Doranda College, Ranchi

Department of Management
Semester: I Unit: V
Subject: Principles & Practices of Management

Staffing:

Meaning of Staffing:

After organising the business operations, staffing involves matching the jobs with people. While
organising creates jobs, staffing makes people suitable to jobs. Staffing deals with appointing people and
placing them at the appropriate jobs. It is “filling, and keeping filled, positions in the organisation
structure.”

Staffing is related to performing a set of activities which aim at inviting, selecting, placing and retaining
individuals at various jobs to achieve the organisational goals. It involves determining the need for people
at various organisational posts, appointing and retaining them at those posts by training and developing
their abilities and skills. This is done by performing a number of functions like manpower planning,
recruitment, selection, training and development, performance appraisal, compensation and maintenance.

Nature of Staffing:

The following features explain the nature of staffing:

1. Management function:

Staffing is a management function that appoints people at different positions to run the organisation.
While organising creates departments and positions, staffing ensures that people with desired skills and
abilities occupy these positions to contribute to organisational goals.

2. Pervasive function:

People are the most important asset that convert inputs into outputs. People are appointed at all levels
(top, middle, low) in all functional areas (production, finance, marketing, personnel). Staffing ensures that
right persons are appointed at the right job so that organisation can efficiently achieve its objectives.

3. Part of human resource management:

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Staffing is an important part of human resource management. Human resource management ensures that
competent people perform organisational activities. It deals with the set of organisational activities that
attract, develop and maintain an effective workforce. The requirements of human resource management
are filled through staffing as staffing appoints people at the desired jobs.

4. Deals with active resource:

Staffing deals with the most important resource (people) that converts inactive resources (raw materials)
into productive outputs. It deals with the live resource (people) without whom resources would remain as
resources only. They will not be converted into outputs.

5. Attached with personnel department:

Functions of staffing; recruitment, selection, training and appraisal of subordinates of all departments
(production, marketing etc.) are performed by managers at all levels as all departments need people to
function. In performing these functions, managers seek assistance of the personnel department. Personnel
department is a service department that assists line managers in performing the staffing function.

6. Continuous function:

Staffing is a continuous managerial function. People keep leaving and joining the organisations.
Departments and organisations grow and, therefore, need for people keeps arising. Hiring, training and
compensating people (staffing) are, therefore, continuously performed by managers.

Need for Staffing& objectives:

Staffing provides manpower to the organisation. In the changing, dynamic environment where
organisational size is increasing, technology is developing and human behaviour is becoming complex,
staffing function has become important. Need for staffing explains the objectives of staffing.

These objectives are as follows:

1. To achieve organisational objectives by recognising its most valuable resource; work force.

2. To increase loyalty and commitment of workers towards individual and organisational goals.
3. To select people with suitable qualifications to fill organisational posts.
4. To increase skills of people on-the-job by providing training facilities.
5. To develop abilities of the staff to assume jobs of higher skill, competence and responsibility.

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 6. To establish equitable and adequate compensation for people by providing them monetary and
non-monetary incentives. This promotes active contribution to organisational objectives.
7. To reconcile individual, organisational and social interests by maintaining efficient system of
communication in the organisation.
8. To provide physical working conditions (lighting, ventilation, recreation facilities etc.) to
maintain employees’ commitment to jobs.
9. To maintain record of achievements so that managers can make policies with respect to transfers,
promotions and demotions.
10. To make optimum use of human resource to achieve organisational objectives.
11. To make people realise their potential at work and develop them for promotion to higher
managerial posts.
12. To maintain an environment of teamwork and innovation.

Staffing function is important for the following reasons:

1. Emphasis on human element:

Human force is the most important and productive asset of the organisation which carries out the
functions and productive activities of various departments. People are the primary source of
productivity gains. “If you want productivity and financial reward that goes with it, you must
treat your workers as your most important asset.” — Thomas Peters and Robert Waterman

2. Facilitates leadership:

Well conducted staffing function provides leadership facilities so that individuals can satisfy their
personal goals along with organisational goals. Employee turnover has become a matter of
concern for many companies at higher levels as talented workforce is always on the look-out for
better job opportunities. Besides filling the organisational posts, thus, the staffing function also
ensures that the posts remain filled. A good leadership role helps in synthesizing individual goals
with organisational goals.

3. Facilitates control:

Well trained staff works according to plans and deviations in performance are reduced. This helps
managers in controlling various organisational functions.

