INDEX

1. LEARNING OBJECTIVE
2. INTRODUCTION
3. OBJECTIVE OF PERFORMANCE APPRAISAL
4. DEVELOPING THE PERFORMANCE APPRAISAL
SYSTEM
5. INTRODUCING & OPERATION OF PERFORMANCE
APPRAISAL SYSTEM
6. MONITORING & EVALUATING PERFORMANCE
APPRAISAL
7. PROCESS OF PERFORMANC APPRAISAL
8. PERFORMANCE CRITERIA
9. BENEFITS OF PERFORMANCE APPRAISAL
10.CONSTRAINTS
11.NEW TRENDS IN PERFORMANDE APPRAISAL SYSTEM
12. 360o APRAISAL SYSTEM OR FEEDBACK
13.NEW APPRAISAL SYSTEMS
LEARNING OBJECTIVES
This lesson is an insight into the following topics related to performance appraisal:

• What is performance appraisal

• What are the objectives of performance appraisal
• What are the different types of performance appraisal

INTRODUCTION:-

Organizations are run and steered by people. It is through people that goals are
set and objectives realized. The performance of an organization is, thus, dependent
upon the sum total of the performance of its members. According to Peter Drucker, an
organization is like a tune. It is not constituted by individual sounds but by their
synthesis. The success of an organization, therefore, depends on its ability to accurately
measure the performance of its members and use it objectively to optimize them as vital
resources.

The performance of an employee is his resultant behavior on task which can be

observed and evaluated. It refers to the contribution made by an individual in the
accomplishment of organizational objectives. Performance can be measured by
combining quantity, quality, time and cost. People do not learn unless they are given
feedback on the results of their actions. For learning to take place, feedback should be
provided regularly and it should register both successes and failures. It should also
follow soon after the relevant action or actions. Performance appraisal system provides
management an opportunity to recall as well as give feedback to people. This feedback
is pertaining the performance of the worker. This helps them to correct their mistakes
and acquire new skills.

Performance appraisal (PA) refers to all those procedures that are used to
evaluate the personality, the performance and the potential of its group members.
Evaluation is different from judgment. The former is concerned with performance and
the latter is concerned with the individual. While evaluation deals with achievement of
goals, a judgment has an undercurrent of personal attack and is likely to evoke
resistance. Performance appraisal could be informal or formal. Informal performance
appraisal is a continuous process of feeding back information to the subordinates about
how well they are doing their work in the organization. The informal appraisal is
conducted on a day-today basis. For example, the manager spontaneously mentions
that a particular piece of work was well performed or poorly performed. It is due to the
close connection between the behavior and the feedback on it, the informal appraisal
quickly encourages desirable performance and discourages undesirable performance
before it becomes permanently ingrained. Therefore, informal appraisal should not be
perceived merely as a casual occurrence but as an important activity and an integral
part of the organization’s culture.
The formal performance appraisal occurs usually annually on formal basis and
involves appraise and appraiser in finding answers to the following questions:

1. What performance level has to be achieved during the period?

2. Has it been achieved?
3. What has been the shortfall and constraints?
4. What are we going to do now?
5. How will we know that we have done it?
6. What kind of feedback can be expected?
7. What assistance can be expected to improve performance?
8. What rewards and opportunities are likely to follow from the performance appraisal?

When the employees have this type of information, they are aware of the following
specifications:-

1. What the organization expects from them?

2. What assistance is available?
3. What can they expect when the required level of performance is achieved?
This increases employee acceptance of the appraisal process and results in the
trust that the employee has in the organization. An environment that affords an
opportunity for further growth while minimizing stressful situations certainly enhances
appraisal acceptance. Establishing this type of environment goes far beyond the
performance appraisal process. Every aspect of managing people and their work relates
to the improvement of their quality of work life. Performance appraisal is an integral part
of a trusting, healthy and happy work environment that goes a long way in promoting
the same.

Performance appraisal has been used for the following three purposes:

• Remedial
• Maintenance
• Development
A performance appraisal needs to cover all these three purposes with the same
focus. If any purpose predominates, the system becomes out of balance. For instance,
if remedial purpose is foremost, then the performance appraisal may become a
disciplinary tool, a form of a charge sheet and a tool of power instead of instrument of
evaluation. Sometimes maintenance becomes the main objective for an organization. In
this case, the process may become short, skimped and per functionary ritual. If there is
too much emphasis on development, then the focus falls on the future assignment
rather than on the current job.

OBJECTIVES OF PERFORMANCE APPRAISAL

Performance appraisal serves the following management objectives:

1. Providing basis for promotion/transfer/termination—

Identifying those subordinates who deserve promotion or require lateral
shift (transfer) or termination and can be used for career planning.

