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As a result, employees understand what they need to accomplish and how theyll be measured
in terms of how we define success, Bettinger says. In reviewing a new product rollout, for
example, he might address questions such as, How is this product resonating with our
customers?, Are we behind or ahead of schedule? and If were not on track, how will we
change to get back on track?
By connecting an employees daily activities to larger operational issues, a process review has
more impact than a traditional performance review thats narrower in scope. Rather than critique
a managers work in isolation, the focus expands to evaluate the status of products or projects
under that managers purview.
Keep Score of Performance
Entrepreneurs love launching businesses, but they usually dread conducting performance
reviews. Its rarely gratifying to tell employees what theyre doing wrong or why theyre not
getting a pay raise.
Fortunately, there are creative solutions that make such reviews easier to administer. Start by
placing less emphasis on formal appraisals. Shift your focus to educating workers about what
constitutes success.
For new hires, have their job description double as a performance evaluation tool. List the tasks
they need to do and your expectations for their role.
Make the job description document serve as your performance review document, says Rick
Galbreath, president of Performance Growth Partners, a leadership development firm in
Bloomington, Ill.
To ensure that employees understand how their performance contributes to the organizations
bottom line, use a balanced scorecard. Popularized in the 1990s, its based on a summary
report consisting of key measures along with desired targets.
The scorecard results enable both employer and employees to keep track on a daily basis of
individual performance as it impacts larger outcomes. Appraisals thus become a relatively
painless outgrowth of a simple scoring system that everyone understands and accepts.
Deliver Criticism That Sticks
While assessing an employees performance is typically a structured process involving forms and
rating systems, its also a test of your communication skills. You need to deliver constructive
Every employee has metrics that are specific to the job, he says. These metrics are part of the
quarterly KPIs, which are tied to compensation.
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1. Essay Method
In this method the rater writes down the employee
description in detail within a number of broad categories
like, overall impression of performance, promoteability
of employee, existing capabilities and qualifications of
performing jobs, strengths and weaknesses and training
needs of the employee. Advantage It is extremely
useful in filing information gaps about the employees
that often occur in a better-structured checklist.
Disadvantages It its highly dependent upon the writing
skills of rater and most of them are not good writers.
They may get confused success depends on the memory
power of raters.
3. Rating Scale
4. Checklist method
Under this method, checklist of statements of traits of
employee in the form of Yes or No based questions is
prepared. Here the rater only does the reporting or
checking and HR department does the actual evaluation.
Advantages economy, ease of administration, limited
training required, standardization. Disadvantages Raters
biases, use of improper weighs by HR, does not allow
rater to give relative ratings
5.Ranking Method
The ranking system requires the rater to rank his
subordinates on overall performance. This consists in
simply putting a man in a rank order. Under this method,
the ranking of an employee in a work group is done
against that of another employee. The relative position of
each employee is tested in terms of his numerical rank. It
may also be done by ranking a person on his job
performance against another member of the competitive
group.
Advantages of Ranking Method
Employees are ranked according to their
performance levels.
It is easier to rank the best and the worst
employee.
Limitations of Ranking Method
The whole man is compared with another
whole man in this method. In practice, it is very difficult
to compare individuals possessing various individual
traits.
This method speaks only of the position where an
employee stands in his group. It does not test anything
about how much better or how much worse an employee
is when compared to another employee.
When a large number of employees are working,
ranking of individuals become a difficult issue.
There is no systematic procedure for ranking
individuals in the organization. The ranking system does
not eliminate the possibility of snap judgements.