4. Motivation to work:

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Financial rewards do not always motivate the employees. Their acceptance and recognition by
managers are also strong forces of motivation. When emphasis is placed on human element in the
organisation, people are motivated to contribute to goals of the organisation.

5. Increase in efficiency:

Since staffing helps to place the right person, with the right knowledge, at the right place and the
right time to perform the organisational activities, efficiency of the organisation increases. If
people are not competent to do their jobs, organisational goals will not be fully achieved. Though
people are appointed at specific job positions, there may be changes in their job profile because of
changing environmental conditions.

In order to avoid skills obsolescence and, thus, loss to the organisation, there should be
continuous training and development programmes to develop skills of the employees. Employees
have to be developed for multiple skills and competencies and not specific skills to increase
organisational efficiency.

6. Develops potential managers:

Recruiting and selecting people with the best potential, compensating and training them to
develop future managers facilitates movement of managerial abilities from lower to higher levels
of the organisation.

7. Competitive advantage:

In the era of globalisation, every enterprise faces tough competition from national and
international competitors. A well-staffed organisation provides management sound policies and
procedures for adapting to the environment and face competition. The fast changing technology
can be adopted by organisations only if the manpower is trained to do so.

Contemporary organisations are learning organisation with knowledge-based workers who use
information at their work place to meet challenges and risks. They create intangible assets for the
organisation and make effective strategic decisions by using their judgement and innovative
abilities. They are duty-conscious and a product of vision, farsightedness and intuitive skills.

They even subordinate their self-interest in favour of the larger organisational interest.
Knowledge workers create and enhance the competitive advantage by satisfying customers’ needs
through organisation’s knowledge base. Staffing function, thus, ensures that organisational
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 leaders align knowledge management with intellectual capital. It combines organisation’s
capabilities with needs of the market.

Staffing Process

It is a truth that human resource is one of the greatest for every organization because in any organization all
other resources like- money, material, machine etc. can be utilized effectively and efficiently by the positive
efforts of human resource.

Therefore it is very important that each and every person should get right position in the organization so as to
get the right job, according to their ability, talent, aptitude, and specializations so that it will help the
organization to achieve the pre-set goals in the proper way by the 100% contribution of manpower.

Steps involved in Staffing Process

1. Manpower Planning

2. Recruitment

3. Selection

4. Placement

5. Training

6. Development

7. Promotion

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 8. Transfer

9. Appraisal

10. Determination of Remuneration

Now, the process of Staffing can be explained in the following ways as follows-

1. Manpower Planning

Manpower planning can be regarded as the quantitative and qualitative measurement of labour force required
in an enterprise. Therefore, in an overall sense, the planning process involves the synergy in creating and
evaluating the manpower inventory and as well as in developing the required talents among the employees
selected for promotion advancement

2. Recruitment

Recruitment is a process of searching for prospective employees and stimulating them to apply for jobs in the
organization. It stands for finding the source from where potential employees will be selected.

3. Selection

Selection is a process of eliminating those who appear unpromising. The purpose of this selection process is
to determine whether a candidate is suitable for employment in the organization or not. Therefore, the main
aim of the process of selection is selecting the right candidates to fill various positions in the organization. A
well-planned selection procedure is of utmost importance.

4. Placement

Placement means putting the person on the job for which he is selected. It includes introducing the employee
to his job.

5. Training

After selection of an employee, the important part of the programmed is to provide training to the new
employee. With the various technological changes, the need for training employees is being increased to keep
the employees in touch with the various new developments.

6. Development

A sound staffing policy provides for the introduction of a system of planned promotion in every organization.
If employees are not at all having suitable opportunities for their development and promotion, they get
frustrated which affect their work.

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7. Promotions

The process of promotion implies the up-gradation of an employee to a higher post involving increasing rank,
prestige and responsibilities. Generally, the promotion is linked to increment in wages and incentives but it is
not essential that it always relates to that part of an organization.

8. Transfer

Transfer means the movement of an employee from one job to another without increment in pay, status or
responsibilities. Therefore this process of staffing needs to evaluated on a timely basis.

9. Appraisal

Appraisal of employees as to how efficiently the subordinate is performing a job and also to know his
aptitudes and other qualities necessary for performing the job assigned to him.

10. Determination of Remuneration

This is the last process which is very crucial as it involves in determining remuneration which is one of the
most difficult functions of the personnel department because there are no definite or exact means to determine
correct wages.

