Post on 14-Aug-2015
PERFORMANCE APPRAISAL METHODS
SUBMITTED BY
MOHD AAMIR (PM/2014/406)
NIPER HYDERABAD
How it is defined?
Performance appraisal refers to all those procedures that are used to evaluate the
Personality
Performance
Potential of a group
Objectives of Performance appraisal
Performance appraisal can be done by keeping the following objectives in mind To maintain records in order to determine compensation packages, wage structure, salaries raise etc.To identify the strength and weaknesses of employees to place right men to right job.To assess the potential present in a person for further developmentIt serves basis for influencing working habits of employees.
Advantages of Performance appraisal
Performance appraisal is the investment for the company which can be justified by following :
Promotion
Compensation
Employees development
Selection validation
Communication
Motivation
TYPES OF APPRAISAL METHODS
Appraisal methods can be broadly classified into two groups :
Past oriented methods
Future oriented methods
PAST ORIENTED METHODS
Rating scales
Checklist
Force choice method
Critical incident method
Field review method
Confidential records
Essay method
Cost accounting method
RATING SCALES It consists of several numerical scales each representing a job related performance criterion such as dependability, initiative, output, attendance, attitude, co-operation. The one major provision in selecting traits is that they should be in some way relevant to the appraisee's job.
ADVANTAGES DISADVANTAGES
Structured and standardized. This allows ratings to be easily compared and contrasted - even for entire workforces.
Trait relevance
Same basic appraisal process and rating criteria.
Encourages equality in treatment for all appraises
It is possible that an employee's performance may depend on factors that have not been included in the selected traits.
Rating scale methods are easy to use and understand
Selective perception i.e. assessments of what a person is "really like", and then seek evidence to support that view
The result is widespread acceptance and popularity for this approach.
Problems of perceived meaning occur when appraisers do not share the same opinion about the meaning of the selected traits and the language used on the rating scales.
Checklist Checklist contains a list of statements on the basis of which the rater describes the on job performance of employees
Forced Choice Method In the forced choice method the rater is forced to select statements which are readymade.
This method makes use of several sets of pair phrases, two of which may be positive and two negative and the rater is asked to indicate which of the four phrases is the most and least descriptive of a particular worker.
Favorable qualities earn plus credit and unfavorable ones earn the reverse
Field review method The appraiser goes to the field and obtains the information about work performance of the employee.
Questioning the individual, his peer group , and his superiors.
At this stage it would not be out of context to mention some of the limitations associated with trait-based methods of performance evaluation.
First, the trait-based methods are based upon traits (like integrity and consciousness) which may not be directly related to successful job performance. An employee can change behavior, but not personality.
Critical incident technique
Managers prepare a list of very effective and ineffective behavior of an employee
These critical incident represent the outstanding or poor behavior of the employees
The manager periodically records critical incidents of employee behavior .
Example
Feb 25 : Sales clerk patiently attended to the customers complaint. He is polite, prompt, enthusiastic in solving customer problems
Feb 26 : Sales assistant stayed 45 mins beyond his break during the busiest part of the day. HE failed to answer the store manager’s call thrice. He is uninterested in work.
Limitations of critical incident technique
Negative incidents may be more noticeable than positive incidents
Results in very close supervision which may not be liked by the employee
The recording of the incident is the chore for the supervisor concerned who may be too busy or forget to do it.
ESSAY EVALUATION METHOD The rater is asked to express the strong as well as the weak points of employee’s behavior
Rater’s consider the employee’s :
oJob knowledge and potential
oUnderstanding company’s programs, policies, and objectives
oRelation with coworkers and supervisors
o Planning, organizing, or controlling activity
oAttitude and perception
Limitations of essay evaluation method
Highly subjective.
Supervisor may write biased essay.
Difficult to find effective writers.
A busy appraiser may write the essay hurriedly without assessing properly the actual performance of the worker.
If the appraiser takes a long time it becomes uneconomical from the point of view of the firm.
CONFIDENTIAL REPORTS It is mostly used in government organizations.
Prepared, generally at the end of every year, by the employee’s immediate superior.
It does not offer any feedback to the appraisee.
Appraisee does not know about :
Why his ratings have fallen despite his best efforts
Why others are rated high when compared to him, how to rectify his mistakes.
NOTE : In recent years, due to pressure from courts and trade unions, the details of a negative confidential report are given to the appraise.
COST ACCOUNTING METHOD HRA is the process of Assigning, budgeting, and reporting the cost of human resources incurred in an organization, including wages and salaries and training expenses
Human resource accounting method tries to find the relative worth of these assets in the terms of money.
In this method the Performance appraisal of the employees is judged in terms of cost and contribution of the employees.
The cost include all the expenses incurred on them like their compensation, recruitment and selection costs, induction and training costs
Contribution includes the total value added (in monetary terms)