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INTRODUCTION OF PERFORMANCE APPRAISAL

Performance appraisal goes by various names such as performance evaluation,progress rating ,merit rating, merit evaluation etc Performance appraisal means systematic evaluation of the personality and performance of each employee by his supervisor or some other person trend in technique of merit rating. It employs various rating techniques qualities and deficiencies and the requirements of their respective jobs. Performance appraisal includes all formal procedures used to evaluate personalities and contributions and potentials of group member in a working organization. It is a continuous process to secure information necessary for making correct and objective decision on employees. A performance appraisal, employee appraisal, performance review, or (career) development discussion is a method by which the job performance of an employee is evaluated (generally in terms of quality, quantity, cost, and time) typically by the corresponding manager or supervisor. A performance appraisal is a part of guiding and managing career development. It is the process of obtaining, analyzing, and recording information about the relative worth of an employee to the organization. Performance appraisal is an analysis of an employee's recent successes and failures, personal strengths and weaknesses, and suitability for promotion or further training. It is also the judgment of an employee's performance in a job universal abased on considerations other than productivity alone. Performance appraisal measures the qualitative and quantitative aspects of job performance. An appraisal evaluates not only the employee's performance but also his potential for development. The primary objectives of an appraisal are to assess past performance, to identify training needs, to set and agree on future objectives and standards, and to facilitate the achievement of these goals. Performance appraisal or merit rating is one of the oldest and most practices of management. It refers to all the formal procedures used in working organization to the personality and contributions of group members. Modern management makes

somewhat less use of the term merit rating than was common in earlier periods. In the past emphasis used to be on the evaluation of merits of the individuals- his worth as a person. The approach resulted in an appraisal system in which the employees merit like initiative, dependability, personality etc were compared with others and ranked and rated.

HISTORY OF PERFORMANCE APPRAISAL


The history of performance appraisal is quite brief. Its roots in the early 20th century can be traced to Taylor's pioneering Time and Motion studies. But this is not very helpful, for the same may be said about almost everything in the field of modern human resources management. As a distinct and formal management procedure used in the evaluation of work performance, appraisal really dates from the time of the Second World War - not more than 60 years ago. Yet in a broader sense, the practice of appraisal is a very ancient art. In the scale of things historical, it might well lay claim to being the world's second oldest profession! There is, says Dulewicz (1989), "... a basic human tendency to make judgements about those one is working with, as well as about oneself." Appraisal, it seems, is both inevitable and universal. In the absence of a carefully structured system of appraisal, people will tend to judge the work performance of others, including subordinates, naturally, informally and arbitrarily. The human inclination to judge can create serious motivational, ethical and legal problems in the workplace. Without a structured appraisal system, there is little chance of ensuring that the judgements made will be lawful, fair, defensible and accurate. Performance appraisal systems began as simple methods of income justification. That is, appraisal was used to decide whether or not the salary or wage of an individual employee was justified. The process was firmly linked to material outcomes. If an employee's performance was found to be less than ideal, a cut in pay would follow. On the other hand, if their performance was better than the supervisor expected, a pay rise was in order. Little consideration, if any, was given to the developmental possibilities of appraisal. If was felt that a cut in pay, or a rise, should provide the only required impetus for an employee to either improve or continue to perform well. Sometimes this basic system succeeded in getting the results that were intended; but

more often than not, it failed. For example, early motivational researchers were aware that different people with roughly equal work abilities could be paid the same amount of money and yet have quite different levels of motivation and performance. These observations were confirmed in empirical studies. Pay rates were important, yes; but they were not the only element that had an impact on employee performance. It was found that other issues, such as morale and self-esteem, could also have a major influence. As a result, the traditional emphasis on reward outcomes was progressively rejected. In the 1950s in the United States, the potential usefulness of appraisal as tool for motivation and development was gradually recognized. The general model of performance appraisal, as it is known today, began from that time.

Modern Appraisal
Performance appraisal may be defined as a structured formal interaction between a subordinate and supervisor, that usually takes the form of a periodic interview (annual or semi-annual), in which the work performance of the subordinate is examined and discussed, with a view to identifying weaknesses and strengths as well as opportunities for improvement and skills development. In many organizations - but not all - appraisal results are used, either directly or indirectly, to help determine reward outcomes. That is, the appraisal results are used to identify the better performing employees who should get the majority of available merit pay increases, bonuses, and promotions. By the same token, appraisal results are used to identify the poorer performers who may require some form of counseling, or in extreme cases, demotion, dismissal or decreases in pay. (Organizations need to be aware of laws in their country that might restrict their capacity to dismiss employees or decrease pay.) Whether this is an appropriate use of performance appraisal - the assignment and justification of rewards and penalties - is a very uncertain and contentious matter.

DEFINITION BY DIFFERENT AUTHORS


According to Alford and Beatty, "It is the evaluation or appraisal of the relative worth to the company of a man's service on the job".

According the flipper, "Performance Appraisal is a systematic, periodic and so far as humanly possible and impartial rating of employee's excellence of matters pertaining to his potentialities for a better job". According to Dale Yoder, it is a more comprehensive process, which combines formal ratings with supplementary observations records and evaluation

PUPOSE OF PERFORMANCE APPRAISAL

Help to achieve organizations task through guided efforts of indivisual

Provides data for evolving development plans for indivisuals

Provides input for decisions on transfers,promotion etc

Performance appraisal system

Enables clarification of expectation between superior and subordinate

Provides data in term of needs aspiration of indivisuals to review company policies and structure

PURPOSE OF PERFORMANCE APPRAISAL


It can be serve as a basis for job change or promotion. By identifying the strength and weaknesses of an employee it serves as a guide for formulating a suitable training and development program to improve the quality of performance. It servers as a feedback to the employee. It serves as a important incentive to all the employees who are by the existence of an appraisal system assured of the managements continued interest in them and of their continuous possibility of develop. Performance appraisal often provide the rational foundation for the payment of piece work wages,bonus etc. Performance appraisal serves as means for evaluating the effectiveness if the device used for the selection and classification of workers.