Manpower planning process:

According to Vetter, the process by which management determines how the organisation should move
from its current manpower position to its desired manpower position. Through planning, management
strives to have the right number and the right kinds of people, at the right places, at the right time, doing
things which result in both the organisation and the individual receiving maximum long-run benefit.
Coleman has defined human resource or manpower planning as “the process of determining manpower
requirements and the means for meeting those requirements in order to carry out the integrated plan of the
organisation.”

Process of Manpower Planning:

Deciding goals or objectives

(B) Auditing of the internal resources
(C) Formulation of the recruitment plan
(D) Estimating future organisational structure and manpower requirements
(E) Developing a human resource plan

A. Deciding Goals or Objectives: The business objectives have been determined; planning of manpower
resources has to be fully integrated into the financial planning. It becomes necessary to determine how the
human resources can be organised to achieve these objectives.For this purpose, a detailed organisation
chart is drawn and the management of the company tries to determine “how many people, at what level, at
what positions and with what kind of experience and training would be required to meet the business
objectives during the planning period.” The management of this company considers a time 5 pan of five
years as an optimum period for this purpose.

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It stresses the specific and standard occupational nomenclature must be used without which “it would not
be possible to build a firm-cum-industry-wise manpower resources planning.” It suggests the adoption for
this purpose of the international coding of occupations. For a sound manpower planning it considers as a
prerequisite the preparation of a manual of job classification and job description with specific reference to
individual jobs to be performed.

B. Audit of the Internal Resources:

The next step consists of an audit of the internal resources. A systematic review of the internal resources
would indicate persons within the organisations who possesses different or higher levels of
responsibilities. Thus it becomes necessary to integrate into the manpower planning process a sound
system of performance appraisal as well as appraisal of potential of existing employees.

C. Formulation of the Recruitment Plan:

A detailed survey of the internal manpower resources can ultimately lead to as assessment of the deficit or
surplus of personnel for the different levels during the planned period. Whilst arriving at the final figures,
it is necessary to take into account the “actual retirements and estimated loss due to death, ill health and
turnover, based on past experience and future outlook in relation to company’s expansion and future
growth patterns.”

D. Estimating Future Organisational Structure and Manpower Requirements:

The management must estimate the structure of the organisation at a given point of time. For this
estimate, the number and type of employees needed have to be determined. Many environmental factors
affect this determination. They include business forecast, expansion and growth, design and structural
changes, management philosophy, government policy, product and human skills mix, and competition.

E. Developing of Human Resource Plan:

This step refers to the development and implementation of the human resource plan, which consists in
finding out the sources of labour supply with a view to making an effective use of these sources. The first
thing, therefore, is to decide on the policy— should the personnel be hired from within through
promotional channels or should it be obtained from an outside source.
The best policy which is followed by most organisations is to fill up higher vacancies by promotion and
lower level positions by recruitment from the labour market. The market is a geographical area from
which employers recruit their work force and labour seeks employment.

Job Analysis

Job Analysis is a primary tool to collect job-related data. The process results in collecting and recording
two data sets including job description and job specification. Any job vacancy can not be filled until and
unless HR manager has these two sets of data. It is necessary to define them accurately in order to fit the
right person at the right place and at the right time. This helps both employer and employee understand
what exactly needs to be delivered and how.

Both job description and job specification are essential parts of job analysis information. Writing them
clearly and accurately helps organization and workers cope with many challenges while onboard.

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Though preparing job description and job specification are not legal requirements yet play a vital role in
getting the desired outcome. These data sets help in determining the necessity, worth and scope of a
specific job.

Job Description

Job description includes basic job-related data that is useful to advertise a specific job and attract a pool of
talent. It includes information such as job title, job location, reporting to and of employees, job summary,
nature and objectives of a job, tasks and duties to be performed, working conditions, machines, tools and
equipments to be used by a prospective worker and hazards involved in it.

Purpose of Job Description

▪ The main purpose of job description is to collect job-related data in order to advertise for a
particular job. It helps in attracting, targeting, recruiting and selecting the right candidate for the
right job.
▪ It is done to determine what needs to be delivered in a particular job. It clarifies what employees
are supposed to do if selected for that particular job opening.
▪ It gives recruiting staff a clear view what kind of candidate is required by a particular department
or division to perform a specific task or job.
▪ It also clarifies who will report to whom.

