PERFORMANCE

APPRAISAL
MANAGEMENT
Mesbah Rezwe
Every year most employees experience an evaluation
of their past performance, It may be a five minute
informal discussion, between the employees & their
supervisors, or an elaborate several weeks process.
Irrespective of the formality,& the format, the
employees see them as having some effect on their
work lives.

The Performance Evaluation process thus

creates an emotionally charged event which is
critical to perform.

PERFORMANCE APPRAISAL
MANAGEMENT
- What is performance appraisal ?
- Why performance evaluation ?
- Who should benefit from the evaluation ?
- What type of evaluation should be used ?

PERFORMANCE APPRAISAL
MANAGEMENT
What is performance appraisal ?

Performance Appraisal is the process by which

organizations evaluate individual Job performance.

Who benefits ?
When it is done correctly,

-The employees, their supervisors ,

-The HR department &ultimately ,
-The organization benefits by the individual efforts
contributed towards the strategic focus of the organization

PERFORMANCE APPRAISAL
MANAGEMENT
Why do performance appraisals ?

HR departments also use the information gathered

through performance appraisals to evaluate the success
of :-
-Recruitment,
-Selection,
-Orientation,
-Placement, and
-Training .

Formal appraisals are needed to facilitate, help managers

for formalizing:-
-Placement,
-Pay and other
-HR strategic decisions
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MANAGEMENT
Performance appraisal Focus

The evaluation process besides other attributes also

includes the following:

-Employees ability to perform a task /job effectively

timely & accurate manner,

-Employees interactions with other employees

& customers

-Employees inputs about their boss’s, supervisors

effectiveness at work.
-Employees body language
Challenges/Concerns

No performance evaluation or appraisal is perfect,

-Factors which influence the objectivity of the exercise,

positively
or otherwise

-The dynamic work environment,

-Poor appraisal training,
-Obsolete measures.

-Proper & complete evaluation does not happen,

as such the performance appraisals come under scrutiny
and criticism/attack.
The Management of Performance

The Performance management systems involve a number of

activities, they are more than simply reviewing what an
employee has done over a prescribed period of time

These systems must fulfill several purposes

Scope
Performance appraisals

Regardless of the potential problems that may exist,

it is expected that performance management systems
to survive in some format or the other.
Accordingly understanding the foundations of
performance management systems, the ways
Appraisals may be constructed, as well as the potential
problems one may encounter, is & will remain critically
important.
Performance appraisal is not a simple exercise ,the

following key activities of the job influence, and are critically

relevant in the process of employee evaluations;

-The dynamic environment,

Due to too much ‘job rotation’ of an employee, the task of current

evaluation & the visualized prospective performance a difficult
exercise/choice

-The employees ability to perform tasks in a timely &

effective manner

-Supervisors employees have an input in their boss’s

effectiveness ?
-How well a manager serves as a mentor
-The employees body language in terms of interaction with
others employees, customers becomes critically relevant
The Appraisal Process
The appraisal process begins with the following;

Establishment of

Performance standards ;
The standards should be established in accordance with the
organizations strategic goals.

The performance standards should be ;

Clear : They should be unambiguous & understandable
Objective : Findings should transparently lead to reward &
award

Measureable. They should be significantly/publicly

measurable
The Process
It is therefore incumbent to :-

-Establish performance standards with employees

-Mutually set measurable goals
-Measure actual performance
-Compare actual performance with standards
-Discuss the appraisals with the employee
-Initiate corrective action if necessary

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MANAGEMENT
The expectations in terms of work performance
must be clear enough so that they are
communicated to the employees,
The employees and the management mutually
agree to the specific job performance measures
and appraise their performance as against
these established /agreed standards
Performance Management System

The Purpose

Previously performance evaluations were designed primarily

to tell the employees how they had performed over a period
of time, besides the ‘Pay raise’ they would be getting.
Today the performance appraisal system should also address
the :

-Development concern
-Documentation concerns.
-Documentation:
Performance appraisals outcomes must be conveyed/shared
with
employees, to apprise how they have performed on the
established goals.

-The documentation also serves and is used as a record of the

performance appraisal process and its outcome

-Development:
The areas where an employee has a deficiency or weakness,
or an area which can be better if efforts are
expended to enhance performance, should be identified and
addressed
 Documentation
Sincerity & transparency

Documentation ;

This facilitates the objective achievements and

hence is integral to the process & beneficial for HR
personal/anyone who is involved in the human
resource management process at the contemporary
organizations
Sincerity in documentation
- Broadening perimeters of the appraisal process
Performance appraisal outcomes

Critical aspects,

The appraisers

-Poor ‘appraisal training’

The supervisors, when required to perform as
evaluators are not properly trained and not well
versed in the Appraisal procedure and
methodology hence the outcomes may not be truly
reflective of the performance