BASIC FUNCTION OF PERFORMANCE APPRAISAL


1. To provide adequate feedback to staff members on their performance 2. To serve as an opportunity to communicate face-to-face modifications or changes to existing performance objectives 3. To provide data to administrators so they can evaluate a staff member and judge future job assignments and compensation

Fundamentals of an appraisal system


To develop a successful performance appraisal system, two criteria need to be met: Relevance and applicability to everyday work practice Acceptability to appraisers and workers.

LIMITATION OF PERFORMANCE APPRAISAL


Performance appraisal may not yield the desired result because of the following deficiencies: If the factors included in the assessment are irrelevant, the result of merit rating will not be accurate. Different qualities to be rated may not be given proper weightage certain in cases. Some of the factor are highly subjective like initiative and personality of the employees; so the actual rating may not be in scientific lines. Supervisors often do not have critical ability in assessing the staff. Sometimes, they are guided by personal emotions and likes. So the rating are likely to be biased

METHODS OF PERFORMANCE APPRAISAL

Performance appraisal

Traditional methods 1. Unstructured appraisal 2. Employee Ranking 3. Forced distribution 4. Graphics-Rating scale 5. Check lists 6. Critical incidents 7. Field review

Mordern Methods 1. Management by Objective 2.Behaviourally Anchored rating Scale 3. 360 Degree Appraisal 4. Assessment Center

TRADITIONAL METHOD
Traditional methods are very old technique of performance appraisal. They are based on trait oriented appraisal. Evaluation of employees is Done on the basis of standard of personal traits or qualities suchas attitudes, judgment, versatility, initiative, dependability, leadership, loyalty, punctuality, knowledge of job etc.

UNSTRUCTURED APPRAISAL
Under this, the appraiser is required to write down his impression about the person being appraised in an unstructured way. However, in some organization, comment are required to be grouped under specific headings such as quality of job performance, reasons for specific job behaviours, personality traits, and development needs, This system is highly subjective and has got its merit in its simplicity and is still in use especially in the small firms.

RANKING METHOD
The oldest and simplest methods of performance appraisal is to compare one man will all other men and place him in a simple rank order. In this way ordering is done from the best to worst of all individuals comprising the group. The methods is both simple and natural but it disadvantage are: It is highly subjective Comparison of the various component of a persons is not done. People are compared as whole The magnitude of difference in ability between ranks is not equal at different position. For instance, the difference in ability between the fifth and sixth individuals may be much greater than the difference between the sixth and

seventh. In terms of ranks, however, the differencebetween these indivisuals is the same Its use is difficulty in large groups when the rater cannot compare several people simultaneously. As an answer to this problem the paired comparison method of ranking has been evolved. In this method the rater compares each man in his group with every other man, with the final ranking of each worker determined by the number of times he has judged better than the others. The number of comparisons involved in this methods is thus very large and can becdetermined by the following formula: Number Of Comparison: N(N-1)/2 Where N stands for the number of men to be rated For a 50 man group for example there would be i225 seprate comparisons which is obviously for too great to permit expedient use of the method Following is a work sheet which shows how paired comparisions can be made in a 6 man work group. Each employee has been compared with other employees and when ever he has been found more productive a checkmark has been placed. Thus A on comparision B C D E and F has been found more productive than B,D, and E and less productive then C and F. Therefore As total number of checks is 3. In our example C stand first followed by F,A,B,D and E.

3 2 5 1 o 4

RATING-SCALE METHODS
The rating scale method offers a high degree of structure for appraisals. Each employee trait or characteristic is rated on a bipolar scale that usually has several points ranging from "poor" to "excellent" (or some similar arrangement). The traits assessed on these scales include employee attributes such as cooperation, communications ability, initiative, punctuality and technical (work skills) competence. The nature and scope of the traits selected for inclusion is limited only by the imagination of the scale's designer, or by the organization's need to know. The one major provision in selecting traits is that they should be in some way relevant to the appraisee's job. The traits selected by some organizations have been unwise and have resulted in legal action on the grounds of discrimination.

ADVANTAGES OF RATING-SCALE METHODS


The greatest advantage of rating scales is that they are structured and standardised. This allows ratings to be easily compared and contrasted - even for entire workforces. Each employee is subjected to the same basic appraisal process and rating criteria, with the same range of responses. This encourages equality in treatment for all appraisees and imposes standard measures of performance across all parts of the organization. Rating scale methods are easy to use and understand. The concept of the rating scale makes obvious sense; both appraisers and appraisees have an intuitive appreciation for the simple and efficient logic of the bipolar scale. The result is widespread acceptance and popularity for this approach.

DISADVANTAGE OF RATING-SCALE METHODS


Trait Relevance
Are the selected rating-scale traits clearly relevant to the jobs of all the appraisees? It is inevitable that with a standardised and fixed system of appraisal that certain traits will have a greater relevance in some jobs than in others. For example, the trait "initiative" might not be very important in a job that is tightly defined and rigidly structured. In such cases, a low appraisal rating for initiative may not mean that an employee lacks initiative. Rather, it may reflect that fact that an employee

has few opportunities to use and display that particular trait. The relevance of rating scales is therefore said to be context-sensitive. Job and workplace circumstances must be taken into account.

