performance appraisal
TRANSCRIPT
Performance Appraisal
Objectives Of The Session 13
• Definition of performance appraisal.
• Explanation the performance appraisal
system.
• Discussing the steps of evaluating staff
performance.
• Realizing the uses of staff performance
appraisal findings.
Steps in Evaluating Staff Performance
1. Establish performance standards for each position and the
criteria for evaluation
2. Establish performance evaluation policies
3. Have raters gather data on employee performance
4. Have raters (and employees in some systems) evaluate
employees’ performance Management by objectives
5. Discuss the evaluation with the employee
1. Establish performance standards for each position and the criteria for evaluation
SMART Method:
S-specific
M-measurable
A-agreed
R-realistic
T-timed
2. Establish performance evaluation policies on:
•When to rate?
_on / near the same date
•How often to rate?
_one evaluation in a year
_quarterly evaluations
•Who should rate?
Who Should Rate?
• a committee of several
superiors,
• peers (co-workers),
• employee’s
subordinates,
• Self-evaluation,
• someone outside the
immediate work
situation (seldom
used),
• Combination
3. Have raters gather data on employee performance
The raters collect information by:
• Observation
• analysis of data and records
• discussion with the employee
The data they gather are influenced by:
• criteria used for evaluation
• technique used for evaluation
Evaluation Techniques
• Individual Evaluation
Methods
• Multiple-Person Evaluation
Methods
Individual Evaluation Methods
Under the individual evaluation
methods of merit rating,
employees are evaluated one at a
time without comparing them with
other employees in the
organization.
Ind
ivid
ual
E
val
uat
ion
Met
hods
Graphic Rating Scales
Forced Choice Method
Essay Evaluation
Critical Incidence Method
Checklists
BARS
BOS
Graphic Rating-Scale Method
• Oldest and still most commonly used
method
• printed form
• variety of traits/a set of traits _
quantity and quality of work
-numeric
-alphabetic
A model of a graphic rating scale is given below:
• Table: Typical Graphic Rating Scale
• Employee Name...................
• Job title .................
• Department .........................
• Rate ...............
• Data ..................................
Quantity of work: Volume of work
under normal working conditions
Unsatisfactory
Fair Satisfactory Good Outstanding
Quality of work: Neatness, thoroughness
and accuracy of work Knowledge of job
A clear understanding of the factors
connected with the job
Attitude: Exhibits enthusiasm and
cooperativeness on the job
Dependability: Conscientious, thorough,
reliable, accurate, with respect to
attendance, reliefs, lunch breaks, etc.
Cooperation: Willingness and ability to
work with others to produce desired
goals.
Positive point in favor of the rating scale
•easy to understand
•easy to use
•permits a statistical tabulation of
scores of employees
Disadvantage of Graphic Rating Scale
•Arbitrary
•rating may be subjective
Forced-Choice Method
• to substitute graphic rating
scales
• a set of descriptive statements
Forced-Choice Method
• The primary purpose is to correct the
tendency of a rater to give consistently high
or low ratings to all the employees.
• several sets of pair phrases(two positive and
two negative)
Forced-Choice Method
• 1. Least Most
• A Does not anticipate difficulties A
• B Grasps explanations easily and quickly B
• C Does not waste time C
• D Very easy to talk to D
• 2. Least Most
• A Can be a leader A
• B Wastes time on unproductive things B
• C At all times, cool and calm C
• D Smart worker D
Essay Evaluation
• A trait approach to performance
appraisal that requires the rater to
describe the strong and weak aspects
of the employee behavior.
• normally used with a combination of
other methods(Graphic Rating
Scale),because…
Essay Evaluation
While preparing the essay on the employee,
the rater considers the following factors:
• Job knowledge and potential of the employee;
• Employee's understanding of the company's
programs, policies, objectives, etc.
• The employee's relations with co-workers and
superiors
• The employee's general planning, organizing and
controlling ability
• The attitudes and perceptions of the employee, in
general.
• a good deal of information
about employee
• reveals more about the evaluator
• highly subjective
• biased essay
• Sycophant employees
• poor writing essays
• time to prepare the essay
Critical Incident Technique
• Critical Incident: Unusual
event that denotes superior or
inferior employee performance
in some part of the job.
• A list statement: very effective
and ineffective performancs of
an employee
• the end of the rating period
Critical Incident Technique
Example of a good critical incident of a sales
assistant is the following:
July 20 – The sales clerk patiently attended to
the customers complaint. He is polite, prompt,
enthusiastic in solving the customers' problem.
Critical Incident Technique
On the other hand the bad critical incident
may appear as under:
• July 20 – The sales assistant stayed 45
minutes over on his break during the busiest
part of the day. He failed to answer the store
manager's call thrice. He is lazy, negligent,
stubborn and uninterested in work.
Advantages of Critical Incident Technique
• Less subjective/objective basis for
conducting a thorough discussion of an
employee's performance.
• avoids recency bias(most recent incidents
get too much emphasis)
Limitations of Critical Incident Technique
• Negative incidents may be more noticeable
than positive incidents
• It results in very close supervision which
may not be liked by the employee
• The recording of incidents may be forgotten.