2. Enhancing employees’ effectiveness—

Helping employees in identifying their strengths and weaknesses. Also,
informing them about the performance expected from them. This helps them to
understand their role well and increases their efficiency at work. The feedback
reinforces good performance and discourages poor performance. This also
involves identifying employee’s training and development needs. Identifying
training and development needs of employees is necessary to prepare them for
meeting challenges in their current and future employment.

3. Aiding in designing training and development programs—

Identifying skills that need to be developed. This helps in tailor-making
training and development programs.

4. Removing work alienation—

Counseling employees corrects misconceptions which might result in
work alienation. Performance appraisal also helps employees in internalizing the
norms and values of the organization.

5. Removing discontent—
Identifying and removing factors responsible for worker’s discontent
motivates them for performing better at work. Performance appraisal helps in
creating a positive and healthy work environment in the organization.

6. Developing interpersonal relationship—

Relations between the superiors and subordinates can be improved
through realization that there exists a mutual dependence. This mutual
dependence leads to better performance and success. By facilitating employees
to do introspection, self-evaluation and goal setting, their behavior can be
modified. Better interpersonal relationships lead to team building.
.
7. Aiding wage administration—
Performance appraisal can help in development of scientific basis for
reward allocation, wage fixation, raises, incentives etc.

8. Exercising control—
Performance appraisal also provides a means for exercising control.
 9. Improving communication—
Performance appraisal serves as a mechanism for communication
between superiors and subordinates.
DEVELOPING A PERFORMANCE APPRAISAL SYSTEM

A formal performance appraisal system can provide a framework within which

appraisers and appraise can operate. A performance appraisal system can be
developed through a program comprising the following stages:-

1. Determine overall approach to performance appraisal. The decisions on the overall

approach to introduce performance appraisal should cover the following:-

(a) What are the objectives of introducing performance appraisal?

(b) What benefits are anticipated from introducing performance appraisal?
(c) What are the main features of the approach to performance appraisal?

2. Where and how should PA be introduced?

Performance appraisal is best introduced on an organization-wide basis starting at
the top. The most common and best method is to set up a project team or working
group for this purpose.

3. Decide who is to be covered?

At one time, most schemes were restricted to managers. However, performance
appraisal is now being extended to all the members of professional, administrative,
technical and support staff. The decision regarding who is to be covered should be
made at the outset itself.

4. Decide on whether the same approach should be adopted at each level. In most
cases, the essence of the approach is the same for all levels. The performance
measures vary for different levels.

5. Set up project team. Project teams consist of managers and other employees. The
human resources department or outside consultants are valuable means of getting
involvement and ownership.

6. Define role of human resource department. The role of human resource department
developing and implementing performance appraisal system is to convince top
management. They need to clarify to them that its introduction can make a significant
impact on the organizational performance.

7. Decide whether to use outside consultants. External consultants can be used for
seeking advice and introducing performance appraisal to run training programs. They
carry on evaluation studies including the conduct of attitude surveys. But as they are
costly, care should be taken in selecting consultants who have the required level of
experience and expertise.

8. Define performance management processes and documentation. The project team

needs to pay attention to each point against a background of an understanding of the
objectives to be attained and the culture and structure of the organization. Particular
attention needs to be given to the development of rating plans and document design.
When designing performance appraisal forms, the aim should be to keep them as
simple and brief as possible while allowing ample “white space” for comments. It is
desirable to issue an overall description of performance appraisal system to all
concerned which sets out its objectives and methods of operation. It also clarifies the
benefits that need to be achieved for the organization and its employees.

9. Pilot test. The whole PA system cannot be pilot tested because the cycle lasts
generally for 12 months. Performance appraisal includes drawing up performance
agreements, objective setting, document completion etc. These can pilot tested. Based
on the experience gained, the system may be fine-tuned.

10. Plan implementation program. The implementation program should cover the
following:

• Date of introducing performance appraisal in the whole or different parts of the

organization
• Procedure for evaluating the process
• Briefing or training program
INTRODUCING AND OPERATION PERFORMANCE APPRAISAL
SYSTEM

The introduction of performance appraisal should be planned during the

development stage. The main steps are to train everyone on performance appraisal,
and once in operation, to monitor and evaluate how the system is performing in
practice.