Systemic Disadvantage
Rating scales, and the traits they purport to measure, generally attempt to encapsulate all the relevant indicators of employee performance. There is an assumption that all the true and best indicators of performance are included, and all false and irrelevant indicators are excluded. This is an assumption very difficult to prove in practice. It is possible that an employee's performance may depend on factors that have not been included in the selected traits. Such employees may end up with ratings that do not truly or fairly reflect their effort or value to the organization. Employees in this class are systemically disadvantaged by the rating scale method.

Perceptual Errors
This includes various well-known problems of selective perception (such as the horns and halos effect) as well as problems of perceived meaning. Selective perception is the human tendency to make private and highly subjective assessments of what a person is "really like", and then seek evidence to support that view (while ignoring or downplaying evidence that might contradict it). This is a common and normal psychological phenomenon. All human beings are affected by it. In other words, we see in others what we want to see in them. An example is the supervisor who believes that an employee is inherently good (halo effect) and so ignores evidence that might suggest otherwise. Instead of correcting the slackening employee, the supervisor covers for them and may even offer excuses for their declining performance. On the other hand, a supervisor may have formed the impression that an employee is bad (horns effect). The supervisor becomes unreasonably harsh in their assessment of the employee, and always ready to criticize and undermine them. The horns and halo effect is rarely seen in its extreme and obvious forms. But in its more subtle manifestations, it can be a significant threat to the effectiveness and credibility of performance appraisal.

Perceived Meaning
Problems of perceived meaning occur when appraisers do not share the same opinion about the meaning of the selected traits and the language used on the rating scales.

For example, to one appraiser, an employee may demonstrate the trait of initiative by reporting work problems to a supervisor. To another appraiser, this might suggest an excessive dependence on supervisory assistance - and thus a lack of initiative. As well, the language and terms used to construct a scale - such as "Performance exceeds expectations" or "Below average skill" - may mean different things to different appraisers.

Rating Errors
The problem here is not so much errors in perception as errors in appraiser judgement and motive. Unlike perceptual errors, these errors may be (at times) deliberate. The most common rating error is central tendency. Busy appraisers, or those wary of confrontations and repercussions, may be tempted to dole out too many passive, middle-of-the-road ratings (e.g., "satisfactory" or "adequate"), regardless of the actual performance of a subordinate. Thus the spread of ratings tends to clump excessively around the middle of the scale. This problem is worsened in organizations where the appraisal process does not enjoy strong management support, or where the appraisers do not feel confident with the task of appraisal.

FORCED DISTRIBUTION METHOD


A Forced distribution method consist of number of statements which described an individual being rated. These statements are grouped in twos, threes or fours. Sometimes all group on the rating form are made of favorable statement only, sometimes all have unfavorable statements only and sometimes they have both favorable and unfavorable statements. The rater makes two checks in each group, one for the statement which best describes the individual and one for the statement which is least descriptive. Examples of such groups of items are given below : GROUP 1 1. Always critises never praises. 2.Carries out orders by passing the buck. 3.Knows his job and performs it well. 4. Plays no favourites

GROUP 2 1. Cannot assume responsibility 2. Knows how and when to delegate 3. Offers suggestions. 4.Too easily changes his ideas

LIMITATIONS OF FORCED DISTRIBUTION METHOD


1. It is expensive to install because the statements must be custom-tailored to the demands of the particular job and company 2. It is resented by the rater because the implicit assumption behind it is that the rater cannot be trusted to make impartial evaluation.

Check list method


Sometimes the method used for performance appraisals is a list consisting of a number of statements about the worker and his behavior. Each statement on this list is assigned a value depending upon its importance. Both statements and their values are derived from preliminary research in which the pooled judgement of persons familiar with the job are used.

Limitation of checklist Methods


1) It is difficult to construct a good checklist. 2) A separate check list is needed for each job because statements used in ine checklist to evaluate one category of workers. 3) Since the rater does not know the values given to different statement, he may resent the system as a whole and may not given it his whole hearted support

Critical statement Method


The Critical Incident Technique (or CIT) is a set of procedures used for collecting direct observations of human behavior that have critical significance and meet methodically defined criteria. These observations are then kept track of as incidents,

which are then used to solve practical problems and develop broad psychological principles. A critical incident can be described as one that makes a significant contributioneither positively or negativelyto an activity or phenomenon. Critical incidents can be gathered in various ways, but typically respondents are asked to tell a story about an experience they have had. CIT is a flexible method that usually relies on five major areas. The first is determining and reviewing the incident, then fact-finding, which involves collecting the details of the incident from the participants. When all of the facts are collected, the next step is to identify the issues. Afterwards a decision can be made on how to resolve the issues based on various possible solutions. The final and most important aspect is the evaluation, which will determine if the solution that was selected will solve the root cause of the situation and will cause no further problems

FIELD REVIEW
The Critical Incident Technique (or CIT) is a set of procedures used for collecting direct observations of human behavior that have critical significance and meet methodically defined criteria. These observations are then kept track of as incidents, which are then used to solve practical problems and develop broad psychological principles. A critical incident can be described as one that makes a significant contributioneither positively or negativelyto an activity or phenomenon. Critical incidents can be gathered in various ways, but typically respondents are asked to tell a story about an experience they have had. CIT is a flexible method that usually relies on five major areas. The first is determining and reviewing the incident, then fact-finding, which involves collecting the details of the incident from the participants. When all of the facts are collected, the next step is to identify the issues. Afterwards a decision can be made on how to resolve the issues based on various possible solutions. The final and most important aspect is the evaluation, which will determine if the solution that was selected will solve the root cause of the situation and will cause no further problems

MORDERN TECHNIQUE MANAGEMENT BY OBJECTIVE


Management by Objectives (MBO) is a process of defining objectives within an organization so that management and employees agree to the objectives and understand what they need to do in the organization.

