Performance Appraisals

Meaning :
Performance appraisal is a method by which the job performance of an employee is evaluated (generally in terms of quality, quantity, cost, and time) typically by the corresponding manager or supervisor. It is the process of obtaining, analyzing and recording information about the relative worth of an employee. Performance appraisal is an analysis of an employee's recent successes and failures, personal strengths and weaknesses, and suitability for promotion or further training.

Performance Appraisal :
Definition : Indian National Institute of personnel management
Performance Evaluation is a technique of assessing as impartially as possible , the attributes, strengths, weakness and attitude of individual employee in relation to his job.

Methods/ Techniques of performance appraisal:

1. Graphic Rating Scale 2. Ranking Methods 3. Comparison Method 4. Forced Distribution Method 5. Forced choice method 6. Management by objective 7. Peer Evaluation 8. Behaviorally Anchored Rating Scales(Bars) 9. Self Evaluation Method 10. 360-Degree Feedback

Graphic Rating Scale

In this method, an employees quality and quantity of work is assessed in a graphic scale indicating different degrees of a particular trait. The performance is evaluated on the basis of different factors that are called as rating factors. The factors taken into consideration include both the personal characteristics and characteristics related to the on-the-job performance of the employees. For example a rating factors like, Job Knowledge may be judged on the range of average, above average, outstanding or unsatisfactory.

Example

Always Inefficient

Usually inefficient

Sometimes efficient/ sometimes inefficient

Usually efficient

Always efficient

Ranking Methods
Ranking is a performance appraisal method that is used to evaluate employee performance from best to worst. Manager will compare an employee to another employee, rather than comparing each one to a standard measurement. The rater simply ranks employees from high to low on a given performance dimension. The employee who is given the first rank is regarded as the best while the one with lowest rank is regarded as the worst. The rank of the individual tells where exactly he stands and how many people are below and above the individual.

Example
Employee A Judge 1

1 3 4 2

Comparison Method
A better technique of comparison than the straight ranking method, this method compares each employee with all others in the group, one at a time. Comparison are made between two people at a time , and a judgment is made about which of the pair is superior. Final conclusion are drawn on the basis of the number of times each person was selected as the better of the pair.

Employees
Deepak Ravindra Umesh Virendra Ramesh

Scoring :
Employees Deepak Ravindra Umesh Virendra Ramesh No. of times name squared 4 3 1 2 0

Forced Distribution Method

Forced ranking method is used when the number of employees to be evaluated is large. This method is based on the principle of normal distribution and assumes that employee performance is normally distributed. The force distribution system is called by that name because the rater is forced to place a percentage of the employees in each of the several categories. and asked to distribute the employees in some fixed categories of ratings like on a normal distribution curve.

Example
Forced Distribution method

Management by Objectives (MBO)

MBO is a process in which managers / employees set objectives for the employee, periodically evaluate the performance, and reward according to the result. MBO focuses attention on what must be accomplished (goals) rather than how it is to be accomplished (methods) Key MBO Ideas Employee involvement creates higher levels of commitment and performance. Encourages employees to work effectively toward achieving desired results. Performance measures should be measurable and should define results.

Advantages of MBO
1) 2) 3) 4) 5)

Increases motivation Reduces role conflict Early identification of problems Feedback Organizational planning

Disadvantage of MBO
1) 2)

Time consuming Disagreement

Behaviorally Anchored Rating Scales(Bars)

This method used to describe a performance rating that focused on specific behaviors or sets as indicators of effective or ineffective performance.

Developing a BARS


Assesses employees behaviors instead of other characteristics Identifying important job dimensions Creating statements describing a range of desired and undesirable behaviors (anchors) Set scales for anchors

Behaviorally Anchored Rating Scales(Bars)

Step 1. Step 2. Step 3. Step 4. Step 5.

Identify critical incidents Select performance dimension Retranslate the incidents Assign scales to incidents Develop final instrument

BehaviorallyBehaviorally-Anchored Rating Scale for Customer Service Skills

Peer Appraisal
In this method of performance appraisal , the employees are asked to assess their own abilities and job performance. They have to also evaluate their strength and weakness. the central idea behind self rating is that no one knows an individual better than the individual himself

Disadvantage
Unreliable Mutual understanding Conflict and ill will

Self Evaluation
The main thought behind this method of appraisal is that an employee s are asked to assess their own abilities and job performance . They also evaluate their strengths and weaknesses. The central idea behind self rating is that no one knows an individual better than the individual himself.

Disadvantage
Lenient Overestimation

360-Degree Feedback
360 Degree Feedback is a system or process in which employees receive confidential feedback from the people who work around them. A 360-degree feedback is a performance evaluation process that gather performance information from multiple people, including ones subordinates , peers , supervisors and customers. 360-degree aims at providing more accurate employees performance by providing feedback from different sources. In India too large organization such as Reliance Industries, Infosys, Godrej soaps, Wipro have started using this system to evaluate the performance of their employees.

360360-Degree Feedback

Question arises?
  

Why do we measure performance? Effective performance appraisal systems How do we measure performance?