TRAINING

The importance of thorough training for both appraisers and appraise, in the skills
required to carry out performance appraisal effectively, cannot be overemphasized.
Both parties in the performance appraisal process need guidance and training in the
preparation of the following:

• Performance agreements and plans

• Conducting performance reviews
• Completing review forms
There is also a need to develop skills required to conduct appraisal discussions,
including interpersonal skills. Training can be provided by formal courses or workshops.
It is probably best to develop a series of training modules, as it might be difficult to get
people to go through all the training required at one time. It is believed that people are
unable to absorb information at one go. The modules could consist of the following:

• Introduction to performance appraisal system

• Defining key tasks and setting objectives
• Working with attributes and competence
• Preparing performance and development plans
• Conducting appraisal discussions
• Rating
• Providing feedback
• Coaching and counseling

MONITORING AND EVALUATING PERFORMANCE APPRAISAL

It is not only important to monitor the introduction of performance appraisal very

carefully, but it is equally vital to continue to monitor and evaluate it regularly. This helps
in correcting any drawbacks. The ultimate test, of course, is analyzing organizational
performance to establish the extent to which improvements can be attributed to
performance appraisal. It may be difficult to establish a direct connection. However,
more detailed assessment with managers and staff on the impact of the process may
reveal specific areas in which there have been improvements.

DISTINCTION BETWEEN PERFORMANCE AND POTENTIAL

Performance appraisal is designed to look backward in order to look forward. The

best prediction of potential, using performance appraisal as the basis, is made when the
next job is quite similar to the previous one. But, in many cases the next job may be
quite different and thus the past performance does not prove adequate as predictor of
future performance. It is important for us to clearly understand the differences between
current performance and promotion potential of subordinates. As mentioned earlier,
performance is the resultant behavior of the subordinate on the task which can be
observed or evaluated. Potential, on the other hand, refers to the ability of the
employees to fit into future role. Many managers default in assuming that a person with
abilities to perform well in one job will automatically perform well in a more responsible
position. It is for this reason that people are often promoted to positions in which they
cannot perform adequately. This has been amply summarized in Peter’s principle. The
principle indicates that in any organization, everyone rises to his/her level of
competence. We should remember that by promoting an employee with no promotion
potential, we might lose a good worker and get a bad executive.
Most performance appraisal forms have a column for potential for promotion in
which a score is required to be filled up. Though this is supported by words, only the
numerical score is recorded for manpower planning purposes. A statement such as,
ready for promotion in 10 months/years, is seen by an appraisee as a promise. There
are many methods available for identifying potential. These include assessment
centers, psychological tests, assignments, peer and self-assessment and action
learning programs. Ideally, potential assessment should involve the use of more than
one technique. This is likely to result in more reliable judgment.

PROCESS OF PERFORMANCE APPRAISAL

Performance appraisal comprises the following steps:

• Select performance factors based on the job description. These are duly evaluated
and help in setting standards for achievement
• Set the performance review period
• Measure actual performance
• Compare performance with set standards and rate it with a suitable scale
• Communicate the rating to the appraisee
• Use the performance appraisal for the desired purpose
PERFORMANCE CRITERIA

In order to be effective, the criteria for performance appraisal should be

genuinely related to success or failure in the job and should be amenable to objective
judgment. It should also be easy for the appraisers to administer and appear just and
relevant to the employees. They need to strike a fair balance between sensitivity to the
needs of the present job and applicability to the organization. The earlier concept of
merit rating has yielded place to performance appraisal. In the merit rating system, merit
was based upon personality traits such as leadership, ability to get along with others,
decisiveness, creativity, industry, judgment, initiative and drive. It is difficult to apply this
system reliably since it demands too much on the quality of personal relationships
rather than worker’s performance. Personality measurement is somewhat dangerous
because we usually like to quantify. The focus earlier was on “what” he is. In
performance appraisal, the focus is shifted to “how” he performs in work-oriented
activities such as job knowledge, accuracy, clarity, analytical mind and ability to carry on
operations to their logical ends. Performance appraisal is based on competence,
contribution and commitment. It is not based on chance, chemistry and convenience.
Merit rating was generally used for blue-collared jobs. Performance appraisal, on the
other hand, is more comprehensive and can be used for all of the following categories:

• Workers
• Supervisors
• Managers

Management by objective (MBO) is an example of performance based appraisal

approach that involves setting objectives and comparing performance against the
objectives. Objectives give greater freedom to both management and the employees in
deciding how performance is to be measured. They also have greater motivational
effect since the standards are discussed and agreed upon both by the management and
the employees.
BENEFITS OF PERFORMANCE APPRAISAL

Performance appraisal is a formal exercise carried out for all executives and staff
members with respect to their contributions made toward the growth of the organization.
The aim is to measure the overall performance of an employee over a period of time.
This is usually one year. The procedure is carried out by the immediate supervisor who
inurn provides a feedback to the employees and helps in better management.
Performance appraisal does not merely measure the performance of the people but has
many other benefits. The benefits of a successful appraisal system can be summed up
as follows:

