WRITTEN REPORT IN INDUSTRIAL

PSYCHOLOGY
PERFORMANCE APPRAISAL
(PURPOSE, RATINGS AND TECHNIQUES)

Submitted to:
Mrs. Alejandro

Submitted by:
Rodegerio, Nerissa I.
TF / 10:30am – 12:00nn
 PERFORMANCE APPRAISAL

A performance appraisal is a regular review of an employee's job performance and

overall contribution to a company. Also known as an "annual review,"
"performance review or evaluation," or "employee appraisal," a performance
appraisal evaluates an employee’s skills, achievements and growth, or lack thereof.

PURPOSE OF PERFORMANCE APPRAISAL

 Performance appraisal system is used in the organizations to measure the

effectiveness and efficiency of their employees.

 Performance Appraisal system is needed because every employee has a

different attitude to handle the work (stress) .

 Performance Appraisal tends to improve the work performance,

communication expectations, determining employee potential and aiding
employee counseling.

 Companies use performance appraisals to give employees big-picture

feedback on their work and to justify pay increases and bonuses, as well
as termination decisions. They can be conducted at any given time but tend
to be annual, semi-annual or quarterly.

DIFFERENT TECHNIQUES OF PERFORMANCE APPRAISAL

TRADITIONAL METHODS

1. Graphic Scale Rating Method – the oldest and simplest method of

performance appraisal. In this method, the appraiser ranks the employee
from the best to the poorest on the basis of their performance.
2. Critical Incident Method – In this method, the evaluator rates the employee
on the basis of the critical events and how the employee behaved during
those incidents.
3. Essay Appraisal Method – also known as the “Free Form Method” which
involves the description of the performance of the employee by his superior.
The description will then be the evaluation based on facts.
 4. Checklist – is a list of statements that describe the characteristics and
performance of the employee on the job. The ratter checks to indicate if the
behavior of an employee is positive or negative to each statement.
5. Paired Comparison Method - Under this method, the pairs of employees of
same job post or level are evaluated on the basis of performance of each
other. Subjects like skills, experience, team player, behavior, etc. are
evaluated by the raters and picks the best performing employee.
6. Group Appraisal - Employees are rated by a group of people comprising the
immediate supervisor of the employee and other supervisor who have the
knowledge of the employee work along with the concerned head of the
department and a personnel expert.
7. Field review method - is conducted by the rater who does not belong to the
employees’ department. The rater is someone from the corporate, especially
from HR department. Use of this technique to evaluate employees’
performance is helpful in completely eliminating issues that arise due to
rater’s biasedness.
8. Forced Distribution Method - Under this method, raters are forced to divide
his employees evenly into certain categories which vary from organization to
organization. The categories can be poor, average, good and excellent or
percentile based like 10% poor, 20% below average, 40% average, 20% good
and 10% excellent.

MODERN METHODS

1. Management by Objectives (MBO) - is a personnel management technique where

managers and employees work together to set, record and monitor goals for a
specific period of time.
2. Behaviorally Anchored Rating Scale - is a measuring system which rates
employees or trainees according to their performance and specific behavioral
patterns. Behaviorally Anchored Rating Scale (BARS) compare an individual’s
performance against specific examples of behavior that are anchored to
numerical ratings.
3. Humans Resource Accounting is the process of evaluating monetary benefits
yield to the organization from the job performance of an employee. In other
 words, this method is used to analyze the cost of keeping the employee and
the benefits the company derives from his/her presence and / or absence.
4. 360-degree appraisal - Under this method, an employee’s job performance is
appraised by the help of the factors that are present around him at the
workplace. (superiors, colleagues, subordinates and even clients, customer).
An evaluator asks various questions to these factors and collects their
feedback.

360-degree method is considered to be the most effective way of

appraising employee’s performance as information and feedback is
collected from all around.