Job Specification

Also known as employee specifications, a job specification is a written statement of educational

qualifications, specific qualities, level of experience, physical, emotional, technical and communication
skills required to perform a job, responsibilities involved in a job and other unusual sensory demands. It

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also includes general health, mental health, intelligence, aptitude, memory, judgment, leadership skills,
emotional ability, adaptability, flexibility, values and ethics, manners and creativity, etc.

Purpose of Job Specification

▪ Described on the basis of job description, job specification helps candidates analyze whether are
eligible to apply for a particular job vacancy or not.
▪ It helps recruiting team of an organization understand what level of qualifications, qualities and
set of characteristics should be present in a candidate to make him or her eligible for the job
opening.
▪ Job Specification gives detailed information about any job including job responsibilities, desired
technical and physical skills, conversational ability and much more.
▪ It helps in selecting the most appropriate candidate for a particular job.

Job description and job specification are two integral parts of job analysis. They define a job fully and
guide both employer and employee on how to go about the whole process of recruitment and selection.
Both data sets are extremely relevant for creating a right fit between job and talent, evaluate performance
and analyze training needs and measuring the worth of a particular job.

Recruitment: Meaning and Sources of Recruitment

Whenever there is a vacancy in the organization, generally it is to be filled. To make the candidate avail-
able for filling those vacancies, their selection procedure and placement on a proper job comes under the
purview of recruitment.

As soon as the available vacancies are known, they are advertised through different media and
accordingly the applications are collected for the vacant posts. A group of candidates interested in doing
the job and are eligible to do, it is created through recruitment.

Sources of Recruitment:

The eligible and suitable candidates required for a particular job are available through various sources.

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Internal Sources of Recruitment:

1. Promotions:

The promotion policy is followed as a motivational technique for the employees who work hard and show
good performance. Promotion results in enhancements in pay, position, responsibility and authority. The
important requirement for implementation of the promotion policy is that the terms, conditions, rules and
regulations should be well-defined.

2. Retirements:

The retired employees may be given the extension in their service in case of non-availability of suitable
candidates for the post.

3. Former employees:

Former employees who had performed well during their tenure may be called back, and higher wages and
incentives can be paid to them.

4. Transfer:

Employees may be transferred from one department to another wherever the post becomes vacant.

5. Internal advertisement:

The existing employees may be interested in taking up the vacant jobs. As they are working in the
company since long time, they know about the specification and description of the vacant job. For their
benefit, the advertisement within the company is circulated so that the employees will be intimated.

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External Sources of Recruitment:

1. Press advertisement:

A wide choice for selecting the appropriate candidate for the post is available through this source. It gives
publicity to the vacant posts and the details about the job in the form of job description and job
specification are made available to public in general.

2. Campus interviews:

It is the best possible method for companies to select students from various educational institutions. It is
easy and economical. The company officials personally visit various institutes and select students eligible
for a particular post through interviews. Students get a good opportunity to prove themselves and get
selected for a good job.

3. Placement agencies:

A databank of candidates is sent to organizations for their selection purpose and agencies get commission
in return.

4. Employment exchange:

People register themselves with government employment exchanges with their personal details.
According to the needs and request of the organization, the candidates are sent for interviews.

5. Walk in interviews:

These interviews are declared by companies on the specific day and time and conducted for selection.

6. E-recruitment:

Various sites such as jobs.com, naukri.com, and monster.com are the available electronic sites on which
candidates upload their resume and seek the jobs.

7. Competitors:

By offering better terms and conditions of service, the human resource managers try to get the employees
working in the competitor’s organization.

Selection

Definition: The Selection is the process of choosing the most suitable candidate for the vacant position in
the organization. In other words, selection means weeding out unsuitable applicants and selecting those
individuals with prerequisite qualifications and capabilities to fill the jobs in the organization.

Most often, the selection and recruitment are used interchangeably but however both have different scope.
The former is a negative process that rejects as many unqualified applicants as possible so as to hire the
right candidate while the latter is a positive process that attracts more and more candidates and stimulates
them to apply for the jobs.

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Based on the complexity of selecting the right candidate the selection process is comprised of several
steps:

1. Preliminary Interview
2. Receiving Applications
3. Screening of Applications
4. Employment Tests
5. Interview
6. Reference Checking
7. Medical Examination
8. Final Selection

Significance of Selection

The company should follow a proper selection procedure as huge amount of money is invested in
selecting the right candidate for the job. Also, the cost incurred in training and induction programme is
too high that the wrong selections could lead to a huge loss to the employer in terms of the time, effort
and money.

