1. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-1 CHAPTER 8 Appraising employee performance

2. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-2 Learning Outcomes  Identify the value of the appraisal process to the organisation  Undertake employee appraisal and complete related administrative functions  Monitor and maintain staff performance to the level required by the organisation (cont.)

3. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-3 Learning Outcomes (cont.)  Arrange and conduct performance appraisal/counselling interviews  Implement appropriate grievance procedures  Implement staff termination procedures  Record appropriate details  List evaluation methods

4. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-4 Performance Appraisal Performance appraisal is a formalised and systematic assessment of an employee’s work performance, potential career development and training needs.

5. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-5 Responsibility for Performance Appraisal Human resource responsibility includes:  designing or selecting an appropriate system  developing an appropriate process  providing information and gaining management support  training supervisors to undertake the assessment  advising timing of appraisals and form distribution  ensuring review and evaluation of the process

6. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-6 The Performance Appraisal Process The performance appraisal process should provide measurable outcomes that are visible to all employees.

7. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-7 The Purpose of Performance Appraisal Appraisal is used for four strategic reasons:  learning and development  remuneration  promotion and succession planning  reducing or realigning the workforce

8. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-8 Performance Indicators Performance indicators are indicators used to measure performance against goals.

9. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-9 Work Plans Work plans are forms stating the agreed present and future work activities to be performed and the support to be provided.

10. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-10 Performance Measurement A clear set of quantifiable standards (expectations) of performance.

11. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-11 Appraisal Processes Appraisal processes can be formal or informal. The Human Resource unit designs or selects the performance appraisal system with the input, direction and support from managers, supervisors, team leaders and employees.

12. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-12 Performance goals Performance goals are outcomes required from a position, as identified in the work plan.

13. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-13 Sample Performance Appraisal Policy

14. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-14 Key Result Areas (KRAs) Key result areas are the issues and actions that must be addressed within each strategic area if specified goals are to be achieved.

15. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-15 Benefits of a Performance Appraisal System Performance appraisal has become an acceptable management practice and it is also used by organisations to improve operations and productivity.

16. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-16 Limitations of a Performance Appraisal System Some limitations of a performance appraisal system are:  The appraiser may judge the employee not the work.  The employee may not provide feedback.  Employees may be compared with peers rather than specific job-related criteria.  Supervisors may be biased.  Inappropriate criteria may be used to distort results.

17. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-17 Methods of Appraising Performance Methods of appraising performance include:  ranking  self appraisal  graphic rating  360-degree feedback  competency based (cont.)

18. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-18 Methods of Appraising Performance (cont.) Other methods also include:  manager feedback  informal feedback  upward appraisal  assessment centre  peer review  critical incident

19. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-19 Learning and Development A learning and development plan is a plan that reflects the identified learning and training needs of the employee.

20. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-20 Performance Standards A performance appraisal system seeks to improve work performance to meet organisational goals and objectives. It should be based on the principle of continuous improvement of both employee performance and the appraisal system itself.

21. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-21 Criteria for Appraising Performance The appraisal instrument should address each of the essential functions found in the job description and the outcomes desired for the period of time in question.

22. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-22 Required Appraisal Skills The appraiser needs to be trained to communicate appropriately and focus on performance not individual personality. Effective performance needs to be praised, while ineffective performance issues require delicate handling to ensure continued open communication.

23. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-23 Rating Errors in Appraisal Performance appraisal systems are devalued if rating errors or poor judgment occurs. Common judgment errors include:  leniency or strictness  central tendency in judgment  a halo or horns effect  bias based on personal issues  recency and first impressions

24. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-24 Legislative Issues The appraisal system must be developed in line with current legislation and adequate records must be kept of all appraisal and performance discussions/evaluations.

25. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-25 Gaining and Maintaining Commitment Commitment for the appraisal process needs to be obtained from both senior management and employees.

26. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-26 The Performance Appraisal Interview The purpose of this interview is to:  provide guidance to establish goals, and to recommend specific actions to be taken  provide job role clarity for employee and supervisor  provide feedback to employee and obtain feedback from employee regarding work performance and career development  problem identification and action planning

27. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-27 Performance Counselling Performance counselling involves reviewing an employee’s performance in order to discuss performance expectations and improve work performance.

28. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-28 Employee Assistance Programs An employee assistance program (EAP) is a workplace program that addresses work- related and personal issues affecting productivity and job performance.

29. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-29 Flexible Work Practices The term flexible work practices generally refers to the provision by an organisation of options that enable staff to balance their job requirements with their personal responsibilities.

30. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-30 Disciplinary Action and Termination Disciplinary action may take various forms, ranging from positive support and reinforcement to a formal process using corrective action that may lead to dismissal.

31. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-31 Evaluation of the Performance Appraisal System Evaluation can be defined as a process of determining the worth or value of something, or the outcome of a particular program. The main feature of evaluation is a judgment or decision about whether a program should be ceased, modified or continued.

32. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-32 Evaluation Methods Methods of evaluating performance appraisal include:  quantitative methods  qualitative methods  behavioural approach

33. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-33 Chapter 8 Summary  The performance appraisal process is generally instigated for an organisation as a result of the establishment of a formal performance appraisal system.  The system seeks to improve work performance to meet organisational goals and objectives. (cont.)

34. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-34 Chapter 8 Summary (cont.)  Performance appraisal is used for developing learning and development plans and remuneration packages, for promotion and succession planning, for realigning the workforce and to provide feedback to employees.  Employers need to evaluate job requirements in order to appraise performance effectively. (cont.)

35. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-35 Chapter 8 Summary (cont.)  The performance appraisal process is monitored by a human resource manager or equivalent, but is generally conducted by a line manager or team leader.  Line managers and staff need to be trained in the performance appraisal process, and their attitudes to the process should be positive in order for it to be effective. (cont.)

36. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-36 Chapter 8 Summary (cont.)  Communication channels need to be clear and unambiguous.  The appraisal system must be administered within legislative requirements, with adequate documentation.  Generally, line managers are required to maintain staff performance requirements. (cont.)

37. Copyright  2005 McGraw-Hill Australia Pty Ltd PPTs t/a Australian Human Resources Management by Jeremy Seward and Tim Dein Slides prepared by Michelle Travers 8-37 Chapter 8 Summary (cont.)  Line managers may also be required to evaluate whether appraisal processes are working.  It is important that all performance appraisal outcomes are acted upon.