-Obsolete measures,
This can hinder the outcome of evaluation.
The elements in Performance Management Systems

The three constituencies in the process

-The employees
-The appraisers
-The Organization

Coordinating the needs of each may cause problems

Two primary categories need to be addressed

- Focus on the individual

- Focus on the process
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MANAGEMENT
Focus on the Individual

Appraising individuals is probably one of the more

difficult aspects of a supervisors job, reason
people see ‘eye to eye 'on the evaluation,
giving rise to emotions on either side, and if these
Emotions are not dealt with properly,
they can lead to bigger conflicts

When emotions do not run high, employee satisfaction

and trust in the process is enhanced

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MANAGEMENT
Focus on the Process

HRM policies often dictate performance outcomes

Wherever performance evaluations are conducted
there is a particular structure that must be followed
The structure should facilitate the documentation
process that should allow some sort of quantifiable
evaluation
Company policies and procedures may pose barriers
to a properly functional appraisal process

PERFORMANCE APPRAISAL &

MANAGEMENT
 Focus on the process …
Poorly trained appraisers ‘
The supervisors are poorly trained in how to evaluate an
employees performance, because of this lack of training they
may make

- Errors in judgment, or

- Permit biases to enter into the process.

The performance appraisal process may be so developed
to achieve maximum benefit from it,
this can be translated through employee satisfaction with the
process
 Focus on the process…

It is incumbent on the HRM that:

Employee satisfaction is achieved through :

-Creating an understanding of the evaluation criteria, among
the employee and
-Permitting the employee/ appraisee’s participation
in the performance evaluation process followed by :

-Identification of the development needs, grey area of

Performance followed by the documentation and the
initiation of the redressal process through desirable
Training programs be initiated when where necessary.
The Essence of Performance management-

The HRM must make the efforts to ensure that the

Evaluation systems used are conducive to and duly
support the legal needs of and the organizational
objectives

The Vital criteria that human resource managers must

bring to the performance appraisal process is;

-Sincerity
-Honesty

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MANAGEMENT
The System

The Organizations/Appraisers must have a performance

system
that is appropriate for their needs;

A system that facilitates;

-Giving feedback and

-Development information
to their employees & employers

Organizations that fail to accurately manage employee

performance often find themselves facing difficult times
in meeting organizational goals
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 Appraisal Methods
The Human Resource Managers can establish performance
standards & device instruments to measure & appraise
employees performance

There are three preferred approaches /standards

Employee’s Performance can be Appraised against;

-Absolute standards
-Relative standards
-By Objectives

No one approach is sufficient & rated as always best

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Absolute standards;
Measuring an Employee’s performance against some
established standard independent of any other employee.
Following methods are applied in this category;

-Essay appraisal:
The appraiser writes a narrative about the employee
-Critical incident appraisal:
Focus on the key behaviors that make the difference between
effective & ineffective performance
-Checklist appraisal:
using ‘behavioral descriptions, the appraiser checks off those
attributes that apply

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MANAGEMENT
 Appraisal Methods

-Adjective Rating scales:

This system lists a number of ‘traits’ like ;

-Quantity & Quality of work,

-Job knowhow/knowledge,
-Dependability, attendance, cooperation
-Loyalty ,honesty
-Attitudes & initiative

-Forced choice appraisals:

A method wherein the appraiser chooses between two specific

statements about an employee’s work behavior

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 Appraisal Methods

B.A.R.S:
Behaviorally Anchored Rating Scales.

It’s a method ,a technique that generates incidents

and develops behavioral dimensions,
The method appraises employees behaviors rather
than traits

PERFORMANCE APPRAISAL &

MANAGEMENT
 Relative standards methods
-Evaluating an employee’s performance by comparing the
employee with other employees.
Individuals are compared against other individuals
These maynot be & are not absolute measuring devices.

Categories in these methods:

-Group Order ranking;

Employees are placed categorised based on ideal/ desired
Performance in a particular Class like;
-Among Top 10%’
-Among top 20%

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Relative standards methods

-Individual ranking;
Ranking performance from highest to lowest

-Paired comparisons;
Counting the number of times an individual is
preferred,when compared with all other employees

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MANAGEMENT
Management By Objectives; MBO

A performance appraisal method that includes mutual objective

setting
and evaluation based on the attainment of the specific
objectives
A process that converts organizational objectives into individual
Objectives through the following four steps;

-Goal setting; Organizational objectives are guidelines

-Action planning; Determine the means to achieve the end
-Self control; Systemic monitoring & measuring outcomes
-Periodic reviews;

Advantage lies in the result oriented emphasis

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360 Degree Appraisal

An appraisal device that seeks performance feedback

from different sources as

-Oneself,
-Bosses,
-Peers,
-Team members,
-Customers and
-Suppliers.