Absenteeism and labor turnover are the grim situation for any organization and if the candidates are not
selected appropriately, then these problems will increase and the overall efficiency of the organization
will go down.

Different Types of Interviews

Type # 1. Patterned, Structured or Guided Interview:

This is the most common method of interview. It is a preplanned interview and more carefully designed to
have a high degree of accuracy, precision and exactide. Under this type of interview a list of questions to
be asked by the interviewer is prepared in advance on the basis of job specification, and to secure
information from the candidate.

The questions would be asked in a particular order with very little deviation, ideal and standard answers
to the set questions are also determined in advance. Therefore there is no scope for bias on the part of the
interviewer. An adequate opportunity is given to the candidate to express his ideas and viewpoints.

The main purpose of this type of interview is fact-finding and not awarding a judgment. It measures
personality, motivation and interest of the candidate, because this information cannot be secured from
elsewhere. This type of interview is useful in selection of semi-skilled employees. It is also called as
directed or standardised interview. It assists in proper evaluation of the personality, attitude and
motivation of the candidate. It guards against faulty conclusion, due to bias.

Type # 2. Unstructured or Unguided Interview:

It is an unstructured and non-planned interview. Therefore it is called as “non-directed interview” also. It

is designed to let the interviewee speak his mind freely. The idea is to give candidate complete freedom to
sell himself without the encumbrances of the interviewer’s questions. It is not directed by pre-determined
list of questions.

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It is very flexible in nature, candidate feels very comfortable and free. Full freedom is given to him to
discuss and express his points of view and ideas. The basic objectives of this type of interview are to find
out the feeling, desire or problems of the candidate.

The interviewers look for trait of character and nature of his (candidate’s) aspiration and his strength and
weakness, manifest or potential. For conducting such type of interview, interviewer must be highly skilled
and competent. This type of interview is more often used in situation other than hiring such a counselling,
processing of grievances and exit interviews.

Type # 3. Depth Interview:

The object of this interview is to examine intensively the candidates’ background and thinking and to go
into considerable details on particular subject of an important nature and of social interest of the
candidate. It is semi structured in nature and questions are used in key areas, which have been studied in
advance by the interviewer.

The typical subjects are discussed in such type of interview. The interviewer, as well, provides
instructional information about his organisation, the nature of work, pay, opportunities for advancement
and demands likely to be made on the employee. The capability of performance of the candidate in the
specific area of work can be well-judged by asking relevant questions by the specialist interviewers.

Type # 4. Stress Interview:

Under this type of interview the strain is put on the candidate deliberately. It is designed to test the
candidate and his conduct and behaviour by putting him under conditions of stress and strain, Usually the
interviewer in such a stress circumstances asks questions rapidly, criticizes the interviewee’s answers,
interrupts him frequently, too many questions are asked at a time by many interviewers, makes negative
remarks, tries to put him in an awkward situation, and carefully watches the interviewee’s emotional
stability and balance.

The purpose of the interview is to find out how the candidate behaves in a stress situation and see whether
he loses his temper, gets confused or frightened. This type of interview does not necessarily reveal how a
candidate will behave in real stressful life situations involved on job.

Type # 5. Group Interview:

It is also called as Discussion Interview. In this type of interview, groups rather than individuals are
interviewed. A group of candidates (interviewees) is given certain problem and is asked to come to
specific decision within a given time. The interviewer sits over there and watches the interviewees.

The candidates enter into group discussion. The interviewer observes as to who has assumed leadership
and the process by which leadership is exercised and how it is accepted by the other members of the
group. Group interview is generally conducted in a situation where leadership ability is to be observed.

Group interview is resorted to for selecting management personnel. The object of this interview is, to see
how well individuals perform on the particular task or in a particular situation. It is designed to save time,
labour and cost and to see how the candidates react to and against each other.

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Type # 6. Panel or Board Interview:

In panel or board interview, candidate is screened by a group of interviewers who are specialists in their
respective fields. This type of interview is just opposite to “Group Interview.” A candidate is interviewed
by a number of interviewers, and the questions are asked by them in serial or in random order.

The interviewee is required to answer and to have dialogue with many interviewers at a time. This may
cause pressure on the candidate. This is not a good practice. This type of interview pools the collective
judgement and wisdom of the panel of interviewers in the assessment of the candidate. The members of
panel of board jointly evaluate the performance of the candidate.

