This document discusses performance appraisal, including definitions, purposes, objectives, methods, and advantages/disadvantages. Performance appraisal is defined as the systematic evaluation of an employee's job performance and potential. Its main purposes are to review performance, identify training needs, and assist with decisions on promotions, transfers, etc. Common methods include confidential reports, rating scales, checklists, and 360-degree feedback. Advantages include improving performance and career development, while disadvantages include potential for bias and subjective evaluations.
2. DEFINITION
Performance appraisal is the systematic, periodic and an impartial rating of an
employee’s excellence in the matters pertaining to his present job and his potential
for a better job.“
It is the process of evaluating the performance of employees, sharing that information
with them and searching for ways to improve their performance.
3. PURPOSE OF PERFORMANCE APPRAISAL
To review the performance of the employees.
To judge the gap between the actual and the desired performance.
To help the management in exercising organizational control.
To diagnose the training and development needs of the future.
Provide information to assist in the HR decisions like promotions,
transfers etc.
4. CONTINUE…
Provide clarity of the expectations and
responsibilities of the functions to be performed by
the employees.
To judge the effectiveness of the other human
resource functions.
To reduce the grievances of the employees.
Helps to strengthen the relationship and
communication between superior –subordinates and
management – employees.
5. OBJECTIVES OF PERFORMANCE APPRAISAL
WORK RELATED OBJECTIVES
To provide a control for work done
To improve efficiency
To help in assigning work and plan
future work assignment; and
To carry out job evaluation
CAREER DEVELOPMENT
OBJECTIVES
To identify strong and weak points and
encourage finding remedies for weak
points through training
To determine career potential
To plan developmental( promotional or
lateral) assignments; and
To plan career goals
6. CONTINUE…
OBJECTIVES OF COMMUNICATION
To provide adequate feedback on
performance
To clearly establish goals, i.e. what is
expected of the staff members in terms of
performance and future work assignments
To provide counseling and job satisfaction
through open discussion on performance
and
To let employees assess where they stand
within the organization in terms of their
performance.
ADMINISTRATIVE
OBJECTIVES
To serve as a basis for
promotion or demotion;
To serve as a basis for
allocating incentives;
To serve as a basis for
determining transfers ; and
To serve as a basis for
termination in case of
reduction of staff.
7. PERFORMANCE APPRAISAL: USES
Performance improvement
Compensation adjustments
Placement decisions
Training & Development needs
Career planning & development
Identify deficiencies in staffing process
Detect informational inaccuracies
Diagnose job design errors
Avoidance of discrimination
External challenges
9. METHODS OF APPRAISING PERFORMANCE
Performance Appraisal
Traditional Methods
1. Confidential Report
2. Free Form or Essay
3. Straight Ranking
4. Paired Comparisons
5. Forced Distribution
6. Graphic rating Scales
7. Checklist Method
8. Critical Incidents
9. Group Appraisal
10. Field Review
Modern Methods
1. Assessment Centre
2. Human Resource Accounting
3. Behaviorally Anchored rating Scales
4. Appraisal through MBO
5. 360o Feedback Method
10. Confidential Report
This is a traditional form of appraisal used in most government organization.
A confidential report is a report prepared by the employee’s immediate superior.
It cover the strengths and weaknesses, main achievements and failure, personality and
behavior of the employee.
It is descriptive appraisal used for promotion and transfers of employees.
Free Form or Essay Method
Under this method, the evaluator writes a short essay on the employee’s performance
the basis of overall impression.
The description is expected to be as factual and concrete as possible.
An essay 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.
11. Straight Ranking Method
This is one of the oldest and simplest techniques of performance appraisal.
In this method, the appraiser ranks the employees from the best to the poorest on the
basis of their overall performance.
It is quite useful for a comparative evaluation.
Paired Comparisons Method
Herein, each employee is compared will all the others in pairs one at a time.
The number of times an employee is judged better then the others determines his
Comparison is made on the basis of overall performance.
This method is not applicable when the group is large.
12. Forced Distribution Method
In this technique, the rater is required to distribute his rating in the form of a normal
frequency distribution.
Here also ranking technique is used.
This method is highly simple to understand and easy to apply.
Graphic Rating Scale
In this method, an employee’s quality and quantity of work is assessed in a graphic
scale indicating different degrees of a particular trait.
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 trait like Job Knowledge may be judged on the range of average,
average, outstanding or unsatisfactory.
14. Checklist Method
Checklist contains a list of statements on the basis of which the rater describes the on job
performance of the employees.
Example:
Is employee regular Y/N
Is employee respected by subordinate Y/N
Is employee helpful Y/N
Does he follow instruction Y/N
Does he keep the equipment in order Y/N
Critical Incidents Methods
In this method of Performance appraisal the evaluator rates the employee on the basis of
critical events and how the employee behaved during those incidents.
It includes both negative and positive points.
The drawback of this method is that the supervisor has to note down the critical incidents
and the employee behavior as and when they occur.
15. Group Appraisal Method
Under this method, a group of evaluators assesses employees.
This group consists of the immediate supervisor of the employee, other supervisor
having close contact with employee’s work, head of the department and a personnel
expert.
The group determines the standers of performance for the job , measures actual
performance of an employee, analyses the causes of poor performance and offers
suggestions for improvement in future.
Field review
In this method, a senior member of the Human Resource department or a training
officer discusses and interviews the supervisors to evaluate and rate their respective
subordinates.
A major drawback of this method is that it is a very time consuming method.
But this method helps to reduce the superiors’ personal bias.
16. Assessment centre
Use of methods like social/informal events, tests and exercises, assignments being given to a
group of employees to assess their competencies to take higher responsibilities in the future.
Generally, employees are given an assignment similar to the job they would be expected to
perform if promoted.
The trained evaluators observe and evaluate employees as they perform the assigned jobs
are evaluated on job related characteristics.
Human resource accounting method
Human resources are a valuable asset of any organization and can be valued in terms of
money.
When competent, and well-trained employees leave an organization the human asset is
decreased and vice versa.
Under this method performance is judged in terms of costs and contribution of employees.
Costs of human resources consist of expenditure on human resource planning, recruitment,
selection, training, compensation, etc.
17. Behaviorally Anchored Rating Scales
Is a relatively new technique which combines the graphic rating scale and critical incidents
method.
It consists of predetermined critical areas of job performance or sets of behavioral
statements describing important job performance qualities as good or bad.
In this method, an employee’s actual job behavior is judged against the desired behavior
recording and comparing the behavior with BARS.
18. Management by Objectives (MBO)
First step: MBO emphasizes collectively set goals that are tangible, verifiable, and
measurable
Second step: setting the performance standard for the subordinates
Third step: the actual level of goal attainment is compared with the goals agreed upon
Final step: involves establishing new goals and possibly new strategies for goals not
previously achieved
19.
20. 360o Feedback Method
It is a systematic collection and feedback of performance data on an individual or group,
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.
It makes the employee feel much more accountable.