Performance Appraisal

TERMINOLOGY

Behavior – a manner of conducting oneself

Checklist appraisals – a performance appraisal formant that requires the rater to check items most representative of the employee’s characteristics and work contributions

Comparative appraisal methods – measurement of individuals against each other, resulting in a list of individuals ranked in order of performance

Competency-based appraisal – appraisal based on knowledge, skills, and abilities

Critical incidents – reports made by knowledgeable observers of action taken by individuals who were especially effective or ineffective in accomplishing their jobs

Essay appraisal – a performance appraisal format that rates the employee’s job performance in a narrative discussion

Graphic rating scale – a format used to rate performance on a continuum of scale points

Management by objectives – a performance appraisal system that sets organizational goals and measures actual accomplishments against them

Performance appraisal – Formal, written assessment of employee work contributions and the communication that takes place with employees before, during, and after the assessment. Process by which an organization measures and evaluates an individual’s behavior and accomplishments.

Performance standards – statement of what is considered acceptable and attainable on a particular job

Traits – personal characteristics or attributes of an individual that tend to be consistent

PURPOSE OF PERFORMANCE APPRAISALS

  • Major use is for pay decisions

  • Identify candidates for promotion and reassignment

  • Determine needs for training and development

  • Give feedback for improvement

  • Administer rewards and discipline

  • Motivation tool for improved productivity

  • Goal setting for future accomplishments and measure attainment

PERFORMANCE APPRAISAL CRITERIA

  • Traits – traits such as leadership, judgment, initiative and dependability are positively correlated with job performance but may be difficult to measure

  • Behaviors – this criteria focuses on tasks to be performed but performance of expected criteria do not necessarily lead to success on the job if other criteria is not met

  • Outcomes – focuses on measurable results

TYPES OF PERFORMANCE APPRAISAL SYSTEMS

  • Rating scale – a graphic scale where the performance level is marked (ex: Poor – Average – Good – Very Good – Excellent)

  • Ranking system – compares or ranks employees with one another

  • Critical incident technique – performance during a specific incident is evaluated and multiple incident scores are compiled for the total score

  • Behavior checklists – a list of descriptive statements defining specific aspects of the job

  • Management by objective – measures goal attainment

  • 360 degree feedback – employees are rated by peers, team members, subordinates, and supervisors

MISTAKES OR COMMON RATER ERRORS

  • Recency – raters recalls recent event rather than summation of event in entire rating period

  • First impression – rater remembers only initial impression

  • Halo effect – occurs when a rater rates an employee high or low on all items because of one characteristic

  • Central tendency or constant error – reluctance of the rater to rate at either end of the spectrum but to rate the employee average or satisfactory

  • Similar-to-me effect – rating of employee with similar attributes higher that justified by performance

  • Contrast effect – rater compares an individual’s performance with others when it should be an individual performance

  • Stereotyping – a tendency to judge individuals on the basis of perceptions about the group

IMPLEMENTING PERFORMANCE APPRAISAL SYSTEMS

  • Establishing policies and procedures for consistency in rating

  • Training raters to

    • Understand the key accountabilities of their jobs

    • Establish reasonable goals and measures of performance

    • Coach subordinates

    • Adjust expectations

    • Overcome common rating errors

    • Keep consistent performance records

    • Accurately and consistently appraise performance

    • Listen effectively

    • Give timely feedback

    • Focus on observable behaviors

    • Gain employees’ agreement in meeting acceptable standards of performance

  • Testing the system on a trial group before implementing

  • Initiating the appraisal process

    • Learn the system

    • Observe and measure employee performance

  • Rating performance

  • Holding the appraisal interview

    • Prepare, prepare, prepare

    • Review files, critical incidents, prior appraisals

  • Reviewing results

    • Ratings should be reviewed at next higher level

    • Provide an appeals process

    • Monitor for patterns of discrimination

      • Adverse impact

      • Disparate treatment

WHY PERFORMANCE APPRAISALS FAIL

  • Lack of objectivity

  • Lack of job knowledge

  • Evaluating non-job related criteria

  • Unfocused criticism – comments too general

  • Lack of opportunity for feedback

  • Insufficient time spent on evaluation

  • Inconsistent standards