Type # 7. Formal Interview:

Formal interview may be held in the employment department by the employment officer in a more formal
atmosphere with the help of pre-planned questions and schedule, with predetermined procedures and
practices. It may also be called as “planned Interview”.

Type # 8. Informal Interview:

It is an oral interview that may take place anywhere. Usually when staff is required urgently on some
specific job, this type of interview is conducted. Informal interview is not at all pre-planned and
scheduled. Informally the questions are asked to the candidates.

Type # 9. Exit Interview:

The exit interview is generally conducted at the time when an employee is leaving the business
organisation. The objective behind this interview is to know the opinion, view and feelings of the
outgoing employee regarding his job and organisation, and later on to develop/improve such policies in
the light of deficiency so discovered.

Performance Appraisal Methods

The employee performance appraisal process is crucial for organizations to boost employee productivity
and improve their outcomes. But although performance management is super important, it’s rarely put to
good use. Many companies don’t put in their best effort to pick the best perfect performance appraisal
method, which is why only 55 percent of employees believe theirs is effective.

What are performance appraisals?

Performance appraisals are an annual process that involves evaluating employee’s performance and
productivity against the pre-determined set of objectives for that year. It also helps to evaluate employee’s
skills, strength and shortcomings. The results of this performance appraisal process determines the
employees wage raise and promotion.
The objectives of performance appraisal varies from company to company and depending on the
industry/company size, the appraisal method varies.

The need for modern performance appraisal methods

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Traditional methods of performance appraisals such as annual performance reviews suffer from major
limitations since they focus more on measuring past performance rather than improving future work. But
on the contrary modern performance appraisal methods helps:
• Define goals clearly
• Provide real-time feedback
• Enhance employee performance
• Spot training and development needs
• Offer insights on counter-productive tasks
• Improve employee engagement and retention
• Align individual performance with business goals
• Transform the workforce into a strategic advantage

Six modern performance appraisal methods

With the right performance appraisal method, organizations can enhance employee performance within
the organization. A good employee performance review method can make the whole experience effective
and rewarding. Now that the drawbacks of traditional methods are clear.

1. Management by Objectives (MBO)

Management by objectives (MBO) is the appraisal method where managers and employees together
identify, plan, organize, and communicate goals. After setting clear goals, managers and subordinates
periodically discuss the progress made to control and debate on the feasibility.
This process usually lays more stress on tangible work or career-oriented goals. So, intangible aspects like
interpersonal skills, job commitment, etc. are often brushed under the rug. This method is slightly
expensive and time-intensive.

2. 360-Degree Feedback
Once-in-a-year performance appraisals are lackadaisical and don’t work. Workers need ongoing
communication with team leaders and managers. A continuous process, like 360-degree feedback, can
help employees stay motivated. This is one of the most widely used appraisal methods.
In 360-degree feedback, every employee in an organization appraises his/her managers, peers, customers,
suppliers, and also does a self-evaluation. This method ensures effective performance analysis and Total
Employee Involved (TEI). If not handled properly, this method can also suffer from the subjectivity of the
appraiser.

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3.Assessment Centre Method

The assessment centre method tests employees in a social-related situation. This concept was introduced
way back in 1930 by the German Army but it has been polished and tailored to fit today’s environment.
Employees are asked to take part in situation exercises like in-basket exercises, work groups, simulations,
and role-playing exercises that ensure success in a role.
While it gives an insight of the employee’s personality (ethics, tolerance, problem-solving skill,
introversion/extroversion, adaptability, etc.), it can also breed unhealthy competition among the workers
and bears adverse effects on low performers.

4. Behaviorally Anchored Rating Scale (BARS)

Behaviorally anchored rating scales (BARS) bring out both the qualitative and quantitative benefits in a
performance appraisal process. BARS compares employee performance with specific behavioral
examples that are anchored to numerical ratings.

This performance appraisal method is said to be better than the traditional methods. BARS provides clear
standards, improved feedback, accurate performance analysis, and consistent evaluation. However, when
done manually it suffers from the usual distortions that are inherent in most review methodologies.

5. Psychological Appraisals
Psychological appraisals come in handy to determine the hidden potential of employees. This method
focuses on analyzing an employee’s future performance rather than their past work.
Qualified psychologists conduct a variety of tests (in-depth interviews, psychological tests, discussions,
and more) to identify an employee’s emotional, intellectual, and other related traits. However, it is a
rather slow and complex process and the quality of results is highly dependent on the psychologist who
administers the procedure.

