PERFORMANCE

EVALUATION
1. Determine the purpose of appraisal

2. Identify environmental and cultural As needed

limitations
3. Determine who will evaluate
performance
4. Select the best appraisal methods to
accomplish goals

5. Train raters Annually

6. Observe and document performance

7. Evaluate performance

8. Communicate appraisal results to

employees

9. Make personnel decisions

STEP 1. Determine the Reason for
Evaluating Employee Performance
To what end do you see performance appraisal will benefit
employees and the organization?

1. Improve Performance
2. Salary Raise
3. Promotion
Providing Employee Training and Feedback
One use of performance appraisal is to improve employee
performance by providing feedback about what employees
are doing right and wrong.
 Determining Salary Increases
One basic reason for evaluating employee performance is to
provide a fair basis on which to determine an employees
salary increase.
 Making Promotion Decisions
Determination of which employee to promote based on
performance.
Peter Principle
the promotion of employees until they reach their
highest level of incompetence.
 Making Termination Decisions
When performance management techniques are not
successful, the result of a performance review might
suggest that the best course of action is to terminate the
employee.
 Conducting Personnel Research
Correlating tests scores to some measure of job
performance.
STEP 2. Identify Environmental and
Cultural Limitations
Time
Money
STEP 3. Determine Who Will Evaluate
Performance
360° Feedback
 Supervisors
Though supervisors may not see every minute of an
employee’s behavior, they do see the end result.
 Peers
Peers see the actual behavior of employees as they work
directly with them.
 Subordinates
also known as upward feedback, is considered one
important component of 360-degree feedback, as
subordinates can provide a different view about the
supervisor’s behavior.
 Customers
Organizations get feedback from customers thru customer
feedback questionnaires and secret shoppers.
 Self-Appraisal
This allows the employee to evaluate his own
behavior and performance.
Problems with Self Appraisal

Self
Leniency
Modesty

When is self
appraisal accurate?
 STEP 4. Select the Best Appraisal
Methods to Accomplish Your Goals
 Ranking

CRITERIA

Rating
Decision 1: Focus of the Appraisal
Dimensions
Four Ways to Focus Performance Dimensions (Police Officer)
Competency Focus Task Focus
Report-writing skills Crime Prevention
Driving skills Arrest procedures
Public speaking skills Court testimony
Knowledge of the law Use of vehicle
Decision making skills procedures

Goal Focus Trait Focus

Prevent crimes from occurring Honesty
Arrest/cite lawbreakers Courtesy
Finish shift without injury Responsibility
Minimize citizen complaints Assertiveness
Ensure public safety Cooperation

Appraisal dimensions can focus on traits,

competencies, task types, or goals.
 Trait-Focused Dimensions
A trait-focused system concentrates on such
employee attributes as dependability, honesty, and
courtesy.
 Competency-Focused Dimension
Concentration is on knowledge, skills, and abilities.
 Task-Focused Dimensions
Task-focused dimensions are organized by the
similarity of tasks that are performed.
 Goal-Focused Performance
This dimension is organized on the basis of goals to be
accomplished by the employee.
 Contextual Performance
Contextual performance concentrates on the effort of the
employee to get along with peers, improve organization, and
perform tasks that are needed but not necessarily official.
Decision 2: Should Dimensions Be
Weighted?
Decision 3: Use Employee Comparisons,
Objective Measures, or Ratings
 Employee Comparisons
The easiest and most common method is rank order,
by which employees are ranked in order by their
judged performance for each relevant dimension.
Employee Dimension Total

Knowledge Dependability Quality

Santos 1 1 1 1
Atienza 2 3 2 2.33
Escueta 3 2 3 2.67
Rivera 4 4 4 4

Rank Order
Paired comparison involves comparing each possible
pair of employees and choosing which one of each
pair is the better employees.
Employees
1. Santos 3. Escueta
2. Atienza 4. Rivera
Paired Comparisons: Encircle the better employee in each pair
Santos Atienza
Santos Escueta
Santos Rivera
Atienza Escueta
Atienza Rivera
Escueta Rivera

Scoring No. of Times Name Circled

1. Santos 3
2. Atienza 2
3. Escueta 1
4. Rivera 0
 Forced distribution method (also rank and yank)
assigns a predetermined percentage of employees in
a distributed set of category.
Forced Distribution Method of Performance Appraisal