• The supervisors have a tendency to unload a
series of complaints about incidents during
an annual performance review session.
• More time
Checklists and Weighted Checklists
• Simple
• a set of objectives or descriptive statements
• Listed traits( check, blank)
• The weighted list :
-more recent variation
-(Excellent to poor)
Some of the sample questions in the checklist:
Is the employee really interested in the task assigned?
Yes/No
Is he respected by his colleagues (co-workers)?
Yes/No
Does he give respect to his superiors?
Yes/No
Does he follow instructions properly?
Yes/No
Does he make mistakes frequently?
Yes/No
• The rater may be biased in distinguishing the
positive and negative questions.
• expensive and time consuming
• In spite of, the checklist method is most
frequently used
Behaviorally Anchored Rating Scale (BARS)
•Smith and Kendell
•Also known as Behavioral Expectations
Scale
•Combination of the rating scale and
critical incident techniques
Behaviorally Anchored Rating Scale (BARS)
• The BARS approach relies on the use of
critical incidents
• A BARS rating form usually contains 6 to 10
specifically defined performance
dimensions(both positive and negative).
• preferred
Example of (BARS) Performance Points Behavior
Extremely good 7 Can expect trainee to make valuable suggestions for increased
sales and to have positive relationships with customers all over
the country.
Good 6 Can expect to initiate creative ideas for improved sales.
Above average 5 Can expect to keep in touch with the customers throughout the
year.
Average 4 Can manage, with difficulty, to deliver the goods in time.
Below average 3 Can expect to unload the trucks when asked by the supervisor.
Poor 2 Can expect to inform only a part of the customers.
Extremely poor 1 Can expect to take extended coffee breaks and roam around
purposelessly.
Behavioral Observation Scales(BOS)
• Latham and associates
• uses the critical incident technique to
identify a series of behaviors that cover the
domain of the job.
Multiple Person Evaluation Techniques
• Multiple person evaluation techniques are
those methods when the performance of one
employee is directly and intentionally
compared with the performance of other
employee.
Mult
iple
Per
son E
val
uat
ion
Tec
hniq
ues
Ranking
Paired Comparison
Forced distribution
R a n k i n g
• the case when the superior is asked to rank
the subordinates based on some overall
criterion.
Paired Comparison
• several subordinates to be ranked
• Each employee is paired with every person
to be compared with
• better performing subordinate
• number of times that a person is chosen as
the better employee is tallied
• results are indexed based on this number.
Forced Distribution
• similar to grading on a curve
• fixed distribution of categories, such as
10% in low,
20% on low average,
40% in average,
20% in high average and
10% in high
Which evaluation technique
to use?
4.Have raters (and employees in some
systems) evaluate employees’ performance
Management by objectives
Management By Objective (MBO)
• Philosophy of management that rates
performance on the basis of employee
achievement of goals set by mutual
agreement of employee and manager.
(MBO)
• is more than just an evaluation program and
process
• a method by which managers and
subordinates plan, organize, control,
communicate and debate.
• a modern method
(MBO)
• The concept of MBO is actually the
outcome of the pioneering works of
Drucker, McGregor and Odiorne in
management science.
• Integrates performance and goal
setting
• Management by objectives can be
described as “a process whereby the
superior and subordinate managers of an
organization jointly identify its common
goals, define each individuals' major areas
of responsibility in terms of results expected
of him and use these measures as guides for
operating the unit and assessing the
contributions of each of its members”.
Advantages of MBO
• Employees Can Measure
Performance
• Quantifiable Goals
• Joint Effort
• Employee Satisfaction in
Participation
Disadvantages of MBO
• Easy to Set Unrealistic Goals
• Hard to Get Full Commitment to
Process
• Difficult to Define Some Goals
Potential Problems when Conducting Performance
Evaluations
1. Opposition to evaluation
2. System design and operating problems
3. Rater problems/Errors
4. Employee problems with performance
evaluations
Types of Rater Problems/Errors
1. Problems with the standards of evaluation
2. The Halo effect
3. Leniency or harshness/Strictness error
4. Central tendency error
5. Recency of events error
6. Contrast effects
7. Personal bias error
1.Problems with the standards of
evaluations :
• due to the perceptual differences in the
meaning of the words
• Statements with good qualifications
2.The Halo effect :
• based on an overall, general impression of
the ratee
3.Leniency or Harshness/Strictness Error:
• Performance-rating error in which the
appraiser tends to give employees either
unusually high or unusually low ratings.
• lenient raters
• harsh raters
4.Error of Central Tendency:
• Performance-rating error in which all
employees are rated about average.
• Reluctant to Give High/Low
• average ratings
5. Recency Error:
• Performance-rating error in which the
appraisal is based largely on the employee’s
most recent behavior rather than on behavior
throughout the appraisal period.
• Past behavior, Last Action
• Encourage Frequent Evaluation
6. Contrast effects :
• individual evaluation techniques
• in some cases only theory.