6. Human-Resource (Cost) Accounting Method

Human resource (cost) accounting method analyses an employee’s performance through the monetary
benefits he/she yields to the company. It is obtained by comparing the cost of retaining an employee (cost
to company) and the monetary benefits (contributions) an organization has ascertained from that specific
employee.

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When an employee’s performance is evaluated based on cost accounting methods, factors like unit-wise
average service value, quality, overhead cost, interpersonal relationships, and more are taken into account.
Its high-dependency on the cost and benefit analysis and the memory power of the reviewer is the
drawback of human resources accounting method.

Traditional Methods:

Ranking Method:

It is the oldest and simplest formal systematic method of performance appraisal in which employee is
compared with all others for the purpose of placing order of worth. The employees are ranked from the
highest to the lowest or from the best to the worst.
In doing this the employee who is the highest on the characteristic being measured and also the one who
is L lowest, are indicated. Then, the next highest and the next lowest between next highest and lowest
until all the employees to be rated have been ranked. Thus, if there are ten employees to be appraised,
there will be ten ranks from 1 to 10.

Paired Comparison:
In this method, each employee is compared with other employees on one- on one basis, usually based on
one trait only. The rater is provided with a bunch of slips each coining pair of names, the rater puts a tick
mark against the employee whom he insiders the better of the two. The number of times this employee is
compared as better with others determines his or her final ranking.

Grading Method:
In this method, certain categories of worth are established in advance and carefully defined. There can be
three categories established for employees: outstanding, satisfactory and unsatisfactory. There can be
more than three grades. Employee performance is compared with grade definitions. The employee is,
then, allocated to the grade that best describes his or her performance.
Such type of grading is done is Semester pattern of examinations and in the selection of a candidate in the
public service sector. One of the major drawbacks of this method is that the rater may rate most of the
employees on the higher side of their performance.

Forced Distribution Method:

This method was evolved by Tiffen to eliminate the central tendency of rating most of the employees at a
higher end of the scale. The method assumes that employees’ performance level confirms to a normal
statistical distribution i.e., 10,20,40,20 and 10 per cent. This is useful for rating a large number of
employees’ job performance and promo ability. It tends to eliminate or reduce bias.
It is also highly simple to understand and easy to apply in appraising the performance of employees in
organisations. It suffer from the drawback that improve similarly, no single grade would rise in a ratings.

Forced-Choice Method:
The forced-choice method is developed by J. P. Guilford. It contains a series of groups of statements, and
rater rates how effectively a statement describes each individual being evaluated. Common method of
forced-choice method contains two statements, both positive and negative.

Check-List Method:
The basic purpose of utilizing check-list method is to ease the evaluation burden upon the rater. In this
method, a series of statements, i.e., questions with their answers in ‘yes’ or ‘no’ are prepared by the HR
department (see Figure 28-2). The check-list is, then, presented to the rater to tick appropriate answers
relevant to the appraisee. Each question carries a weight-age in relationship to their importance.

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However, one of the disadvantages of the check-list method is that it is difficult to assemble, analyse and
weigh a number of statements about employee characteristics and contributions From a cost stand point
also, this method may be inefficient particularly if there are a number of job categories in the
organisation, because a check-list of questions must be prepared for each category of job. It will involve a
lot of money, time and efforts.

This method is good for measuring various job behaviours of an employee. However, it is also subjected
to rater’s bias while rating employee’s behaviour at job. Occurrence of ambiguity in design- mg the
graphic scale results in bias in appraising employee’s performance.

Essay Method:
Essay method is the simplest one among various appraisal methods available. In this method, the rater
writes a narrative description on an employee’s strengths, weaknesses, past performance, potential and
suggestions for improvement. Its positive point is that it is simple in use. It does not require complex
formats and extensive/specific training to complete it.
However, essay method, like other methods, is not free from drawbacks. In the absence of any prescribed
structure, the essays are likely to vary widely in terms of length and content. And, of course, the quality of
appraisal depends more upon rater’s writing skill than the appraiser’s actual level of performance.
Moreover, because the essays are descriptive, the method provides only qualitative information about the
employee. In the absence of quantitative data, the evaluation suffers from subjectivity problem.
Nonetheless, the essay method is a good start and is beneficial also if used in conjunction with other
appraisal methods.