The term "management by objectives" was first popularized by Peter Drucker in his 1954 book 'The Practice of Management'. The essence of MBO is participative goal setting, choosing course of actions and decision making. An important part of the MBO is the measurement and the comparison of the employees actual performance with the standards set. Ideally, when employees themselves have been involved with the goal setting and choosing the course of action to be followed by them, they are more likely to fulfill their responsibilities. Management By Objective can be defined as a process whereby the employees and the superiors come together to identify common goals, the employees set their goals to be achieved, the standards to be taken as the criteria for measurement of their performance and contribution and deciding the course of action to be followed. The essence of MBO is participative goal setting, choosing course of actions and decision making. An important part of the MBO is the measurement and the comparison of the employees actual performance with the standards set. Ideally, when employees themselves have been involved with the goal setting and the choosing the course of action to be followed by them, they are likely to fulfill their responsibilities.

FEATURES AND ADVANTAGE OF MANAGEMENT BY OBJECTIVE


The basic principle behind Management by Objectives (MBO) is for employees to have a clear understanding of the roles and responsibilities expected of them. They can then understand how their activities relate to the achievement of the organization's goal. MBO also places importance on fulfilling the personal goals of each employee. Some of the important features and advantages of MBO are: 1. Motivation Involving employees in the whole process of goal setting and increasing employee empowerment. This increases employee job satisfaction and commitment. 2. Better communication and Coordination Frequent reviews and interactions between superiors and subordinates helps to maintain harmonious relationships within the organization and also to solve many problems. 3. Clarity of goals 4. Subordinates tend to have a higher commitment to objectives they set for themselves than those imposed on them by another person. 5. Managers can ensure that objectives of the subordinates are linked to the organization's objectives.

LIMITATION OF MANAGEMENT BY OBJECTIVE


There are several limitations to the assumptive base underlying the impact of managing by objectives, including: 1. It over-emphasizes the setting of goals over the working of a plan as a driver of outcomes. 2. It underemphasizes the importance of the environment or context in which the goals are set. That context includes everything from the availability and quality of resources, to relative buy-in by leadership and stake-holders. As an example of the influence of management buy-in as a contextual influencer, in a 1991 comprehensive review of thirty years of research on the impact of Management by Objectives, Robert Rodgers and John Hunter concluded that companies whose CEOs demonstrated high commitment to MBO showed, on average, a 56% gain in productivity. Companies with CEOs who showed low commitment only saw a 6% gain in productivity. 3. Companies evaluated their employees by comparing them with the "ideal" employee. Trait appraisal only looks at what employees should be, not at what they should do. When this approach is not properly set, agreed and managed by organizations, self-centered employees might be prone to distort results, falsely representing achievement of targets that were set in a short-term, narrow fashion. In this case, managing by objectives would be counterproductive. The use of MBO must be carefully aligned with the culture of the organization. While MBO is not as fashionable as it was before, it still has its place in management today. The key difference is that rather than 'set' objectives from a cascade process, objectives are discussed and agreed upon. Employees are often involved in this process, which can be advantageous. A saying around MBO -- "What gets measured gets done", Why measure performance? Different purposes require different measures -- is perhaps the most famous aphorism of performance measurement; therefore, to avoid potential problems SMART and SMARTER objectives need to be agreed upon in the true sense rather than set.

PROCESS OF MANAGEMENT BY OBJECTIVE

BEHAVIOURALLY ANCHORED RATING SCALE METHOD


Behaviorally anchored rating scales (BARS) is an appraisal method that measures behavior against levels of performance. BARS combine elements from critical incident and graphic rating scale approaches. The supervisor rates employees according to items on a numerical scale.BARS uses judgmental measures developed to define the rating points in relation to actual work behaviors. Behaviorally Anchored Rating Scales (BARS) are scales used to rate performance. BARS are normally presented vertically with scale points ranging from five to nine. It is an appraisal method that aims to combine the benefits of narratives, critical incidents, and quantified ratings by anchoring a quantified scale with specific narrative examples of good, moderate, and poor performance.

PROCESS OF BEHAVIOURALLY ANCHORED RATING SCALE METHOD


Generation of critical incidents (examples of effective and ineffective behavior). Refinement of the critical incidents and the creation of performance dimensions (the overall qualities defined by specific critical incidents). Verification check of the relationship of critical incidents to performance dimensions. Rating of the effectiveness of each incident as evidence of ones performance on the dimension. Assembling the final BARS form, often a 10-point scale constructed for each of the performance dimensions and placement of critical incidents in the scales. Some of the purposes of using BARS include:

Use as a decision aid Helping to manage changes to identify individuals for promotion & to facilitate lateral transfers To reward good performance: merit-based salary and benefits, promotions

Addressing poor performance: firing decisions To evaluate the effectiveness of other organizational programs

