By Aliston Braganza Vasudev LotliKer Monica Sharma

Definition
According to Newstrom, It is the process of

evaluating the performance of employees, sharing that information with them and searching for ways to improve their performance. It is the step where management finds out how effective it has been at hiring and placing employees.

Objectives of Performance Appraisal

Personal Development
Feedback Compensation Decision

Data Base
Training and Development Programme Promotion Decision Improves Supervision

Uses of Performance Appraisal

Performance improvements
Compensation Decision Placement Decision

Training and Development Needs

Career Planning and Development Feedback to Human Resource

Process of Performance Appraisal

Setting Performanc e Standards Taking Corrective Standards Communicatin g Standards

Discussing Results Comparin g Standards

Measuring Standards

Methods
Traditional
Ranking Method Forced Distribution Critical Incidents Checklist Graphic Rating Free Essay

Modern
Behaviorally Anchored

Rating Scales Management By Objectives Human Resource Accounting 360 Degree Performance Appraisal Self Appraisal

Traditional Methods
Ranking Methods-Rater ranks his subordinates on

overall performance.
Forced Distribution Here rater are required to

allocate a certain percentage of rates to certain category.

Critical Incidents Here the manager prepares a

list of statements of very effective or ineffective behaviour of employees.

Cont
Checklist- It represent a simplest form, where a set

of objectives or descriptive statement about the employee and his behaviour.

Graphic Rating Evaluation using the graphic

rating scale.
Free Essay Here evaluator describes in his own

words what he/she perceives about the employees performance .

Modern Methods
Behaviorally Anchored Rating Scales It is based on

making rates on behaviors or sets of indicators to determine the effectiveness or ineffectiveness of working performance.
Management By Objectives Here managers and

employees sets a list of objectives and make assessments on their performance on regular basis. And finally make rewards based on the result achieved.

Cont
Human Resource Accounting: here the performance

o employees is judged in terms of cost and contribution of the employee.

360 Degree Performance Appraisal Here

employee receive performance feedback from all.

Self Appraisal- Gives chance to the employee to

look at his/ her strengths and weaknesses, his achievements, and judge his own performance.

Essential of a Good Appraisal System

Reliability and Validity
Job Relatedness Standardization Practical Viability Training Viability Open Communication Employee Access to Results

Clear Objectives
Post Appraisal Interview Periodic Review

Not Vindictive in Nature

Pitfalls in Performance Appraisal

Shifting standards
Different raters pattern First impression Latest behaviour

Halo effect
stereotyping

Constraints
Lack of trust and openness in people and

conservativeness

Low motivation Lack of proper system/ procedure Lack of clarity on role, goal, job demands, etc Constraint of time availability Interference by trade unions in case of workers

Ways For Improving Performance Appraisal

Choosing the Appraisal Methods
Multiple Raters Training Appraisers Ongoing Feedback Selective Rating Peer Evaluation Post- appraisal interviews Reward to Accurate Appraisers

Developing A Performance Appraisal

Determine overall approach to performance appraisal Where and how should PA be introduced? Decide who is to be covered? Decide on whether the same approach should be adopted at each level Set up project team Define role of human resource department Decide whether to use outside consultants Define performance management process and documentation Pilot test Plan implementation programme