Performance

Management and
Performance Appraisal

Lecture 05
Anupama Dilini Dissanayake
MEcon (Col. - in progress), MLRHRM (Col.),
BBA (Hons) (Sheff Hallam), PQHRM (IPM)  
Lecturer
Faculty of Business
SLIIT - Malabe Campus anupama.d@sliit.lk
  Find what performance is and the
levels of performance
 Explain Performance Appraisal

 Identify and describe objectives of

performance appraisal and methods of
Performance Appraisal

Performance Management and Appraisal anupama.d@sliit.lk

  Level of achievement or accomplishment.

 Organizations have to keep improving the performances

 P = ƒ (A * M * E)
 P = Performance

 A = Ability (Skills, Knowledge & Attitudes)

 M = Motivation

 E = Environment (working)

Performance Management and Appraisal anupama.d@sliit.lk

 Levels of Performance Performance
Management Management Process

Organizational 1. Performance
Performance Planning

2. Performance
Departmental
Execution
Performance

3. Performance
Individual Appraisal
Performance

4. Performance
Review
Performance Management and Appraisal anupama.d@my.sliit.lk
  Having talented people is not enough. Successful organizations are
adept at engaging their workforce to achieve goals.

 Performance management is necessary to measure the performance

of the employees and the organization to check the progress towards
the desired goals and aims.

 According to Flippo,, "performance appraisal is the systematic,

periodic and an impartial rating of an employee’s excellence in the
matters pertaining to his present job and his potential for a better
job."

Performance Management and Appraisal anupama.d@my.sliit.lk

 A systematic way of reviewing and assessing the
performance of an employee during a given period of
time and planning for his future.

Performance appraisal programs are most helpful

tools an organization can use to maintain and enhance
productivity and facilitate progress towards strategic
goals.

Performance Management and Appraisal anupama.d@my.sliit.lk

 A systematic process for improving organizational
performance by developing the performance of
individuals and teams.

It is a means of getting better results by understanding

and managing performance within an agreed
framework of planned goals, standards and
competency requirements.
Performance Management and Appraisal anupama.d@my.sliit.lk
 Help employees and supervisors do their jobs better

 Improve communications and trust

 Provide people with clear direction

 Identify performance problems early

 Reinforce good performance

 Make process fairer; people are more likely to accept

Performance Management and Appraisal anupama.d@my.sliit.lk

 Performance Appraisal
anupama.d@my.sliit.lk
  Establish objectives of PE

 Formulate Policies

 Establish criteria and standards of PE

 Select method(s) of PE

 Design evaluation form and procedure

 Train evaluators

 Appraise & discuss PE results

 Make decisions and store

 Review and renewal

Performance Management and Appraisal anupama.d@my.sliit.lk
 Objectives are integral part of any PE program
Objectives are favorable targets to be achieved in the
future.

Some objectives are;

 To ascertain the current level of job performance of each employee

 To ascertain strengths and weaknesses

 To ascertain potential performance and development needs

 To provide a fair and objective rationale in order to reward employees

Performance Management and Appraisal anupama.d@my.sliit.lk

 A well defined policies have to be decided.
 Whose performance should be evaluated?
 When should PE be done?
 How often should PE be done?
 Who should do PE?

Performance Management and Appraisal anupama.d@my.sliit.lk

 Specific criteria and standards to be used in judging
employee performance have to be identified and
selected and established.

Criteria – factors that are used to evaluate job

performance of employees for a certain period of time.
(Objective criteria, subjective criteria).

Standards – Rating scales used for evaluations.

Performance Management and Appraisal anupama.d@my.sliit.lk

 A method of evaluating employee job performance has
to be selected

When selecting a method of PE nature of job, purpose

of evaluation and cost involved need to be considered.

Performance Management and Appraisal anupama.d@my.sliit.lk

  Behavior Appraisals
 Assesses how workers perform their jobs—the actual
actions and behaviors that exhibit on the job.
 Focuses on what a worker does right and wrong and
provides good feedback for employees to change their
behaviors
 Results appraisals
 Managers appraise performance by the results or the actual
outcomes of work behaviors

Performance Management and Appraisal anupama.d@my.sliit.lk

  Trait Appraisals
 Assessing subordinates on personal characteristics that
are relevant to job performance.

Performance Management and Appraisal anupama.d@my.sliit.lk

   Advantages Disadvantages
Trait 1. Inexpensive to develop 1. Have high potential for rating errors
Methods 2. Use meaningful dimensions 2. Are not useful for employee counselling
3. Are easy to use 3. Are not useful allocating rewards
4. Are not useful for promoting decisions

Behavioral 1. Use specific performance dimensions 1. Can be time consuming to develop/ use
Methods 2. Are acceptable to employees and 2. Can be costly to develop
superiors 3. Have some potential for rating error
3. Are useful for providing feedback
4. Are fair for rewards and promotion
decisions
Results 1. Have less subjectivity bias 1. Are time consuming to develop/ use
Methods 2. Are acceptable to employees and 2. May encourage a short-term
superiors perspective
3. Link individual performance to 3. May use contaminated criteria
organizational performance 4. May use deficient criteria
4. Encourage mutual goal setting
5. Are good for reward and promotion
decisions

Performance Management and Appraisal anupama.d@my.sliit.lk

 Trait Methods Behavioural Result Methods
Methods
Graphical Rating Critical Incident Productivity
Scale Method Measures

Mixed Standard Behavioral Checklist Management by

Scales Method Objectives

Forced Choice Behaviorally Balance Scorecard

Method Anchored Rating
Scale
Essay Method Behavior
Observation Scale

Performance Management and Appraisal anupama.d@my.sliit.lk

 SUPERIOR
CUSTOMERS

TEAM
PEERS SELF

SUBORDINATES

Performance Management and Appraisal anupama.d@my.sliit.lk

 PE form is a vital tool for PE.
Two approaches are available
 General approach
A common form and procedure for all employees

 Specific approach
Design a separate form and a procedure for different types
of employees

Performance Management and Appraisal anupama.d@my.sliit.lk

 Training of evaluators refers to systematic endeavor to improve efficiency
and effectiveness of evaluators in PE by increasing their competencies
regarding evaluation of human performance on the job.

Evaluator Training Methods

Lectures
Case study methods
Role playing
Programmed instructions
Special courses of PE

Performance Management and Appraisal anupama.d@my.sliit.lk

 Performance Errors
Central tendency
Leniency or strictness error
Recency error
Contrast error
Similar to me error

Performance Management and Appraisal anupama.d@my.sliit.lk

  Once the evaluation of performance of an employee is done
results of the evaluation should be discussed with the
employee by the evaluators

 This is generally done through a PE interview/ Performance

Review Interview

Performance Management and Appraisal anupama.d@my.sliit.lk

Questions

anupama.d@my.sliit.lk
 Find what performance is and the
levels of performance
 Explain Performance Appraisal

 Identify and describe objectives of

performance appraisal and methods of
25

Performance Appraisal anupama.d@my.sliit.lk

Vidurangi Wijesundera receiving SLIIT Gold Medal for Academic Excellence for SLIIT
BBA Special Honours Degree Examination