360 DEGREE APPRAISAL


In human resources or industrial/organizational psychology, 360-degree feedback, also known as multi-rater feedback, multisource feedback, or multisource assessment, 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. It also includes a self-assessment and, in some cases, feedback from external sources such as customers and suppliers or other interested stakeholders. It may be contrasted with "upward feedback," where managers are given feedback by their direct reports, or a "traditional performance appraisal," where the employees are most often reviewed only by their managers. The 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. When this is the case, the 360 assessment is for evaluation purposes, and is sometimes called a "360-degree review." However, there is a great deal of controversy as to whether 360degree feedback should be used exclusively for development purposes, or should be used for appraisal purposes as well (Waldman et al., 1998). There is also controversy regarding whether 360-degree feedback improves employee performance, and it has even been suggested that it may decrease shareholder value 360 degree feedback, also known as 'multi-rater feedback', is the most comprehensive appraisal where the feedback about the employees performance comes from all the sources that come in contact with the employee on his job. 360 degree respondents for an employee can be his/her peers, managers (i.e. superior), subordinates, team members, customers, suppliers/ vendors - anyone who comes into contact with the employee and can provide valuable insights and information or feedback regarding the "on-the-job" performance of the employee. 360 Degree Feedback is a system or process in which employees receive confidential, anonymous feedback from the people who work around them. This typically includes the employee's manager, peers, and direct reports. A mixture of about eight to twelve people fill out an anonymous online feedback form that asks questions covering a broad range of workplace competencies. The feedback forms include questions that are

measured on a rating scale and also ask raters to provide written comments. The person receiving feedback also fills out a self-rating survey that includes the same survey questions that others receive in their forms. Managers and leaders within organizations use 360 feedback surveys to get a better understanding of their strengths and weaknesses. The 360 feedback system automatically tabulates the results and presents them in a format that helps the feedback recipient create a development plan. Individual responses are always combined with responses from other people in the same rater category (e.g. peer, direct report) in order to preserve anonymity and to give the employee a clear picture of his/her greatest overall strengths and weaknesses. 360 Feedback can also be a useful development tool for people who are not in a management role. Strictly speaking, a "non-manager" 360 assessment is not measuring feedback from 360 degrees since there are no direct reports, but the same principles still apply. 360 Feedback for non-managers is useful to help people be more effective in their current roles, and also to help them understand what areas they should focus on if they want to move into a management role.

PURPOSE OF 360 DEGREE APPRAISALS


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360 feedback measures behaviors and competencies 360 assessments provide feedback on how others perceive an employee 360 feedback addresses skills such as listening, planning, and goal-setting A 360 evaluation focuses on subjective areas such as teamwork, character, and leadership effectiveness

LIMITATIONS OF 360 DEGREE APPRAISAL


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360 feedback is not a way to measure employee performance objectives (MBOs) 360 feedback is not a way to determine whether an employee is meeting basic job requirements 360 feedback is not focused on basic technical or job-specific skills 360 feedback should not be used to measure strictly objective things such as attendance, sales quotas, etc.

PROCESS OF 360 DEGREE APPRAISAL

INTRODUCTION OF 360 DEGREE APPRAISAL


360 degree feedback, also known as 'multi-rater feedback', is the most comprehensive appraisal where the feedback about the employees performance comes from all the sources that come in contact with the employee on his job. 360 degree respondents for an employee can be his/her peers, managers (i.e. superior), subordinates, team members, customers, suppliers/ vendors - anyone who comes into contact with the employee and can provide valuable insights and information or feedback regarding the "on-the-job" performance of the employee. 360 Degree Feedback is a system or process in which employees receive confidential, anonymous feedback from the people who work around them.

What is 360-degree feedback?


360-degree feedback is a full circle system of obtaining information from peers, subordinates, and internal and external customers, about the employee's performance. 360-degree assessment is based on the assessment of an individual's management styles, competencies and behaviour by colleagues horizontally and vertically by involving his boss, peers and direct reports in the organization.

360-degree feedback
Is a multi source assessment, which includes * Self, * Supervisor * Internal Customers/peers/Staffs * External Customers

Need of 360-degree feedback in organizations


Business is towards surplus generation. Without surplus no organization can grow. Here the effort to grow the business and the surplus should come from employee part. The performance of the employees is at work here matters in business development and organisational development. The performance of the employees should then align with the strategic decisions that integrate the business goals in an increasingly competitive environment. It is the responsibility of the Human Resource Management to integrate the culture of the organisation with all available resources to the optimum out put. The 3600 Appraisal helps the HR Department to have better understanding of the competitive advantage and disadvantages of the current manpower resources and tune them towards performance excellence and productivity.

Prerequisites
* Top Management Support * Confidence of employees on the appraisal methodology * Objectives need to be measurable with performance requirements clearly stated. * A detailed plan of implementation * Collaboration between superior and subordinates * Some prior experimentation and positive experiences Clear organisational philosophy and policy objectives

Uses for 360 Degree Feedback include:

Performance Appraisal
Recognition of performance. Providing feedback on individual performance. Providing a basis for self-evaluation.

Assessing Employee Development:


Diagnosing training and career development needs. Providing a basis for promotion, dismissal, job enrichment, job enlargement, job transfer, probation, etc. Monetary and other rewards.

Organizational Climate Study:


Organizational environment improvement needs Changes in the Managerial approaches, leadership, etc

Customer Satisfaction Study


Employees attitudinal change Customer satisfaction improvements

How 360-degree feedback system adds value?