Quite popular in contemporary organizations

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MANAGEMENT
360 degrees Appraisal….

Definition
‘Performance appraisal process in which
-The supervisors
-The peers
-The employees,
-The customers and the like evaluate the individual’

Delayering has resulted in supervisors having greater work

responsibility and more employees reporting to them directly
Hence it is difficult for supervisors to have extensive job knowledge
of each of their employees
The growth of project teams and employee involvement in
contemporary companies places the responsibility of evaluation
Where people are better able to make an accurate assessment all the
more vital .

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MANAGEMENT
Advantages
Research studies on the effectiveness of the device are
reporting positive results, namely;

-Positive benefits for development concerns

-Accurate feedback
-Employee empowerment
-Reducing subjective factors
-Development of leadership in an organization

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MANAGEMENT
Appraisal Objective

The appraisal should create an accurate picture

of an individuals typical job performance, not to
uncover poor performance,
-To achieve this goal the system should be job
related, if otherwise
- It would be invalid and unreliable and thus in
violation of equal opportunity laws

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MANAGEMENT
Critical features

-Practicality: Understood by both, appraisers and

those being appraised

-Standardization: Well thought out performance

standards, a written record of which
should exist,& be advised to the
employees, to serve as or benchmarks
and measures

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MANAGEMENT
Performance Appraisal challenges

The P.A .exercise encounters & contributes towards various challenges

The main challenges faced by the human resource management
professional are:

-legal Constraints
-Rater Biases
-Appraisal acceptance

Thus the performance appraisal system design and application implies

that the evaluator is free from ;
-Personal biases,
-Prejudices
-Idiosyncrasies,

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Legal constraints

The evaluation format used should be reliable and

valid,& free of illegal discrimination, & not violate
‘equal employment laws’ or other laws.

Court case/indulgence may result in

-Wrongful discharge
-Improper termination, firings
-Decisions involving
-Lay offs
-Demotions
-Failure to promote

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MANAGEMENT
Rater Biases
Bias is the inaccurate distortion of measurement.
Training in performance appraisals can reduce ‘bias’

Common ‘Rater Biases 'are;

-The halo effect

-Leniency & strictness bias
-Personal prejudice
-Cross cultural biases
-The similarity error/ recency effect
-The error of central tendency

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MANAGEMENT
The ‘Halo 'effect/error

The tendency to let our assessment of an individual on

one trait influence our evaluation of that person on other
specific traits

Example;
’If an employee tends to conscientious & dependable,
the evaluator may become biased towards that individual
to the extent that he may rate him/her positively on many
desirable attributes

PERFORMANCE APPRAISAL &

MANAGEMENT
 Leniency & strictness bias

Means by which performance appraisal can be distorted

by the ‘evaluating employees against ones own value
system.
-Positive leniency error;
marking high ,relative to the actual performance
-Negative leniency error:
Marking low relative to the actual performance.

PERFORMANCE APPRAISAL &

MANAGEMENT
Personal prejudice

Evaluators dislike for ;

-A Group,
-A class or
-Gender
May distort the ratings those people receive

‘Patterns in appraisals ’
A close attention to patterns can lead to identification of and that suggest
prejudice

Prejudice prevents effective evaluations and may violate

anti discriminatory laws

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MANAGEMENT
Cross cultural biases
Every rater/evaluator holds expectations about human behavior
that are based on his/her own culture.
When people are expected to evaluate others from different
cultures, they may apply their cultural expectations to
someone who has a different set of beliefs or behaviors,

Example:
-If a young worker/evaluator is asked to rate an older subordinate,
the cultural value of “respect & esteem” may bias the rating
-In a Muslim culture environment, women are expected to play a
subservient role, assertive women as such may receive biased
ratings

PERFORMANCE APPRAISAL &

MANAGEMENT
The error of central tendency

To avoid rating employees as ‘effective’ or ineffective’ ,

’very poor’ or ‘excellent', the evaluators ratings are distorted
to make each employee appear as ‘average‘.

The ratings/markings thus appear near the center of the rating

sheet.
The term of ‘error of central tendency’ is applied to this
bias

PERFORMANCE APPRAISAL &

MANAGEMENT
The similarity error/& Recency effect
Evaluating employees based on the way an evaluator perceives
him/her self, they commit a similarity error
e.g.: An evaluator who perceives him/herself as aggressive may
evaluate others by looking for aggressiveness,. those who
demonstrate it ,benefit, while those lacking are penalized

-Recency effect
Ratings /evaluations are strongly effected by the employees
most recent actions-either good or bad –are more likely to be
remembered & influenced

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Performance Management
The Application

-Training & Development

-Compensation & benefits

-Teams

PERFORMANCE APPRAISAL &

MANAGEMENT