HRMT300 lecture 9 PERFORMANCE APPRAISAL

Revision

•_{Lecture 1 – evolution of HRM} •_{Lecture 2 – overview of HRM}

•_{Lecture 3 – Human resource planning} •_{Lecture 4 – Job analysis}

•_{Lecture 5 – Recruitment} •_{Lecture 6 - Selection}

•_{Lecture 7 – Training and development} •_{Lecture 8 - Career Development}

•_{Lecture 9 – Performance Appraisal} •_{Lecture 10 – Employee motivation}

•_{Lecture 11 – Employee right and discipline}

PERFORMANCE

APPRAISAL

The Concept of Performance

•_{Performance can be defined as ‘the value attributed to}

particular behaviours by an organization that leads to attainment of important organizational goals’.

• _{Behaviour in the context of a job, position or role}

imbued (filled) with value because of what it leads to (achieving organisational goals) (Campbell 1991).

• _{Is performance the act itself (behaviour) or the output}

The Concept Of Performance

(Cont)

•_{Complying with organisational values and policies} •_{Applying extra effort to the job}

•_{Staying with the organization during hard times and} •_{Representing the organization favourably to}

outsiders

•_{The concept of POB is similar to OCB but includes}

What is Performance Appraisal

(PA)?

 _{A formal organizational procedure for assessing}

employee proficiency.

 _{A systematic process designed to assess the extent}

to which employees are performing their jobs effectively.

 _{It is about measuring job performance.}

 _{NB: performance appraisal (PA) and performance}

management are used synonymously.

 _{Both involve measuring employee performance}

Purposes For Performance

Appraisal

Two main purposes:

 _{Human Resource Management / Administrative}

uses.

Human Resource Management/

Administrative uses of PA

_{The administration of wages and salaries /}

compensation/determining salary increases.

_{Making promotion decisions} _{Decisions on Transfers}

_{Making dismissals/termination decisions}

_{Identification of training needs for organization} _{Provision of criteria for evaluating selection}

procedures; - used to validate predictors for selection. (Provides accurate & reliable measure of job

Human Resources Management/

Administrative uses of PA (Cont.)

organization as a whole and the units within it

•_{Basis for evaluating the usefulness/effectiveness of}

training programmes

•_{Manpower / Staff planning decisions}

•_{Documentation;- provides the means for}

Developmental

Purposes of PA

•_{PA information provides means of improving}

employee performance by providing feedback to the appraisee.

•_{PA identifies employee weaknesses which can be}

Development Purposes of PA

(Cont.)

•_{Well conducted developmental appraisal is}

performed in a facilitative manner inviting self appraisal of personal strengths and limitations.

•_{Appraisal and development are now often}

inter-linked particularly in the application of Multi-Source - Multi-Rater / MSMR / 360 –degree feedback

MSMR Feedback System

 _{The MSMR feedback technique is a process by}

which performance evaluations of an employee, e.g. a manager, are collected from more than one source;

 _{Supervisors (downward appraisal)}  _{peers (horizontal appraisal,}

 _{subordinates (upward appraisal)}  _{sometimes customers.}

 _{self assessment, /self rating / self-evaluation on}

MSMR Feedback System

(Cont.)

•_{The ratings are compiled into a feedback report with}

the aim that the report can help the target person (e.g. manager) to identify his strengths and

weaknesses in performance.

•_{Enables manager to know whether his / her}

MSMR Feedback System (Cont.)

 _{The main objective:- the manager can use it to}

facilitate the development of his or her skills for performance improvement

 _{The MSMR is, therefore, mainly used for}

management development particularly

interpersonal relationships, leadership and team building and some other technical competences.

 _{MSMR: used for employee development and}

Appraisal Techniques/

Performance Ratings

Performance measures can be

• _{Subjective (for example, rating scales)}

•_{Objective: - the use of formalized performance}

Major Categories of

Performance Appraisal

Techniques

•_{Performance evaluation techniques can be grouped}

into four categories.

•_{Rating: employees are evaluated on a number of}

separate characteristics

•_{Ranking: employees are compared to each other} •_{Critical incidents: statements that describe a range}

of actual job behaviours are logged and evaluated as to whether they constitute effective or

ineffective behaviours.

•_{Other methods in which the criteria for evaluation}

Performance

Measurement

Types

•_{Graphic Rating Scale (GRS)}

• _{One of the oldest and the most widely used}

performance evaluation technique

•_{The evaluator is presented with a graph and is asked}

Performance Measurement

Types – GRS (Cont.)

