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Performance appraisal is a systematic and objective way of evaluating both

work related behavior and potential of employees.


Performance Appraisal is the process of assessing the performance and

progress of an employee or a group of employees on a given job and his /
their potential for future development. It consists of all formal procedures
used in the working organizations to evaluate personalities, contributions
and potentials of employees.
It is a   , essentially involving 
 : set
work standards, assess employee's performance relative to these
standards, and offer feedback to the employee so that he or she can
eliminate deficiencies and improve performance
he appraisal is     according to a definite
It is not a past oriented activity. he intention is not to put poor
performers in a spot. Instead, it

    , how to set things in order and deliver superior

performance using their potential fully
he focus of appraisals is on    

 . It forces managers to be coaches rather than judges.
Compensation decisions

Personal growth and

Promotion decisions

Feedback to the raining and development

employee programs
[espite imperfect measurement techniques, individual differences in
performance can make a difference to company performance.
[ocumentation of performance appraisal and feedback may be required
for legal defense.
Appraisal offers a rational basis for constructing a bonus or merit
Appraisal dimensions and standards can help to implement strategic
goals and clarify performance expectations.
Individual feedback helps people to rectify their mistakes and get
ahead, focusing more on their unique strengths.
Assessment and reorganization of performance levels can motivate
employees to improve their performance.
he content to be appraised is determined on the basis of job analysis.
Usually it comprises of:
ehaviors, including observable physical actions, movements
Objectives which measure job related results
raits which are measured in terms of personal characteristics

elf appraisal

Conducted informally
Carried out systematically at regular intervals, sticking to a definite

stablish performance standards

Communicate the standards

Measure actual performance

Compare actual performance with

standards and discuss the appraisal



FORC[ [IRIUION 360-[egree feedback
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raditional form of appraisal used in most government organizations.

Confidential report is a report prepared by the employee's immediate superior.

It covers the strengths and weaknesses, main achievements and failures,
personality and behavior of the employee.

It is a descriptive appraisal used for promotions and transfers of employees.

he evaluator writes a short essay on the employee's performance on the
basis of overall impression.

It can provide a good deal of information about the employee especially if

the evaluator is asked to give examples of each one of his judgments.

his method may be appropriate for assessing senior executives where

the number involved is small.
he evaluator assigns relative ranks to all the employees in the same work
unit doing the same job. mployees are ranked from the best to the poorest
on the basis of overall performance.

he relative position of an employee is reflected in his numerical rank.

It is time saving and a comparative evaluation technique of appraisal.

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ach employee is compared with all the others in pairs one at a time. he
number of times an employee is judged better than the others determines
his rank.

Comparison is made on the basis of overall performance. he number of

comparisons to be made can be decided on the basis of the following

N (N-1) / 2,

where N is the number of persons to be compared.

he rater is required to distribute his ratings in the form of a normal
frequency distribution.

he purpose is to eliminate the rater's bias of central tendency. Here

also ranking technique is used.

his method is highly simple to understand and easy to apply.

It helps to reduce bias involved in straight ranking and paired

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It is a numerical scale indicating different degrees of a particular trait.

he rater is given a printed form for each employee to be rated. he form

contains several characteristics relating to the personality and performance of

he rater records his judgment on the employee's trait on the scale. he

numerical points given to an employee are added up to find out his overall
An illustration of graphic rating scale:


It is a list of statements that describe the characteristics and

performance of employees on the job.

he rater checks to indicate if the behavior of an employee is positive or

negative to each statement. he performance of an employee is rated on
the basis of number of positive checks.
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he supervisor keeps a written record of critical (either good or bad)
events and how different employees behaved during such events.

he rating of an employee depends on his positive / negative

behavior during these events.

his method helps to avoid vague impressions and general marks as

the rating is based on actual records of behavior / performance.

he illustration is given in the next slide.


A group of evaluators assesses employees. his group consists of the

immediate supervisor of the employee, other supervisors having close
contact with the employee's work, head of the department and a
personnel expert.

he group determines the standards of performance for the job,

measures actual performance of an employee, analyses the causes of
poor performance and offers suggestions for improvements in future.

A training officer from the personnel department interviews line

supervisors to evaluate their respective subordinates. he interviewer
prepares in advance the questions to be asked.

y answering these questions a supervisor gives his opinions about

the level of performance of his subordinate, the subordinate's work
progress, his strengths and weaknesses, promotion potential, etc.
Assessment centre is a group of employees drawn from different work

hese employees work together on an assignment similar to the one they

would be handling when promoted.

valuators observe and rank the performance of all the participants.

It generally measures interpersonal skills, communicating ability, ability to

plan and organize etc.
Performance is judged in terms of costs and contributions of employees.

Costs of human resources consist of expenditure on HR planning,

recruitment, selection, induction, training, compensation, etc.

Contribution of human resources is the money value of labor productivity or

value added by human resources.

[ifference between cost and contribution will reflect the performance of

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Combines graphic rating scales with critical incidents method.

[escriptions of various degrees of behavior relating to specific

performance dimensions.

he rater records observable job behavior of an employee and compares

these observations with AR.

he illustration is given in the next slide.

Identify critical incidents

elect performance dimensions

Retranslate the incidents

Assign scale to incidents

[evelop final instrument

he concept of management by objectives (MO) was developed by
Peter [rucker in 1954.

A process whereby the superior and subordinate managers of an

organization jointly identify its common goals, define each individual's
major areas of responsibility in terms of results expected of him and use
these measures as guides for operating the unit and assessing the
contributions of each of its members.

360-degree feedback is feedback that comes from all around an

employee. "360" refers to the 360 degrees in a circle, with an individual
figuratively in the center of the circle. Feedback is provided by
subordinates, peers, and supervisors.

he results from 360-degree feedback are often used by the person

receiving the feedback to plan training and development. Results are also
used by some organizations in making administrative decisions, such as
pay or promotion.

POII - A positive leniency error overstates performance, giving

the individual a higher appraisal. valuators are positively lenient in
their appraisal.

NGAI - It understates performance, giving the individual a lower


endency to rate high or low on all factors due to the impression of a high or
low rating on some specific factor.

A method to counter the problem, which can be used where there is more
than one person to be evaluated, is to have the evaluator appraise all
employees on each dimension before going on the next dimension.
valuators rate people in the same way that the evaluators perceive
xample- he evaluator who perceives himself as aggressive may evaluate
others by looking for aggressiveness. hose who demonstrate this
characteristic tend to benefit, while others are penalized.
his error would tend to wash out if the same evaluator appraised all the
people in the organization.
If the evaluator knows that a poor appraisal could significantly hurt the
employees promotion or a salary increase, the evaluator may be
reluctant to give a realistic appraisal.
It is more difficult to obtain accurate appraisals when important rewards
depend on the results.

he reluctance to make extreme ratings; the inability to distinguish

between and among ratees; a form of range restriction.

xample- If a manager rates all subordinates as 3, on a scale of 1 to 5,

then no differentiation among the subordinates exists. Failure to rate
subordinates as 5, for those who deserve that rating, and as 1, if the case
warrants it, will only create problems.
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asing appraisals on accurate and current job descriptions
nsuring that appraisers have adequate knowledge and direct experience
of the employees performance
Providing ratings via aggregated anonymous feedback when multiple
sources of information are used
Incorporating performance appraisals into a formal goal setting system
Offering adequate support and assistance to employees such as
professional development opportunities in order to improve their performance
Conducting appraisals on a regular basis (at least two times a year) rather
than annually.