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Appraising Workrelated performance
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Performance Appraisal
After employees have been on the job for some time,
you should appraise their performance.
The purpose of this lecture is to cover the
performance appraisal process, appraisal methods,
appraisal performance problems and solutions,
performance management, and the appraisal interview.
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93
Basic Concepts in PerformanceManagement and Appraisal
Performance Appraisal
Setting workstandards, assessing
performance, and
providing feedback to
employees to
motivate, correct, and
continue their
performance.
Performance
Management
An integrated
approach to ensuring
that an employees
performance supports
and contributes to the
organizations
strategic aims.
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Performance Appraisal
Every manager needs some way to appraise employees
performance. If employees performance is good, youll want toreinforce it, and if its bad, youll want to take corrective action.
Performance appraisal means evaluating an employees
current and/or past performance relative to his or her
performance standards.
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Performance Appraisal
Every manager needs some way to appraise employees
performance. If employees performance is good, youll want to
reinforce it, and if its bad, youll want to take corrective
action.
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Performance appraisal
Performance appraisal means evaluating an employees
current and/or past performance relative to his or herperformance standards.
Copyright 2011 Pearson Education, Inc. publishing as Prentice Hall 96
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Defining the Employees Goalsand Work Standards
Set
SMART
goals
Assign
challenging/
doable goals
Assign
specific
goals
Guidelines for Effective
Goal Setting
Assign
measurable
goals
Encourage
participation
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Copyright 2011 Pearson Education, Inc. publishing as Prentice Hall 98
Setting SMART Goals
Specific, and clearly state the desired results.
Measurable in answering how much.
Attainable, and not too tough or too easy.
Relevant to whats to be achieved.
Timely in reflecting deadlines and milestones.
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Appraisals
Appraisals have several purposes that relate both to the
appraised employee and the organization.
It doesnt matter which tool you use if youre less than
candid when your subordinate is underperforming. A
supervisor who rates an employee too high is doing adisservice to them and to the company.
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Theres nothing worse than telling someone whos doing a
mediocre job that he or she is doing well.
Supervisors must therefore be familiar with appraisal
techniques, understand and avoid problems that cancripple appraisals, and know how to conduct appraisals
fairly.
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911
An Introduction to Appraising Performance
1
Is useful in career planning.
Plays an integral role in performance management.
Why Appraise Performance?
Is basis for pay and promotion decisions.
Helps in correcting deficiencies and reinforcing good
performance.
2
3
4
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Copyright 2011 Pearson Education, Inc. publishing as Prentice Hall 912
Performance Appraisal Roles
The Supervisors Role
Usually do the actualappraising
Must be familiar with basic
appraisal techniques
Must understand and avoid
problems that can cripple
appraisals
Must know how to conduct
appraisals fairly
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HR Policy making
The human resources department serves a policy-making
and advisory role.
The human resource team should also be responsible for
training supervisors to improve their appraisal skills, formonitoring the appraisal systems effectiveness, and for
ensuring that it complies with appropriate equality laws.
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914
Performance Appraisal Roles (contd)
The HR Departments Role
Serves a policy-making and advisory role.
Provides advice and assistance regarding the appraisal tool to use.
Trains supervisors to improve their appraisal skills.
Monitors the appraisal system effectiveness and compliance with
EEO laws.
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915
Effectively Appraising Performance
1
Appraising performance
Steps in Appraising Performance
Defining the job and performance criteria
Providing feedback session
2
3
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Appraisals
Effective appraisals should follow these three steps.
The manager generally conducts the actual appraisal usinga predetermined and formal tool like one or more of those
described next.
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Appraisals
The two basic questions in designing the actual appraisal
tool are
what to measureand
how to measure it.
Appraising performance requires choosing an appraisal
tool, form, or methodology that provides an effectivemeans for comparing a subordinates actual performance
to the standards for his or her job.
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918
Designing the Appraisal Tool
What to Measure?
Work output (quality and quantity)
Personal competencies
Goal (objective) achievement
How to Measure?
Generic dimensions
Actual job duties
Behavioral competencies
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919
Performance Appraisal Methods
1
2
3
4
5
Alternation ranking
Graphic rating scale
Paired comparison
Forced distribution
Critical incident
6
7
8
9
10
Behaviorally anchored rating
scales (BARS)
Narrative forms
Management by objectives (MBO)
Computerized and Web-based
performance appraisal
Merged methods
Appraisal Methodologies
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Written Appraisal
All or part of the written appraisal may be in narrative form
as shown in Figure 9-7 which follows .
The supervisors narrative assessment aids the employee
in understanding where his or her performance was good
or bad, and how to improve that performance.
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921
FIGURE 97
Appraisal-Coaching
Worksheet
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MBO
Employers use management by objectives (MBO) for one of
two things.
Many use it as the primary appraisal method.
Others use it to supplement to a graphic rating or otherappraisal method.
