Factors impacting performance

f (indi. attributes + wk effort + orgn support)

f (ability + motivation + opportunity)

f (knowledge + motivation + feedback + leadership + personality)

PA to PMFROM TOSystemAppraisalOutputsReward orientedRatings commonTop downDirectiveMonolithicOwned by HR

ProcessJoint reviewOutputs/InputsDevelopment orientedLess rating3600 feedbackSupportiveFlexibleOwned by users

Performance

Management

Process

Performance Planning & Goal setting

Observation of performance & continual Feedback

Performance Appraisal using a predetermined format

AppraisalInterview

Using the results for different organizational decisions

WHY? Purpose of PM SystemûStrategic: help top mgmt achieve strategic

objectiveûAdministrative: furnish valid information to

make admin decisions about employeesûDevelopmental: allow managers to coach

employeesûInformational: inform employees about their

performance and expectations from themûOrganisational maintenance: provide information

to be used in HR planning and allocationûDocumentational: collect information that can be

used for different purposes

WHEN? Frequency of Appraisal

û Informal evaluation – Continuous

û Formal evaluation – Annual or Biannualó Anniversary date approachó Focal point approach

WHAT? Criteria used

Traits or characteristics

Actual performance

Training Needs Potential

Behaviour

WHO are the appraisers?

û Superior(s)û Selfû Committeeû Peersû Subordinatesû Customers – internal and external

Performance Appraisal Methods

1 6

2

3

4

5

Alternation ranking

Graphic rating scale

Paired comparisonForced distributionCritical incident

7

8

9

10

Behaviorally anchored rating scales (BARS)

Narrative forms

MBO

Computerized and Web-based methods

Merged methods

Appraisal Methodologies

Scale for Alternate Ranking of Appraisee

Ranking Employees by the Paired Comparison Method

Note: + means “better than.” - means “worse than.” For each chart, add up the number of +’s in each column to get the highest ranked employee.

Forced Distribution on a Bell-Shaped Curve

Examples of Critical Incidents for Assistant Plant Manager

Continuing Duties Targets Critical Incidents

Schedule productionfor plant

90% utilization of personnel and machinery in plant; orders delivered on time

Instituted new production scheduling system; decreased late orders by 10% last month; increased machine utilization in plant by 20% last month

Supervise procurement of raw materials and on inventory control

Minimize inventory costs while keeping adequate supplies on hand

Let inventory storage costs rise 15% last month; over-ordered parts “A” and “B” by 20%; under-ordered part “C” by 30%

Supervise machinery maintenance

No shutdowns due to faulty machinery

Instituted new preventative maintenance system for plant; prevented a machine breakdown by discovering faulty part

Narrative Forms

û Final appraisals are frequently written in a narrative form

û Supervisor rates employee by describing the behaviour related to each factor

Graphic Rating Form

Behaviorally Anchored Rating Scale (BARS)

û BARS is an appraisal tool that anchors a numerical rating scale with specific examples of good or poor performance.

û Its proponents say it provides better, more equitable appraisals than do the other appraisal tools.

û It takes more time to develop a BARS, but the tool has several advantages.

Example of a Behaviorally Anchored Rating Scale for the Dimension Salesmanship Skills

Management byObjectives

MBO refers to a organizational 6 step goal setting and appraisal program

Set theorganization’s

goals

Set thedepartmental

goals

Discussdevelopmental

goals

Defineexpectedresults

Performancereviews

Providefeedback

Defining the Employee’s Goals and Work Standards

Set SMART goals

Assign challenging/ doable goals

Assign specific goals

Guidelines for Effective

Goal Setting

Assign measurable

goals

Encourage participation

Appraisal Form for Assessing Both Competencies and Specific Objectives

Appraisal Form for Assessing Both Competencies and Specific Objectives (cont’d)

Choosing the Right Appraisal Tool

Accessibility AccuracyEase-of-use Employee acceptance

Criteria for Choosing an Appraisal Tool

Errors in Performance Measurement

RATER ERROR

Varying standards

Primacy and Recency Error

Leniency/Strictness/ Central Tendency

Rater bias

Halo / Horns

Contrast error

Similar-to-me Error

Sampling error

PRACTICAL IMPACT

Similar perf is rated differently

Timing of information affects rating

Everyone is rated the same

Rater prejudices affect rating

Generalisation is made from only one traitComparison is made to other people not standards

Rater compares employee to self

Available information is insufficient or inaccurate

The Appraisal Interview

Satisfactory—Promotable

Satisfactory—Not Promotable

Unsatisfactory—Correctable

Unsatisfactory—Uncorrectable

Types of Appraisal Interviews

Performance Feedback

Components of a Feedback System

Data on Actions

Data Evaluation

Action Based on Evaluation