARS( behaviorally Anchored rating scale) Step 1. Identify critical incidents Step 2. Select performance dimension Step 3. Retranslate the incidents Step 4. Assign scales to incidents Step 5. Develop final instrument

MBO Process Set organizational goals Defining performance target Performance review feedback

MBO emphasizes collectively set goals that are tangible, verifiable, and measurable Focuses attention on goals rather than on methods Concentrates on Key Result Areas (KRA) Systematic and rational technique that allows management to attain maximum results from available resources by focusing on achievable goals

Key Elements Of MBO Arranging organizational goals in a means-ends chain Engaging in joint goal setting This process has the following steps: Identify KRAs Define expected results Assign specific responsibilities to employees Define authority and responsibility relationship Conducting periodic progress review Conducting annual performance review

Performance Appraisal Methods Group Appraisal Ranking Paired comparison Forced distribution Performance tests Field review technique 360 degree Appraisal Method

Ranking method The evaluator rates the employee from highest to lowest on some overall criteria

Paired comparison method Each worker is compared with all other employees in a group For several traits paired comparisons are made, tabulated and then rank is assigned to each worker This method is not applicable when the group is large

Ranking method Employee Rank A 2 B 1 C 3 D 5 E 4

Paired comparison method A A - B - C - D + E Final Rank + 3 B + - - + + 2 C + + - + + 1 D - - + 4 E - - - 5 No of Positive evaluation Total no. of evaluation * 100 = employee superior evaluation

Forced Distribution Methods The rater is asked to appraise the employee according to predetermined distribution scale. Two criteria used for rating are: job performance and promotability.

Forced Distribution Methods A five point performance scale is also used without mentioning any descriptive statements. The worker is placed between two extremes of “good” and “bad” performance.

Forced Distribution method No. of employees 10% 20% poor 40% 20% Below average good average Force distribution curve 10% Excellent

Field review method The appraiser goes to the field and obtains the information about work performance of the employee by way of questioning the said individual, his peer group, and his superiors

Field review method Performance Dimension subordinate peers Leadership ^ Communication ^ ^ Interpersonal skills ^ ^ superior customer ^ Decision making ^ ^ ^ Technical skills ^ ^ ^ Motivation ^ ^ ^

360 o Appraisal System It is a systematic collection and feedback of performance data on an individual or group, derived from a number of stakeholders Data is gathered and fed back to the individual participant in a clear way designed to promote understanding, acceptance and ultimately behavior

360 o Appraisal System Appraisal taken from: àBoss (HOD) àSubordinates àPeers àImmediate supervisor

Performance criteria for executives For top managers Return on capital employed Contribution to community development Degree of upward communication from middle-level executives Degree of growth and expansion of enterprise.

For middle level managers Departmental performance Coordination among employees Degree of upward communication from supervisors Degree of clarity about corporate goals and policies

For supervisors Quality and quantity of output in a given period Labor cost per unit of output in a given period Material cost per unit in a given period Rate of absenteeism and turnover of employees No of accidents in a given period

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