•_{Employees are rated from low to high, or from}

unsatisfactory to outstanding along a set of one dimensional scales depicting various performance characteristics, e.g.,1 to 5; 1 to 7 where anchors may or may not be explicitly labeled (for example, low or high).

•_{Some scales include verbal designations for the}

midpoints of the continuum (e.g., very poor, poor, average, good, very good).

•_{Numerical weights are assigned to rating scale}

Performance

Measurement

Types – GRS (Cont.)

important/critical job behaviours, or evaluators may be asked to explain each rating with a

sentence or two.

Performance Measurements

Types (Cont.)

Behavioural Observation Scales (BOS)

•_{BOS rely on ‘critical behaviours’.}

•_{BOS evaluate the statements generated according}

to their frequency of occurrence in employee behavior.

•_{Response categories can be defined;}

Performance

Measurement

Types (Cont.)

•

_{Checklist Methods}

_:

•_{The checklist is a set of adjectives or descriptive}

statements of work behaviours.

•_{If the rater believes that the employee}

demonstrates/ possesses a characteristic listed, the rater checks the item; if not, the rater leaves it

blank.

•_{A rating score from the check list equals the number}

Performance

Measurements

Types (Cont.)

• _{Use descriptions of actual observed behavior as}

scale anchors.

•_{Operating managers and employees prepare lists /}

statements of very effective and very ineffective behavior in a job.

•_{The evaluator prepares a log for each employee.}

Performance Measurements

Types (Cont.) -Critical

Incidents

(outstandingly good or bad) behaviours, and the log is used to evaluate the employee at the end of the period.

• _{Very useful for the evaluation/post appraisal}

Performance Measurements

Types (Cont.) – Comparison

Formats

Ranking

:

•_{This involves rank ordering employees from highest}

to lowest on specific performance dimensions.

•_{Ranking is seldom a recommended approach.} •_{The criteria on which employees are ranked are}

Performance Measurements

Types (Cont.) – Comparison

Formats

Paired Comparison

•_{Involves comparing each employee with every other}

employee, on overall performance.

•_{The number of comparisons may be large, and}

Performance Measurements

Types (Cont.) – Comparison

Formats

•

_{Forced Distribution}

•_{similar to grades on normal distribution curve.}

•_{Evaluator is required to rate employees in some fixed}

distribution among performance levels. (E.g., top 5%, (outstanding) next 20% (good), next 50%

(average/satisfactory), next 20%, (unsatisfactory) last 5% (poor performers).

•_{Forced distributions are most suitable where there are}

Performance Measurements

Types (Cont.) – unspecified

Criterion

Essay Evaluation

•_{Evaluator is asked to describe the strong and weak}

aspects of the employee’s behavior.

•_{The essay can be open ended but in most cases there}

Performance Measurements

Types (Cont.) – unspecified

Criterion

Management by Objectives

•_{The supervisor and employee to be evaluated jointly}

set objectives in advance for the employee to try to achieve during a specified period.

•_{The evaluation consists of a joint review of the}

degree of achievement of the objectives.

•_{It enjoys a higher probability of being regarded as}

Common Performance

Appraisal Rating Errors

•_{Illusory halo / halo effect; tendency to rate an}

employee either high or low on many factors as the rater believes the employee is high or low on a

single factor.

•_{This may be triggered by characteristics on which}

an individual is deemed ‘conspicuously good or especially bad or by a general good or bad

impression (Drenth 1998). Positive halo; -high, high, etc. Negative halo;- low, low, etc.

•_{The halo effect is more likely when the}

Common Performance

Appraisal Rating Errors

(Cont.)

•_{Restriction of range errors: Overly severe (severity}

error), overly lenient (leniency error) or average rating (play safe) tendencies give rise to ratings in a restricted range across the distribution (for example ‘ceiling and ‘floor’ effects).

•_{These errors are directed at a total group rather}

than a single individual.

•_{Leniency is the most common range error. By being}

Post-Appraisal Interview:

Communicating Evaluating

Results

_•

Some suggestions for effective

communication in evaluation

interviews

•

_{Be prepared to discuss performance weighed}

against objectives for the period.

•

_{Allow time for the employee to discuss the}

evaluation, and future behaviour, and to

express his or her feelings.

•

_{Open with specific positive results; sandwich}

the criticisms between two positive comments

Some suggestions for effective

communication in evaluation

interviews

•_{Negative feedback should be oriented to}

performance comments, not personal comments.

•_{Emphasize that the purpose of discussing negative}

Some suggestions for

effective communication

in evaluation interviews

•_{The final aspect of the interview should focus on}

future objectives and how the superior can help the employee achieve organizational and personal goals.

•_{Possible training and development activities that}