7

Appraising and
Managing Performance

© 2004 by Prentice Hall 7-1

Terrie Nolinske, Ph.D.
 Challenges to HR
•
• What are advantages / disadvantages of
performance rating systems?

• What is the impact of emotion, rating error

and bias in performance appraisals?

• How can performance appraisals manage

and develop employee performance?

© 2004 by Prentice Hall 7-2

Terrie Nolinske, Ph.D.
 Performance Appraisals
The identification,
measurement and
management of
human performance
in organizations.

© 2004 by Prentice Hall 7-3

Terrie Nolinske, Ph.D.
 Dimension
An aspect of performance
that determines effective
job performance.

© 2004 by Prentice Hall 7-4

Terrie Nolinske, Ph.D.
 Performance Appraisal
Benefits to Employer
• Individual differences make a difference to
company performance.
• Documentation of performance may be needed
for legal defense.
• Appraisal provides basis for bonus or merit
system.
• Appraisal dimensions and standards help
implement strategic goals and clarify
performance expectations.
• Appraisal criteria can include teamwork.

© 2004 by Prentice Hall 7-5

Terrie Nolinske, Ph.D.
 Performance Appraisal
Benefits to Employee
• Improvement in performance requires
assessment.

• Differences in worker performance should

have an effect on merit and work itself.

• Assessment and recognition of

performance levels can motivate workers
to improve their performance.

© 2004 by Prentice Hall 7-6

Terrie Nolinske, Ph.D.
 Measurement Tools
Judgment required
Relative or absolute

Focus of measure
Trait, behavior, or outcome

© 2004 by Prentice Hall 7-7

Terrie Nolinske, Ph.D.
 Relative Judgment
Compare or rank employee's performance
to performance of other employees doing the
same job.

Absolute Judgment
Make judgments about employee’s
performance based solely on performance
standards.

© 2004 by Prentice Hall 7-8

Terrie Nolinske, Ph.D.
 Ranked Performance of Teams
Actual Ranked Ranked Ranked
Work Work Work
10 High Jill (1) Frank (1)
9 Julie (2)
8 Zehra (2) Unama (3)
7 Marcos (1) John (3)
6 Tamiko (2)
5
4 Jocyln (4)
3 Joyce (3) Bob (4)
2 Ed (4) Bill (5) Ken (5)
1 Low Richard (5)
© 2004 by Prentice Hall 7-9
Terrie Nolinske, Ph.D.
 Trait Appraisal
Make judgments about worker
characteristics that tend to be
consistent and enduring.

© 2004 by Prentice Hall 7 - 10

Terrie Nolinske, Ph.D.
 Behavioral Appraisal
An appraisal tool that asks managers to assess a worker’s behaviors.

e.g. Work habits - tardiness, obeys policies,

timely work completion, does not
interfere in work of others

o Exceeds exp o Meets exp o Does not meet exp

© 2004 by Prentice Hall 7 - 11

Terrie Nolinske, Ph.D.
 Outcome Appraisal

An appraisal tool that asks managers to

assess the results achieved by workers.

Exc Good Poor

e.g., timely _X_ ___ ___
thorough ___ _X_ ___
professional _X_ ___ ___
formatted ___ ___ _X_

© 2004 by Prentice Hall 7 - 12

Terrie Nolinske, Ph.D.
 Trait Scales
Rate each worker using the scales below.

Decisiveness:
1 2 3 4 5 6 7
Very low Moderate Very high

Energy:
1 2 3 4 5 6 7
Very low Moderate Very high

© 2004 by Prentice Hall 7 - 13

Terrie Nolinske, Ph.D.
 Challenges to Effective
Performance Measurement

• Rater errors and bias

• Influence of liking
• Organizational politics
• Legal issues
• Whether to focus on
individual or group

© 2004 by Prentice Hall 7 - 14

Terrie Nolinske, Ph.D.
 Legal Issues
Analysis of 295 court cases involving
performance appraisal found judges’ decisions
were favorably influenced by the following:
• Use of job analysis
• Written instructions
• Allowing employees to review appraisal
• Agreement among multiple raters (if
more than one was used)
• Evidence of rater training
© 2004 by Prentice Hall 7 - 15
Terrie Nolinske, Ph.D.
Communication in Performance
Appraisals uses…
Direct eye contact
Active listening
Open - ended questions
Paraphrasing to clarify
Empathy and sensitivity

© 2004 by Prentice Hall 7 - 16

Terrie Nolinske, Ph.D.
 What causes problems at work?
• Poor coordination of work activities
• Inadequate information or instructions
• Low-quality materials
• Lack of necessary resources
• Poor supervision
• Poor interpersonal communication
• Inadequate training
• Insufficient time to produce
• Poor work environment (cold, noisy)

© 2004 by Prentice Hall 7 - 17

Terrie Nolinske, Ph.D.
 Identify and Correct
Ability Problems
• Has the worker ever been able to perform
adequately?

• Can others perform the job adequately,

but not this worker?

Train Transfer
Redesign job Terminate

© 2004 by Prentice Hall 7 - 18

Terrie Nolinske, Ph.D.
 Identify and Correct
Effort Problems

• Is the worker’s performance level

declining?

• Is performance lower on all tasks?

•Clarify linkage between performance and

rewards
•Recognize and reward good performance

© 2004 by Prentice Hall 7 - 19

Terrie Nolinske, Ph.D.
 Identify and Correct
Situational Problems
Do performance problems exist in all workers,
even those with proper supplies / equipment?
•Streamline work process
•Clarify needs to suppliers
•Change suppliers
•Eliminate conflicting signals or
demands
•Provide adequate tools
© 2004 by Prentice Hall 7 - 20
Terrie Nolinske, Ph.D.
 The
combination
360 degree of peer,
feedback subordinate,
and
self-review

© 2004 by Prentice Hall 7 - 21

Terrie Nolinske, Ph.D.
 360 degree Process
• Sanctioned from the top
• Involve employees / managers in
developing appraisal criteria / process
• Train employees how to give feedback
• Inform employees of the process
• Pilot test in part of organization
• Reinforce goals of 360° appraisal
• Revise process when necessary

© 2004 by Prentice Hall 7 - 22

Terrie Nolinske, Ph.D.