360 degree feedback enables an organization to focus on developmental efforts, at the individual and group level, in the present business environment where the success of the company depends on continuous revolution, which is possible through organizational development. 360-degree feedback facilitates the alignment of individual capabilities and behaviors with organizational strategies. It adds value to the organization indifferent ways:-

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360-degree feedback provides a better understanding of individuals performance at work 360-degree feedback provides a multifaceted view about the employees from different sources 360-degree feedback provides a better understanding of employed developmental needs 360-degree feedback provides increased the understanding about one's role expectations. 360-degree feedback provides increased the understanding of competence and competency in various roles 360-degree feedback extends better morale to those who perform and contribute well to the organisation 360-degree feedback reduces training costs by identifying common development needs. 360-degree feedback increases the team's ability to contribute to the organizations goals 360-degree feedback helps everyone to work for a common standard and institutionalize performance management. 360-degree feedback ensure better interpersonal relationship and group cohesiveness It promotes self-directed learning and provides a road map for employee's development planning. It promotes better Communication within departments. 360-degree feedback Increases the team's ability to contribute to the organizations goals develop better bottom line through boosting the capability of the organization to meet its objectives.

Steps may be taken to gauge the readiness of an organization for 360degree feedback:
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Identification of the problem. Analysis of the organizational context for finding a solution to the problem. Allocation of resources for the purpose in terms of time and finances. A detailed plan of implementation. Follow up

Pitfalls of 360-degree feedback


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A detailed plan of action, which ensure the transparent and clear implementation of appraisal with employee accountability. Effective follow-up is the prime requirement of 360-degree feedback. Failure in follow-up may cause more harm than good. The 360-degree feedback is time consuming and cost consuming assessment process. Without having adequate resource to implement the process, it will end up nowhere and develop financial burden to organisation.

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The trust and confidence on the employees who undergo this feedback assessment process is a determinant factor in its outcome. Many consider this appraisal as tool for downsizing. The process involves a lot of paper work. There are high chances of subjectivity from the management and employee part in the feed back assessment. Many times the confidentiality of the appraisal cannot ensure from the HR department. Since the assessment is based on qualitative data many times it cannot ensure unambiguous, clear, specific, and observable and quantifiable formats.

INTRODUCTION OF JOB SATIAFACTION


While managing human resources, most of the executives face the problem of providing job satisfaction to the employees under their command. Job satisfaction is not the same as motivation. It is more of an attitude , an internal state of person concerned. Job satisfaction describes how content an individual is with his or her job. The happier people are within their job, the more satisfied they are said to be. Job satisfaction is not the same as motivation or aptitude, although it is clearly linked. Job design aims to enhance job satisfaction and performance, methods include job rotation, job enlargement, job enrichment and job re-engineering. Other influences on satisfaction include the management style and culture, employee involvement, empowerment and autonomous work position . Job satisfaction is a very important attribute which is frequently measured by organizations. The most common way of measurement is the use of rating scales where employees report their reactions to their jobs. Questions relate to rate of pay, work responsibilities, variety of tasks, promotional opportunities, the work itself and co-workers. Some questioners ask yes or no questions while others ask to rate satisfaction on 1-5 scale (where 1 represents "not at all satisfied" and 5 represents "extremely satisfied"). Job Satisfaction is the favorableness or un-favorableness with which the employee views his work. It expresses the amount of agreement between ones expectation of the job and the rewards that the job provides. Job Satisfaction is a part of life satisfaction. The nature of ones environment of job is an important part of life as Job Satisfaction influences ones general life satisfaction. Job Satisfaction, thus, is the result of various attitudes possessed by an employee. In a narrow sense, these attitudes are related to the job under condition with such specific factors such as wages. Supervisors of employment, conditions of work, social relation on the job, prompt settlement of grievances and fair treatment by employer. However, more comprehensive approach requires that many factors are to be included before a complete understanding of job satisfaction can be obtained. Such factors as employees age, health temperature, desire and level of aspiration should be considered. Further his family relationship, Social status, recreational outlets, activity in the organizations etc. Contribute ultimately to job satisfaction.

HISTORY
One of the biggest preludes to the study of job satisfaction was the Hawthorne studies. These studies (19241933), primarily credited to Elton Mayo of the Harvard Business

School, sought to find the effects of various conditions (most notably illumination) on workers productivity. These studies ultimately showed that novel changes in work conditions temporarily increase productivity (called theHawthorne Effect). It was later found that this increase resulted, not from the new conditions, but from the knowledge of being observed. This finding provided strong evidence that people work for purposes other than pay, which paved the way for researchers to investigate other factors in job satisfaction. Scientific management (aka Taylorism) also had a significant impact on the study of job satisfaction. Frederick Winslow Taylors 1911 book, Principles of Scientific Management, argued that there was a single best way to perform any given work task. This book contributed to a change in industrial production philosophies, causing a shift from skilled labor and piecework towards the more modern ofassembly lines and hourly wages. The initial use of scientific management by industries greatly increased productivity because workers were forced to work at a faster pace. However, workers became exhausted and dissatisfied, thus leaving researchers with new questions to answer regarding job satisfaction. It should also be noted that the work of W.L. Bryan, Walter Dill Scott, and Hugo Munsterberg set the tone for Taylors work. Some argue that Maslows hierarchy of needs theory, a motivation theory, laid the foundation for job satisfaction theory. This theory explains that people seek to satisfy five specific needs in life physiological needs, safety needs, social needs, self-esteem needs, and self-actualization. This model served as a good basis from which early researchers could develop job satisfaction theories. Job satisfaction can also be seen within the broader context of the range of issues which affect an individual's experience of work, or their quality of working life. Job satisfaction can be understood in terms of its relationships with other key factors, such as general well-being, stress at work, control at work, home-work interface, and working conditions.

