1. Personal Bias (Stereotyping)
Managers allow individual differences such as gender, race or age to affect ratings they give
Effects of cultural bias, or stereotyping, can influence appraisals
Other factors – Example: mild-mannered employees may be appraised more harshly simply because they do not seriously object to results
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2. Manipulating the Evaluation
Sometimes, managers control virtually every aspect of appraisal process and are in position to manipulate system
Example: Want to give pay raise to certain employee. Supervisor may give employee a undeserved high performance evaluation
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3. Employee Anxiety
Evaluation process may create anxiety for appraised employee
Opportunities for promotion, better work assignments, and increased compensation may hinge on results
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4. Reasons for Intentionally Inflating Ratings
Believe accurate ratings would damage subordinate’s motivation and performance.
Improve employee’s eligibility for merit raises.
Avoid airing department’s “dirty laundry.”
Avoid creating negative permanent record that might haunt employee in future.
Protect good workers whose performance suffered because of personal problems.
Reward employees displaying great effort even when results were relatively low.
Avoid confrontation with hard-to-manage employees.
Promote a poor or disliked employee up and out of department.
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5. Reasons for Intentionally Lowering Ratings
Scare better performance out of employee.
Punish difficult or rebellious employee.
Encourage problem employee to quit.
Create strong record to justify planned firing.
Minimize amount of merit increase a subordinate receives.
Comply with organizational edict that discourages managers from giving high ratings.
© 2008 by Prentice Hall

6. Characteristics of Effective Appraisal System
Job-related criteria
Performance expectations
Standardization
Trained appraisers
Continuous open communication
Conduct performance reviews
Due process
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7. Job-Related Criteria
Most basic criterion needed in employee performance appraisals
Uniform Guidelines and court decisions quite clear on this point
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8. Performance Expectations
Managers and subordinates must agree on performance expectations in advance of appraisal period
If employees clearly understand expectations, they can evaluate own performance and make timely adjustments
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9. Standardization
Firms should use same evaluation instrument for all employees in same job category who work for same supervisor
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10. Trained Appraisers
Common deficiency in appraisal systems -evaluators seldom receive training on how to conduct effective evaluations
Training should be ongoing
How to rate employees and how to conduct appraisal interviews
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11. Continuous Open Communication
Employees have strong need to know how well they are performing
Good appraisal system provides highly desired feedback on continuing basis
Should be few surprises in performance review
© 2008 by Prentice Hall

12. Conduct Performance Reviews
Special time should be set for formal discussion of employee’s performance
Withholding appraisal results is absurd
Performance review allows them to detect any errors or omissions in appraisal, or employee may simply disagree with evaluation and want to challenge it
© 2008 by Prentice Hall

13. Due Process Provide employees opportunity to appeal appraisal results
Must have procedure for pursuing grievances and having them addressed objectively
© 2008 by Prentice Hall