Hrm-mod-5

Performance Appraisal •

Performance appraisal is a method of evaluating the behavior of employees in the work spot, normally including both the quantitative and qualitative aspects of job performance

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The process of Performance Appraisal helps the employee and the management to know the level of employee’s performance compared to the standard/pre-determined level

Some Important features of Performance Appraisal

PA is a systematic description of an employee’s job-relevant strengths and weaknesses

Scheme • Performance appraisal – Nature of – Appraisal process – Edward Deming on appraisal – Challenges of appraisal – Legal issues

• Job evaluation – Job evaluation process – Methods of evaluation – Alternative to job evaluation

Learning Objectives • Understand the nature of performance evaluation • Compare and contrast performance appraisal and job evaluation • Explain different stages in evaluation • Describe job evaluation process

Opening Case Two bee-keepers story • Bee Keeper 1 focused on the number of flowers visited by bees • Bee Keeper 2 focused on honey produced, irrespective of the number of flowers visited • Who is right?

Objectives of Appraisal 1. To effect promotions based on competence and performance. 2. To confirm the services of probationary employees upon their completing the probationary period satisfactorily. 3. To assess the training and development needs of employees. 4. To decide upon a pay raise where (as in the unorganised sector) regular pay scales have not been fixed.

Objectives of Appraisal (Contd…) 5. To let the employees know where they stand insofar as their performance is concerned and to assist them with constructive criticism and guidance for the purpose of their development. 6. To improve communication. Performance appraisal provides a format for dialogue between the superior and the subordinate, and improves understanding of personal goals and concerns. This can also have the effect of increasing the trust between the rater and the ratee. 7. Finally, performance appraisal can be used to determine whether HR programmes such as

Objectives of Appraisal

How Performance Appraisal can Contribute to Firm’s Competitive Advantage

The Performance Appraisal Process

Problems of Rating • Leniency or severity • Central tendency • Halo error • Rater effect • Primacy and recency effects • Perceptual set • Spillover effect • Status effect

Methods of Performance Appraisal

Challenges of Appraisal

Appraising Teams

Legal Issues • Legally Defensible Appraisal Procedures • Legally Defensible Appraisal Content • Legally Defensible Documentation of Appraisal Results • Legally Defensible Raters

Deference Between Job Evaluation and Performance Appraisal

Job-evaluation Process

Methods of Job Evaluatoin

• The basic purpose is to find out how well the employee is performing the job and to establish a plan for improvement • PA are arranged periodically according to a definite plan • PA is a continuous process

PURPOSE for Performance Appraisal

• To Create and maintain a satisfactory level of performance • To contribute to employee growth and development

PURPOSE for Performance Appraisal • To help the superiors to have a proper understanding about their subordinates • To facilitate fair and equitable compensation based on performance

• To facilitate for testing and validating the selection process • To provide information for making decisions regarding lay-off, retrenchment etc

• To ensure organizational effectiveness through improved standards • To guide the job changes

Evaluation Process Establish performance standards Communicate performance expectations to employees Measure actual performance Compare actual with standards Discuss the appraisal with employees If necessary, initiate corrective action

Content of Performance Appraisal 1) Regularity of Attendance

1) Area of Stability

2) Self Expressing: Written and Oral

2) Initiative

3) Ability to work with others

3) Technical Skills

4) Leadership style and abilities

4) Creative Skills

5) Technical Ability/ Knowledge

5) Areas of Interest

6) Ability to grasp new things

6) Judgment Skills

7) Reasoning Ability

7) Integrity

8) Originality and Resourcefulness

8) Honesty and Sincerity

9) Capability for assuming responsibility 9) Job Knowledge 10) Level of acceptance of subordinates 10) Organizational knowledge 11) Knowledge of Systems & Procedures 11) Quality of suggestions

Methods of Performance Appraisal

Traditional Methods

Modern Methods

Methods of Performance Appraisal

Traditional Methods 1) Straight ranking method 2) Graphic rating scales 3) Paired comparison method 4) Grading 5) Forced choice distribution method 6) Checklist method 7) Critical incident method 8) Group appraisal method 9) Free form or Essay method 10) Confidential reports

Methods of Performance Appraisal

Modern Methods 1) Behaviorally Anchored Rating Scales 2) Management by Objectives 3) Human Resource Accounting 4) Assessment Center 5) Psychological Appraisal

How to construct BARS 1)Collect critical incidents 2)Identify performance dimensions 3)Reclassification of incidents 4)Assigning scale values to the incidents 5)Producing the final instrument

Problems of Performance Appraisal  Halo Effect  Error of Central tendency  Leniency and Strictness  Personal Prejudice  The Recency Effect