• For example,
average colleague , outstanding employee
7. Personal bias error :
• The tendency to rate the preferred employees
higher and those not preferred lower
Rating Errors Example
Halo Job Rating Scale
EXCELLENT
on all factors
Leniency Job Rating Scale
Employee A
EXCELLENT
Job Rating Scale
Employee B
EXCELLENT
Job Rating Scale
Employee C
SUPERIOR
Job Rating Scale
Employee D
EXCELLENT
Central
Tendency
Job Rating Scale
Employee A
AVERAGE
Job Rating Scale
Employee B
AVERAGE
Job Rating Scale
Employee C
AVERAGE
Job Rating Scale
Employee D
AVERAGE
Recency
Bias
Job rating scale behavior during the
last month has been POOR.
Rater Errors
Can be eliminated, or at least reduced:
•trainings for raters in order to develop their
ability to observe, recall and report
subordinate behavior lead to improvement of
employee evaluations
•using of new methods, such as BARS
Employee problems with performance evaluations
The most common problem:
• unfair evaluations
In order to avoid this perception:
• how difficult is the evaluation
• self evaluations
5. Discuss the evaluation with the employee
• evaluation interview (evaluation , objs )
• the employee development and salary action
discussions
Scheduling the Performance Appraisal
1. Schedule the interview and notify the
employee 10 to 14 days in advance.
2. Ask the employee to prepare for the
session by reviewing his or her
performance, job objectives, and
development goals.
3. Clearly state that this will be the formal
annual performance appraisal.
Appraisal Interviews
Three generally used approaches to these
interview situations:
– Tell-and-sell method
– Tell-and-listen method
– Problem-solving method (generally preferable)
depends mainly on the experience level of the employee.
The performance evaluation discussions
should include: • Review of overall progress
• Discussions of problems that were
encountered
• Agreement about potential performance
improvement possibilities
• Discussion how current performance is in
line with long term carrier goals
• Specific action plans for the coming year
Recommended Actions
At the end of the appraisal, the
evaluator/supervisor should recommend
any of the following actions: • Annual Increment
• No Increment
• Special Increment
• Promotion
• Removal
• Arrangement of training for employee’s further
improvement of the skill
Annual Increment:
• satisfactory performance
• one-step salary increment annually
No Increment:
• Unsatisfactory performance and for which
employee was warned and notified in written form
• manager should state the reasons for
recommending “no increment” or “withholding
annual increment”.
Special Increment:
• exceptional case
• outstanding performance ,if:
• criteria should be met
• evaluator/supervisor has
recommended so through the
performance appraisal
Criteria for Special performance increment
are the following:
• employee has demonstrated outstanding
performance and appraisal also reflects so;
• employee possesses strong personal traits for
successful performance;
• Rationales for special increment are given by the
supervisor(s)
Promotion:
All promotions shall be based on the following
criteria:
– Outstanding rating in all area of assessment,
contributed to achieve organizational objectives
and the supervisor/evaluator's justification.
– Employee possesses and high potential and
capabilities to undertake higher responsibilities;
– Employee possesses qualification, knowledge,
skills and attitude required for proposed
position;
– Vacancy is available.
Removal:
• sufficient ground
• previous reference
• Justification
• the organization must follow the procedures
Arrangement of training for employee’s further
improvement of the skill:
• Trainings
Reward/Punishment on Performance
Evaluation Results Special rewards for employee's outstanding
performance:
a) Special increment
b) Extraordinary bonus -financial incentive
c) Appreciation Letter -non-financial incentive
d) Overseas Tour -overseas relevant training
course/ workshops/ seminar
Negative Incentives for Poor Performers:
a) No promotion
b) Disciplinary action
may range from:
i. withholding of annual bonus
ii. annual increment
iii. termination.
Promotion
Promotion is given as recognition of :
• employee’s past performance
• future potentiality of carrying out
responsibilities in higher position
• based on merit and/or seniority
Basic Principles of Promotion:
• Cannot be claimed as a mater of right, one has to
earn it.
• In all matters relating to promotion the decision of
the Head of the organization should be final
• Not automatic. The completion of the requisite
number of years should entitle one to be considered
for promotion.
• Availability of vacancy or creation of new
positions when possible and necessary.
• On the basis of merit, performance and seniority of
the staff.
• Female staff should be given preference (to raise
the percentage up to 50%).
• The organization shall keep some positions reserve
for female staff.
• gender equality
• Three months observation period (for assessing
their performance in new position)
Below an example of an organization consideration for promotion to the next higher position as per the following:
Sl. Position Number of
years
Next position
1 Support staff (SS) –I 3 Support staff –II
2 Driver –I 3 Driver –II
3 Assistant Program Organizer (APO) 3 Senior Assistant/Program Organiser
4 Senior Assistant/Program Organizer 3 Assistant Manager/Assistant
Officer/Executive Assistant
5 Assistant Manager/Assistant
Officer/Executive Assistant
3 Deputy Manager/Deputy officer
6 Deputy Manager/Deputy officer 3 Manager/Officer
7 Manager/Officer 3 Deputy Senior Manager
8 Deputy Senior Manager 3 Senior Manager
9 Senior Manager 3 Assistant Director
10 Assistant Director 3 Deputy Director
11 Deputy Director 3 Director
12 Director 3 Deputy Head of the organization