DEFINITION
The term job satisfaction is commonly used by the academicians and the ex-ecutives. In the word of Feldman and Arnold, job satisfaction is the amount of overall positive effect or feeling that indivisuals have towards their jobs.

job satisfaction is the amount of pleasure or contentment associated with a job. If you like your job intensely, you will experience high job satisfaction. If you dislike your job intensely, you will experience job satisfaction. Job satisfaction is an individuals emotional reaction to the job itself. It is his attitude towards his job.

FACTORS INFLUENCING JOB SATISFACTION SUPERVISION


To a worker, Supervision is equally a strong contributor to the job satisfaction as well as to the job dissatisfaction. The feelings of workers towards his supervisors are usually similar to his feeling towards the company. The role of supervisor is a focal point for attitude formation. Bad supervision results in absenteeism and labor turnover. Good supervision results in higher production and good industrial relations.

CO-WORKERS
Various studies had traced this factor as a factor of intermediate importance. Ones associates with others had frequently been motivated as a factor in job satisfaction. Certainly, this seems reasonable because people like to be near their friends. The workers derive satisfaction when the co-workers are helpful, friendly and co-operative.

PAY Studies also show that most of the workers felt satisfied when they are paid more adequately to the work performed by them. The relative important of pay would probably changing factor in job satisfaction or dissatisfaction. AGE Age has also been found to have a direct relationship to level job of satisfaction of employees. In some groups job satisfaction is higher with increasing age, in other groups job satisfaction is lower and in other there is no difference at all.

MARITAL STATUS
Marital status has an important role in deciding the job satisfaction. Most of the studies have revealed that the married person finds dissatisfaction in his job

than his unmarried counterpart. The reasons stated to be are that wages were insufficient due to increased cost of living, educations to children etc .

EDUCATION
Studies conducted among various workers revealed that most of workers who had not completed their school education showed higher satisfaction level. However, educated workers felt less satisfied in their job.

WORKING CONDITION
The result of various studies shows that working condition is an important factor. Good working atmosphere and pleasant surroundings help increasing the production of industry. Working conditions are more important to women workers than men workers.

DIMENSION OF JOB SATISFACTION


Job satisfaction is a complex concept and difficult to measure objectively. The level of job satisfaction is affected by a wide range of variables relating to individual, social, cultural, organizational and environmental factors as stated below: 1) Individual factors: personality, education, intelligence and abilities,age,marital status,prientation to work. 2) Social factors: Relationship with co-workers, group working and norms, opportunities for interaction, informal relation, etc. 3) Cultural factors: attitudes, beliefs and values. 4) Organizational factors: Nature and size , formal structure, personnel policies and procedures, industrial relations, nature of work, technology and work organization, supervision and style of leadership, management system and working condition. 5) Environmental factors: Economic, social, technical and governmental influences.

MODELS OF JOB SATISFACTION


Affect Theory
Edwin A. Lockes Range of Affect Theory (1976) is arguably the most famous job satisfaction model. The main premise of this theory is that satisfaction is determined by a discrepancy between what one wants in a job and what one has in a job. Further, the theory states that how much one values a given facet of work (e.g. the degree of autonomy in a position) moderates how satisfied/dissatisfied one becomes when expectations are/arent met. When a person values a particular facet of a job, his satisfaction is more greatly impacted both positively (when expectations are met) and negatively (when expectations are not met), compared to one who doesnt value that facet. To illustrate, if Employee A values autonomy in the workplace and Employee B is indifferent about autonomy, then Employee A would be more satisfied in a position that offers a high degree of autonomy and less satisfied in a position with little or no autonomy compared to Employee B. This theory also states that too much of a particular facet will produce stronger feelings of dissatisfaction the more a worker values that facet.

Dispositional Theory
Another well-known job satisfaction theory is the Dispositional Theory Template:Jackson April 2007. It is a very general theory that suggests that people have innate dispositions that cause them to have tendencies toward a certain level of satisfaction, regardless of ones job. This approach became a notable explanation of job satisfaction in light of evidence that job satisfaction tends to be stable over time and across careers and jobs. Research also indicates that identical twins have similar levels of job satisfaction. A significant model that narrowed the scope of the Dispositional Theory was the Core Self-evaluations Model, proposed by Timothy A. Judge in 1998. Judge argued that there are four Core Self-evaluations that determine ones disposition towards job satisfaction: self-esteem, general self-efficacy, locus of control, and neuroticism. This model states that higher levels of self-esteem (the value one places on his/her self) and general self-efficacy (the belief in ones own competence) lead to higher work satisfaction. Having an internal locus of control (believing one has control over her\his

own life, as opposed to outside forces having control) leads to higher job satisfaction. Finally, lower levels of neuroticism lead to higher job satisfaction.

Two-Factor Theory (Motivator-Hygiene Theory)


Frederick Herzbergs Two factor theory (also known as Motivator Hygiene Theory) attempts to explain satisfaction and motivation in the workplace This theory states that satisfaction and dissatisfaction are driven by different factors motivation and hygiene factors, respectively. An employees motivation to work is continually related to job satisfaction of a subordinate. Motivation can be seen as an inner force that drives individuals to attain personal and organizational goals (Hoskinson, Porter, & Wrench,). Motivating factors are those aspects of the job that make people want to perform, and provide people with satisfaction, for example achievement in work, recognition, promotion opportunities. These motivating factors are considered to be intrinsic to the job, or the work carried out.Hygiene factors include aspects of the working environment such as pay, company policies, supervisory practices, and other working conditions. While Hertzberg's model has stimulated much research, researchers have been unable to reliably empirically prove the model, with Hackman & Oldham suggesting that Hertzberg's original formulation of the model may have been a methodological artifact. Furthermore, the theory does not consider individual differences, conversely predicting all employees will react in an identical manner to changes in motivating/hygiene factors. Finally, the model has been criticized in that it does not specify how motivating/hygiene factors are to be measured.

