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Performance Appraisal
The identification, measurement,and management of humanperformance in organizations.
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8-5
Performance Evaluation
and ManagementPerformance Management: efforts to alignemployee performance with the firms goals
Performance Evaluation:efforts to determinethe extent to which an employee performswork effectively. Also known as:
Performance reviewPersonnel ratingMerit rating
Performance appraisalEmployee appraisalEmployee evaluation
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9-3Potential Purposes ofEvaluation
Development
Motivation
HRM
ResearchCommunications
Legal
Compliance
HR and
Employment
Planning
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A Model of PerformanceAppraisal
Identification
Measurement
Management
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9-5
Reliability
RelevanceSensitivity
Practicality
Evaluation:
Criteria of Evaluation
Combination of criteria using activities
and results is desirable
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9-6Who Should Evaluatethe Employee?
Immediate supervisor only (typical)
Committee of several supervisors
Employees peers (coworkers)
Employees subordinates
Someone outside the immediate worksituation
Self-evaluation
MANY POSSIBILITIES
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Some Potential
Benefits
Encourages employeeparticipation
Enables subordinates toexercise self-control
and manage ownperformance
Useful for training andcareer development
anagemen yObjectives
(MBO) Some PotentialPitfalls
Managers may not beadequately preparedfor MBO
Demands active
employee and managerinvolvement
Too much emphasis onthe short run and
P t ti l E l ti
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9-12Potential EvaluationProblems
Opposition to evaluation
System design and operatingproblems
Rater problems include:Problems withstandards
of evaluation
Halo effectsLeniency or
harshness
Central tendencyerrors
Recency of events
errorsContrast effects
Personalbias/stereotyping
Major problems exist more with
the rater than the technique used.
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Solutions to EvaluationProblem
ELIMINATING
RATER
ERRORS
Train raters onhow to evaluateothers well
Grant ampleopportunities to
AVOIDING
PROBLEMS
WITH EMPLOYEES Train employees inperformance evaluation
methods Simplify reporting forms Communicate howevaluation information is
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The Benefits ofPerformance Appraisal
Employer Perspective:
Despite imperfect measurement techniques, individualdifferences in performance can make a difference to companyperformance.
Documentation of performance appraisal and feedback maybe needed for legal defense.
Appraisal provides a rational basis for constructing a bonus ormerit system.
Appraisal dimensions and standards can help to implement
strategic goals and clarify performance expectations.
Providing individual feedback is part of the performancemanagement process.
Despite the traditional focus on the individual, appraisalcriteria can include teamwork and the teams can be the focus
of the a raisal
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Appraisal, and Outcome AppraisalInstruments
An appraisal tool that asks a supervisor to make judgmentsabout worker characteristics that tend to be consistent andenduring.
An appraisal tool that asks managers to assess a workers
behaviors.
An appraisal tool that asks managers to assess the resultsachieved by workers.
Trait Appraisal
Behavioral Appraisal
Outcome Appraisal
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Sample Trait ScalesRate each worker using the scales below.
Decisiveness:
1 2 3 4 5 6 7
Very low Moderate Very high
Reliability:
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
Loyalty:
1 2 3 4 5 6 7
Very low Moderate Very high
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Evaluation of MajorAppraisal Formats
Absolute
RelativeTrait
Behavior
Outcome
0
+++
0
0
+
--
+
0
0
---
++
+
AppraisalFormat
AdministrativeUse
DevelopmentalUse
LegalDefensibility
-- Very Poor - Poor + Good ++ Very good0 Unclear or mixed
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Who Should Evaluatethe Employee?
Alternative to
traditionalsupervisor-onlyapproaches
Uses multiple
appraisers
Not a anacea
9-7
360-DEGREE FEEDBACK
Subordinates
Peers
Supervisors
Self-appraisal
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Challenges to EffectivePerformance Measurement
Rater errors and bias
The influence of liking
Organizational politics
Whether to focus on the
individual or the group Legal issues
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Legal Issues Arecent analysis of 295 court cases involving
performance appraisal found judges decisions to befavorably influenced by the following additional factors:
Use of job analysis Providing written instructions
Allowing employees to review appraisal results
Agreement among multiple raters (if more than onewas used)
The presence of rater training
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Communication Skills for theAppraisal Interview
NonverbalAttending
Open andClosedQuestions
Suggests interestand active listening.
Appropriate use ofopen and closedquestions canensure an effectiveflow of
communicationduring an interview.
Rater sits with a slightforward, comfortablelean of the upper body,maintains eye contact,and speaks in a steady
and soothing voice.Open questionsencourage informationsharing and are mostappropriate early in aninterview or in complex,
ambiguous situations.Closed question evokeshort responses and areuseful for focusing andclarifying.
While the ratee isspeaking, the raterlooks at the personand gently nods headto signal interest.
Open questionsstart with words likeCould, Would,
How, What, or
Why.
Closed questionsstart with words likeDid, Is, or Are.
Skills Benefit Description Example
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Communication Skills for theAppraisal Interview (Cont.)
CulturalSensitivity
Communication is moreeffective when you aresensitive to the possibleinfluence of cultural
differences.
Pay attention to culturaldifferences that mayinfluence how anotherperson communicates
and how you mightcommunicate withothers.
When dealing withemployees from aculture that is highlyformal, avoid
addressing them in theworkplace by their firstnames. Doing so maysignal disrespect.
Skills Benefit Description Example
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Key Steps in Implementing360 Appraisal
Top management communicates the goals of and need for360 appraisal.
Employees and managers are involved in the development ofthe appraisal criteria and appraisal process.
Employees are trained in how to give and receive feedback.
Employees are informed of the nature of the 360 appraisal
instrument and process.
The 360 system undergoes pilot testing in one part of the
organization.
Management continuously reinforces the goals of the 360
appraisal and is ready to change the process when necessary.