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Field Review Method:
When there is a reason to suspect rater’s biasedness or his or her rating appears to be quite higher than
others, these are neutralised with the help of a review process. The review process is usually conducted by
the personnel officer in the HR department.
The review process involves the following activities:
(a) Identify areas of inter-rater disagreement.
(b) Help the group arrive at a consensus.
(c) Ensure that each rater conceives of the standard similarity.
However, the process is a time-consuming one. The supervisors generally resent what they consider the
staff interference. Hence, the method is not widely used.

Confidential Report:
It is the traditional way of appraising employees mainly in the Government Departments. Evaluation is
made by the immediate boss or supervisor for giving effect to promotion and transfer. Usually a
structured format is devised to collect information on employee’s strength weakness, intelligence,
attitude, character, attendance, discipline, etc. report.

Job Evaluation: Concept, Objectives

Job evaluation is the rating of jobs in an organisation. This is the process of establishing the
value or worth of jobs in a job hierarchy. It attempts to compare the relative intrinsic value or
worth of jobs within an organisation. Thus, job evaluation is a comparative process.

Job evaluation provides basis for developing job hierarchy and fixing a pay structure. It must be
remembered that job evaluation is about relationships and not absolutes. That is why job
evaluation cannot be the sole determining factor for deciding pay structures.

External factors like labour market conditions, collective bargaining and individual differences
do also affect the levels of wages it, organisations. Nonetheless, job evaluation can certainly
provide an objective standard from which modifications can be made in fixing wage structure

The objectives & significance of job evaluation

1.Provide a standard procedure for determining the relative worth of each job in a plant.
2. Determine equitable wage differentials between different jobs in the organisation.
3. Eliminate wage inequalities.
4.Ensure that like wages are paid to all qualified employees for like work.
5. Form a basis for fixing incentives and different bonus plans.
6. Serve as a useful reference for setting individual grievances regarding wage rates.
7. Provide information for work organisation, employees’ selection, placement, training and
numerous other similar problems.
8. Provide a benchmark for making career planning for the employees in the organisation.

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 Job Evaluation Methods
There are non-analytical and analytical job evaluation methods that are employed by the
organizations to realize the worth of a set of jobs.

Non-analytical Job Evaluation Methods

1. Ranking Method: This is the simplest and an inexpensive job evaluation method, wherein the
jobs are ranked from he highest to the lowest on the basis of their importance in the organization.
In this method, the overall job is compared with the other set of jobs and then is given a rank on
the basis of its content and complexity in performing it.

Here the job is not broken into the factors, an overall analysis of the job is done. The main
advantage of the ranking method is, it is very easy to understand and is least expensive. But
however it is not free from the limitations, it is subjective in nature due to which employees may
feel offended, and also, it may not be fruitful in the case of big organizations.

2. Job Grading Method: Also known as Job-Classification Method. Under this method the job
grades or classes are predetermined and then each job is assigned to these and is evaluated
accordingly.

For Example Class, I, comprise of the managerial level people under which sub-classification is
done on the basis of the job roles such as office manager, department managers, departmental
supervisor, etc.The advantage of this method is that it is less subjective as compared to the raking
method and is acceptable to the employees. And also, the entire job is compared against the other
jobs and is not broken into factors. The major limitation of this method is that the jobs may differ

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 with respect to their content and the complexity and by placing all under one category the results
may be overestimated or underestimated.

Analytical Job Evaluation Methods

1. Factor-Comparison Method: Under this method, the job is evaluated, and the ranks are given
on the basis of a series of factors Viz. Mental effort, physical effort, skills required supervisory
responsibilities, working conditions, and other relevant factors. These factors are assumed to be
constant for each set of jobs. Thus, each job is compared against each other on this basis and is
ranked accordingly.The advantage of this method is that it is consistent and less subjective, thus
appreciable by all. But however it is the most complex and an expensive method.

2. Point-Ranking Method: Under this method, each job’s key factor is identified and then the subfactors
are determined. These sub-factors are then assigned the points by its importance.For example, the key
factor to perform a job is skills, and then it can be further classified into sub-factors such as training
required, communication skills, social skills, persuasion skills, etc.The point ranking method is less
subjective and is an error free as the rater sees the job from all the perspectives. But however it is a
complex method and is time-consuming since the points and wage scale has to be decided for each factor
and the sub factors.

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