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MBO
MBO generally refers to the comprehensive and formal
organization wide goal-setting and appraisal program.
In using MBO, it is best to keep the guidelines for goalsetting (SMART, specific, and so on) in mind.
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Setting objectives with the subordinate sometimes turnsinto a tug-of-war, with the supervisor pushing for higher
quotas and the subordinate pushing for lower ones.
The more that is known about the job and the persons
ability, the more confident a supervisor can be aboutsetting standards.
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925
Management by Objectives (MBO)
A comprehensive and formal organizationwide
goal-setting and appraisal program requiring:
1. Setting of organizations goals
2. Setting of departmental goals
3. Discussion of departmental goals
4. Defining expected results (setting individual goals)
5. Conducting periodic performance reviews
6. Providing performance feedback
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Copyright 2011 Pearson Education, Inc. publishing as Prentice Hall 926
Using MBO
Setting unclear
objective
Conflict with
subordinates over
objectives
Potential Problems with MBO
Time-consuming
appraisal process
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Copyright 2011 Pearson Education, Inc. publishing as Prentice Hall 927
Computerized and Web-BasedPerformance Appraisal Systems
Allow managers to keep notes on subordinates.
Notes can be merged with employee ratings.
Software generates written text to support appraisals.
Allows for employee self-monitoring and self-evaluation.
Electronic Performance Monitoring (EPM) Systems
Use computer network technology to allow managers access to
their employees computers and telephones. Managers can monitor the employees rate, accuracy, and time
spent working online.
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Dealing with PerformanceAppraisal Problems
Unclear
standards
Leniency or
strictness
Halo
effect
Potential Rating Scale
Appraisal Problems
Central
tendencyBias
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Unclear standards problem.
Table 9-2 which follows illustrates the unclear
standards problem. This graphic rating scale seems objective. However, it
would probably result in unfair appraisals, because the
traits and degrees of merit are ambiguous.
The best way to fix this problem is to include descriptivephrases that define or illustrate each trait.
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930
TABLE 92 A Graphic Rating Scale with Unclear Standards
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931
Guidelines for Effective Appraisals
Know the
problems
Get
agreement on
a plan
Use the
right tool
How to Avoid
Appraisal Problems
Keep a
diary
Be
fair
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Using the right appraisal toolorcombination of tools.
Each has its own pros and cons. For example, the ranking method avoids central tendency but
can cause bad feelings when employees performances are
in fact all high.
Table 9-3 which follows summarizes each tools pros andcons.
In practice, employers choose an appraisal tool based on
several criteria.
Accessibility and ease-of-use are probably first. Employers (and supervisors) prefer to avoid thepush-back
from employees who resist certain appraisal methods.
For other employers, accuracyis a great concern.
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Copyright 2011 Pearson Education, Inc. publishing as Prentice Hall 933
TABLE 93 Important Advantages and Disadvantages of Appraisal Tools
Tool Advantages Disadvantages
Graphic rating scale Simple to use; provides a quantitative
rating for each employee.
Standards may be unclear; halo
effect, central tendency, leniency,bias can also be problems.
BARS Provides behavioral anchors. BARS
is very accurate.
Difficult to develop.
Alternation ranking Simple to use (but not as simple as
graphic rating scales). Avoids central
tendency and other problems of rating
scales.
Can cause disagreements among
employees and may be unfair if all
employees are, in fact, excellent.
Forced distribution
method
End up with a predetermined number
or % of people in each group.
Employees appraisal results
depend on your choice of cutoff
points.
Critical incident
method
Helps specify what is right and
wrong about the employees
performance; forces supervisor toevaluate subordinates on an ongoing
basis.
Difficult to rate or rank employees
relative to one another.
MBO Tied to jointly agreed-upon
performance objectives.
Time-consuming.
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934
Choosing the Right Appraisal Tool
Accessibility AccuracyEase-of-useEmployee
acceptance
Criteria for Choosing an
Appraisal Tool
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Best Practice
One study found that a number of best practices, such
as have an appeal mechanism, distinguish fairappraisals.
Figure 9-10 which follows summarizes these.
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936
Who Should Do the Appraising?
Self-rating
Subordinates
360-degree
feedback
PotentialAppraisers
Immediate
supervisor
Peers
Rating
committee
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937
The Appraisal Interview
SatisfactoryPromotable
SatisfactoryNot Promotable
UnsatisfactoryCorrectable
UnsatisfactoryUncorrectable
Types of AppraisalInterviews
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Form
Figure 9-12 which follows presents a form that can be
used when the persons performance is unsatisfactory
but correctable and the interview objective is to lay out anaction plan for correcting the unsatisfactory performance.
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939
FIGURE 912 Sample Employee Development Plan
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4 things
These are four main things to keep mind when actually
conducting the interview.
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Appraisal Interview Guidelines
Talk in terms of
objective work
data
Get
agreement
Dont get
personal
Encourage the
person to talk
Guidelines for Conducting
an Interview