Job Characteristics Model


Hackman & Oldham proposed the Job Characteristics Model, which is widely used as a framework to study how particular job characteristics impact on job outcomes, including job satisfaction. The model states that there are five core job characteristics (skill variety, task identity, task significance, autonomy, and feedback) which impact three critical psychological states (experienced meaningfulness, experienced responsibility for outcomes, and knowledge of the actual results), in turn influencing work outcomes (job satisfaction, absenteeism, work motivation, etc.).The five core job characteristics can be combined to form a motivating potential score (MPS) for a job, which can be used as an index of how likely a job is to affect an employee's attitudes and behaviors----. Ameta-

analysis of studies that assess the framework of the model provides some support for the validity of the JCM.

RELATIONSHIP BETWEEN SATISFACTION AND PRODUCTIVITY

WORK HARD TO FORGET PRODUCTIVITY TROUBLES

WORK HARD WHEN SATISFIED

HAPPIEST WHEN TAKING THINGS EASY

SATISFACTION

RELATION BETWEEN SATISFACTION AND PRODUCTIVITY

Satisfaction leads to performance, a view associated with the early human


relationship approach.

The relationship between satisfaction and performance is moderated y anumber


of variables, a view which is reflected in a research studies.

A more recent view that performance leads to satisfaction.

MEASURING JOB SATISFACTION


There are many methods for measuring job satisfaction. By far, the most common method for collecting data regarding job satisfaction is the Likert scale (named after Rensis Likert). Other less common methods of for gauging job satisfaction include: Yes/No questions, True/False questions, point systems, checklists, and forced choice answers. This data are sometimes collected using anEnterprise Feedback Management (EFM) system.

Job description index


The Job Descriptive Index (JDI), created by Smith, Kendall, & Hulin (1969), is a specific questionnaire of job satisfaction that has been widely used. It measures ones satisfaction in five facets: pay, promotions and promotion opportunities, coworkers, supervision, and the work itself. The scale is simple, participants answer either yes, no, or cant decide (indicated by ?) in response to whether given statements accurately describe ones job. The Job in General Index is an overall measurement of job satisfaction. It is an improvement to the Job Descriptive Index because the JDI focuses too much on individual facets and not enough on work satisfaction in general. Other job satisfaction questionnaires include: the Minnesota Satisfaction Questionnaire (MSQ), the Job Satisfaction Survey (JSS), and the Faces Scale. The MSQ measures job satisfaction in 20 facets and has a long form with 100 questions (five items from each facet) and a short form with 20 questions (one item from each facet). The JSS is a 36 item questionnaire that measures nine facets of job satisfaction. Finally, the Faces Scale of job satisfaction, one of the first scales used widely, measured overall job satisfaction with just one item which participants respond to by choosing a face.

Advantages of Job Descriptive Index


Extremely easy to use with all types of respondents

Most commonly used measure of job satisfaction

Disadvantages of Job Descriptive Index


Shouldnt sum across factors Is there more to job satisfaction than just the 5 factors.

DETERMINANTS OF JOB SATISFACTION


1) Nature of job: Job satisfaction is related to the appitude of the employee. If the employee is given a work for which he has no aptitude, the job will provide no attraction to him. Hence the question of contribution, creativity or motivation does not arise. It is for the management to design jobs in such a manner that each worker gets the job of his own choice.

2) Nature of supervision: The employee-centred supervisiory style enhances job satisfaction as the leader looks after subordinates carefully, displays friendship, respect and warmth etc; towards them. On the other hand, production-oriented leader may cause low job satisfaction to the employees and may effects the turnover and absenteeism adversely. Of course, it all depends on the situation.

3) Working condition: job satisfaction id related to working condition also. The work will be more attractive if working conditions are congenial to the task a worker proposes to accomplish. Good working condition involve such facilities as adequate light, comfortable temperature, attractive surrounding, etc.

4) Rewards: Economic rewards play a significant role in influencing job satisfaction. Thos is because of two reasons. First, money is an important instrument in fulfilling ones need; and secondly, employees often see pay as a reflection of

managements concern for them. Employees want a wage pay system which is simple fair and in line with their expectations. When pay is seen as fair, based on job demands, indivisuals skill levels, and community pay standards, satisfaction is likely to result. What needs emphasis is that it is not the absolute amount paid that matters, rather it is ones perception of fairness.

5) Opportunities of promotion: Promotional opportunities affects job satisfaction considerably. The desire for promotion is generally strong among higher level employees as it involves change in job content, pay, responsibility, autonomy, status and the like. It is no surprise that the employee takes promotion as the ultimate achievement in his career and when it is realized, he feels extremely satisfied.

6) Nature of work group: It is the work-group that fulfills the need for social interaction of the members. If the worker has good relation with the fellow employees and the supervisor, he will feel satisfied. If the work-group enjoys a higher status his job satisfaction will increase further .

7) Employee morale: If the employee morale in an organization is higher, satisfaction with job is likely to be higher and vice versa. The workers will be loyal to the organization if their morale is higher, the rates of absenteeism and labor turnover will also be low because psychological satisfaction from the job.