10% 20% 40% 20% 10%

Terrible Below Average Average Good Excellent

Diaz Lee Tan Garcia Santos

Rivera Escueta Atienza
Ignacio
Uy
Objective Measures
 Quantity of Work
Evaluation of a worker’s performance in terms of
quantity is obtained by simply counting the number
of relevant job behaviors that take place.
 Quality of Work
Quality is measured in terms of errors which are
defined as deviations from a standard.
 Attendance
A common method for measuring one aspect of an
employee’s performance is by looking at attendance.
 Safety
Employees who follow safety rules and who have no
occupational accidents do not cost the organization.
Ratings of Performance
 Ratings of Performance
1. Behavioral checklist
2. Comparison with other Employees
3. Frequency of desired behavior
4. Extent to which organizational expectations are
met.
STEP 5. Train Raters
 Frame-of-Reference Training
Frame-of-reference training provides raters with job related
information, practice in rating, and examples of rating made
by experts as well as the rationale behind those expert
ratings.
STEP 6. Observe and Document
Performance
Document critical incidents
 Critical Incidents
Critical incidents are examples of excellent and poor
employee performance.
Documentation is important for four reasons…
1. Documentation forces a supervisor to focus on
employee behaviors rather traits and provides
behavioral examples to use.
2. Documentation helps supervisors recall behaviors
when they are evaluating performance.
Without documentation, supervisors tend to recall
only a small percentage of an employee’s actual
behavior.
First impressions
Recent behaviors
Unusual or extreme behavior
Behavior consistent with the supervisor’s opinion
3. Documentation provides examples to use when
reviewing performance ratings with employees.
4. Documentation helps an organization defend against
legal actions taken against it by an employee who was
terminated or denied a raise or promotion.
STEP 7. Evaluate Performance
 Obtaining and Reviewing Objective Data
To appraise an employee’s performance, a supervisor
should obtain and review the objective data relevant to the
employee’s behavior.
Number of Number of
Failed Number of
New Clients
Accounts Delinquent
Accounts

No. of Deals
Closed No. of
Absences
 Type of Performance

Dimension Poor Excellent

Knowledge

Employee
Relations
Customer
Relations
Accuracy of
Work
Reading Critical Incidents Log
Reading incidents may reduce errors of primacy,
recency, and attention to unusual errors.
Completing the Rating Form
Consider the following rating errors…
Distribution Error
is made when a rater uses only one part of a rating scale.
- Leniency error
- Central tendency error
- Strictness error
Halo Errors
A halo error occurs when a rater allows either a single
attribute or an overall impression of an individual to affect
the ratings that she makes on each relevant job dimension.
Proximity Error
occurs when a rating made on a dimension affects the
rating made on the dimension that immediately follows it
on the rating scale.
Contrast Error
states that the performance rating one person receives can
be influenced by the performance of a previously evaluated
person.
Low Reliability Across Raters
Two people rating the same employee seldom agree with
each other. There are three major reasons for this lack of
reliability: (1) rating errors; (2) differences in standards; and
(3) raters may see different behaviors by the same
employee.
Sampling Problems
Recency Effect
Infrequent Observation
Cognitive Processing of Observed Behavior
1. Observation of behavior
2. Emotional state
3. Bias
STEP 8. Communicate Appraisal Results to
Employees
 Tell and Sell
The tell and sell approach to performance appraisal
interviews, a supervisor “tells” an employee he has done
poorly, and then “sells” him on ways he can improve.
1. Prior to the Interview
- Allocating time
- Scheduling the interview
- Preparing for the interview
2. During the Interview
Supervisors should communicate the following:
1. The role of performance appraisal
2. How the performance appraisal was conducted
3. How the evaluation process was accomplished
4. The expectation that the appraisal interview will be
interactive
5. The goal of understanding and improving
performance
STEP 9. Terminate Employees
 Legal Reasons for Terminating Employees
There are only four reasons an employee can be legally
terminated: probationary period, violation of company
rules, inability to perform, and an economically caused
reduction in force (layoffs).
 1. Probationary Period
is the period by which the employee is given a chance
to prove that he/she can perform the job.
Employees Police Officers Professors
6 months 1 year 2 to 3 years
 2. Violation of Company Rules
The legality of a decision to terminate an employee is
determined by five factors
A rule against a particular behavior must exist.
If a rule exist, the company must prove that the
employee knew the rule.
The employer must prove that the employee actually
violated the rule.
It must be proven that the rule has been equally
enforced.
Punishment for the violation of the rule must fit the
crime.
 Progressive Discipline
refers to the reasonable attempt to change the person’s
behavior gradually.
 3. Inability to Perform
The employer needs to prove that the employee could not
perform the job.
 4. Reduction in Force (Layoffs)
Employers can terminate employees if it is in the best
economic interest of an the organization to do so.
The Termination Meeting
1. Prior to the meeting
- Ensure that all legal process has been followed;
- Determine how much help the organization wants
to offer; and
- Schedule the appropriate meeting place and time
for the meeting to occur.
2. During the Meeting
The supervisor should get to the point of terminating the
employee.
3. After the Meeting
Once the meeting is over, the natural reaction of the
supervisor is to feel guilty. The supervisor should review
facts.