PERFORMANCE APPRAISAL ITE 695

PERFORMANCE APPRAISAL “Process by which an organization measures and evaluates an individual employee’s behavior and accomplishments for a defined period of employment” (Dr. Anderson)

Reasons for Performance Appraisals n To effectively evaluate the work done buy an employee n To set a standard that can be used to judge future performance n Help a manager motivate employees and improve their performance n Strengthen communication

Reasons for Performance Appraisals (cont.) n Most people want to know how they are doing and this is a good way for them to learn n Let the employee know what is expected of them n Assist the employee in setting career goals n Help reward employees fairly

Reasons for Performance Appraisals (cont.) n Identify training the employee needs n Provide legal defensibility

REQUIREMENTS FOR ANY PERFORMANCE APPRAISAL TO BE SUCCESSFUL n The employer and the employee must have a clear idea of where the company is going n Employees understand how their job contributes to goals of the company n Employees and their supervisor agree on what is expected from the employee.

Requirements (cont.) n Employees are given the needed training to ensure they have the skills to perform their work n Supervisors give feedback to employees about their performance on a regular basis not just at formal appraisal times n Supervisors are trained on how to do performance appraisal

Typical Mistakes of Evaluators n Halo Effect n Central Tendency or Constant Error n Contrast Effect n Recent Incident Effect n Discrimination

Recommendations for Complying with EEOC Guidelines and Court Rulings: n Formalized and standard n Job related n Formal job analysis n Supervisory rating as one component n Evaluators trained

Recommendations (cont.) n Substantial daily contact n Proportions are fixed load n Independent appraisal by more than one n Administration and scoring standard

FUNDAMENTAL RULE OF PERFORMANCE APPRAISALS “judge the work, not the person” (Performance appraisals: The Latest Legal Nightmare by Alexander Hamilton Institute, 1991, p. 113)

Performance appraisals should be held a least once a year and twice a year would be better

Things that limit the frequency of performance appraisals: n Complicated programs n Supervisors that do not support performance appraisals. n Can the supervisor get help? n How many appraisals will the supervisor have to do? n How experienced is the supervisor at giving performance reviews?

Five Major Objectives of the Performance Appraisal Interview 1. Supervisor and employee should reach an agreement on the performance of the employee. 2. Strengths of employee should be identified. 3. Areas that need to be improved should be identified.

Five Objectives (cont) 4. A plan should be agreed upon to improve at least one area. 5. Supervisor and employee should agree on what is expected during the next appraisal period. (How to Improve Performance Through Appraisal and Coaching by Donald Kirkpatric)

Types of Performance Appraisal Systems * Rating Scales * Personal Comparison OR Ranking Systems * Critical Incident Technique * Behavioral Checklists and Scales * Management by Objective * 360-Degree Feedback or Multirater Assessment

RATING SCALES n In this system the employee is given a numerical rating. This rating can be given on a graphic rating scale with the supervisor simply making a mark on the scale that rates the employee.

PERSONAL COMPARISON OR RANKING SYSTEM n In this system employees are rated in comparison with each other. A number is given which supposedly indicates where each employee ranks in comparison to all the other employees.

CRITICAL INCIDENT TECHNIQUE n Employee’s performance in specific situations are evaluated and a number of these incidents are used in the overall rating of the employee.

BEHAVIORAL CHECKLISTS AND SCALES n The supervisor uses a list of descriptive statements and marks the statement that most closely describes the employee. Statements are for specifically defined aspects of a job.

MANAGEMENT BY OBJECTIVE n The employee is appraised according to how well they have reached agreed to goals. Employee and supervisor must agree on measurable objectives and how they will be met.

360-DEGREE OR MULTIRATER- REVIEW-FEEDBACK n Employees are rated by peers, team members, subordinates, and sometimes customers along with supervisors. A study by William M. Mercer reports that more than 40% of companies will use this method by the end of 1997.

A Good Performance Appraisal System is Invaluable to Both the Employee and Employer

Research A survey in 1995 revealed that 44% of 218 companies had changed their performance appraisal system in the last two years and another 29% said they will be changing theirs.

REFERENCES Alexander Hamilton Institute, (1991). Performance appraisal: The latest legal nightmare. Maywood, NJ: Modern Business Kirkpatrick, Donald L., (1982). How to improve performance through appraisal and coaching. New York: Amacom. Schellhardt, Timothy D., (1997, January 19- January 25). Everybody hates performance reviews. National Business Employment Weekly,