Module 2

Performance appraisal
 Meaning

PA is a method of evaluating the

behaviour of employee at work spot,

including both qualitative and

quantitative aspects of job performance

 Features

• Systematic description of strengths and weakness

• Employee performance and improvement

• Periodic appraisals

• Continuous process
 Need
• Performance ranks, salary and wage fixation,
promotion, transfer, demotion.
• Feedback
• Training
• Counselling
• Grievance and disciplinary actions
 Objectives
• Satisfactory level of performance
• Growth and development
• Compensation
• Training
• Testing and validating selection tests
• Decisions on lay off, promotion etc.
• Ensure organisational effectiveness
 Content for PA

• From JA
Eg.
Regularity of attendance

Self expression

Ability to work with others

Initiative

Technical skill

Knowledge

Quick learner

integrity
 Appraisers
360 degree Performance Appraisal
• Supervisors
• Subordinates
• Peers
• Self appraisal
• Users of service/customers
• Consultants
Performance appraisal methods
 Methods
Traditional methods
• Graphic rating scale
• Ranking method
• Paired comparison
• Forced distribution
• Checklist
(simple,weighted,CI)
• Essay or Free form
• Group appraisal
• Confidential reports
Modern methods
• BARS
• Assessment centre
• HRA
• MBO
• Behaviour observation
scales
• Psychological appraisal
• Results method
• Productivity measures
• Balance scorecard
 Behaviourally Anchored Rating Scale
Combines both traditional rating scales and critical incident
Step 1: collect critical incidents ( effective and ineffective
behaviours to job performance)

Step 2: identify performance dimensions

Derive key set of performance dimension from CI
Step 3: Reclassification of incidents

Step 4:Assigning scale value to the incidents

Step 5:producing final instrument

Seven incidents for each performance dimension
 Assessment Centres
A system or organisation where assessment of
several individuals is done by various experts using
various techniques.

In basket exercises
Role playing
Case studies
Simulation exercises
Transactional analysis
Structured insight
 Human resource Accounting
Deals with the cost and contribution of HR of
organisation

Management by objectives
 Behaviour observation scales
The appraiser measured how frequently each of the
behaviour has been observed

Appraiser plays the role of observer rather than judge and

provides the feedback to the appraisee continously.

•Maintains objectivity
•Differentiate good performers from poor performers
•Provides feedback
•Identify training needs better than those chosen by other
methods
 Psychological Appraisal

To assess employee potential

Psychological tests
In depth interviews
Consultations and discussions
Review
 Results method

Output vs behaviour factors/traits

 Productivity measure
• Output to input used
 Balanced Score card
• Translate strategy into clear objectives
• Attach measures to each objective
(achievement details)
• Provide feedback
• Empower employee for performance
improvements
• Reassess strategy
 Performance appraisal process
• Establish performance standards
• Communicate the standards
• Measure actual performance
• Compare actual performance with standards
and discuss the appraisal
• Taking corrective action
 Performance management
Performance management is a systematic
process of improving the performance and
developing the capabilities of teams and
individuals in an organisation.
 Differences between PA and PM
PA
• Top-down assessment
• Annual appraisal meeting
• Use of ratings
• Monolithic system
• Focus on quantified objectives
• Often linked to pay
• Bureaucratic – complex
paperwork
• Owned by the HR department
PM
• Joint process through dialogue
• Continuous review with one or
more formal reviews
• Ratings less common
• Flexible process
• Focus on values and behaviours as
well as objectives
• Less likely to be a direct link to pay
• Documentation kept to a minimum
• Owned by line managers