1. Benefits for the appraisee are as follows:

• Better understanding of his/her role in the organization. Provides answers to

questions such as what is expected and what needs to be done to meet those
expectations
• Clear understanding of his/her strengths and weaknesses so as to develop into
a better performer in future
• Increased motivation, job satisfaction and self-esteem
• Opportunity to discuss work problems and how to overcome them
• Opportunity to discuss aspirations and any guidance, support or training
needed to fulfill these aspirations
• Improved working relationships with the superiors

2. Benefits for the management are as follows:

• Identification of performers and non-performers and their development toward

better performance
• Opportunity to prepare employees for assuming higher responsibilities
• Opportunity to improve communication between the employees and the
management
• Identification of training and development needs
• Generation of ideas for improvement
• Better identification of potential and formulation of career plans
3. Benefits for the organization are as follows:

• Improved performance throughout the organization

• Creation of a culture of continuous improvement and success
• Conveyance of message that people are valued

The above benefits can be realized only if performance appraisal is considered

as a process of management. It should not become a scheme devised by the personnel
department for managers to use in accordance with the directives of that department
and generate completed forms which are stored away in employee’s dossiers and then
forgotten. Performance appraisal is a process for establishing sound understanding
about what is to be achieved and an approach to manage and develop people. This
helps in increasing the probability of achieving the short-term goals and long-term goals.
Performance appraisal helps management to collect data on human resources and use
it for enhancing responsiveness of the organization. Since it is people who perform
appraisal and since people have emotions, there will always be some subjectivity.
Though criterion could be stipulated, personal likings and biases are likely to influence
the evaluation. Every assessor has a price-expectation of a particular type of behavior.

An appraisee, who meets it, gets higher assessment. Being subjective in nature,
there are certain pitfalls which need to be guarded against. The issue of performance
appraisal is very sensitive to the appraisee because it affects his/her present position
(status, and self esteem) and career growth. Performance appraisal system should not
only be fair, equitable and transparent, but it should be perceived to be so. This can
happen only if the system has in-built transparency. Some of the common pitfalls
encountered in performance appraisal are mentioned below:-

1. Shifting standards—

Performance appraisal should be based on uniform and fair standards. In

absence of this, the employees can get confused and the organization might not be able
to decide as to who is suitable for promotion. Let us consider a hypothetical situation. In
a given year, quality can be the criteria for performance evaluation. The boss can
change that in a current year and decides to judge the employees on the basis of
quantity of work.

2. Different rater’s patterns—

Managers differ in rating style. Some rate harshly whereas others are quite
lenient. This can be reduced by precise definition on the appraisal form. For instance,
dependability may be defined as the confidence you have in the employee to carry out
instructions and the extent to which you can rely on his/her ability, punctuality and
attendance. Subjectivity can also be moderated through a multi-layer appraisal system.
In this system, the immediate superior initiates the report which is reviewed by next the
higher authority.

3. Central tendency—

Many appraisal forms require the appraiser to justify outstanding or poor

assessments. Many of such raters may prefer an easier path of rating most people as
average.

4. First impression—

Some raters may form an overall impression based on some specific qualities or
features of the ratee in the first meeting itself and carry it forward. Making assessment
on too short a time span and inadequate knowledge can sometimes prove incorrect.

5. Latest behavior—

At times, the appraisal is influenced by the most recent behavior, ignoring the
most commonly engendered behavior during the entire period. Thus, a usually sober
person may be treated as arrogant because he expressed his/her opinion.

6. Halo effect—

Some raters have a tendency to rate high/low on all performance measures

based on one of their characteristics. For example, an employee who is just an average
work performer but is very good in cricket and plays Ranji trophy may be given high
overall rating. One who does not shave regularly may be assessed as lazy at workplace
also. Rating employees on each of the performance measures can reduce this.

7. Horn effect—

Highly critical bosses have a tendency to compare performance of their

subordinates with what they did. This is not correct because the performance also
depends upon the situation. For example, a salesman now operates in a buyer’s market
as against the seller’s market of yesteryears.

8. Stereotyping (Rater’s Bias)—

Some raters have a standard mental picture about a person because of that
person’s sex, color, caste, religion, age, style of-clothing, political view etc. Stereotyping
results in an oversimplified view. Such assessments are based on false
assumptions/feelings, rather than facts. Discretion should not become discrimination.

9. Spill over effect--

 This is allowing past performance to influence present evaluation. In some
organizations, when an employee reports on transfer, his earlier reports are also
transferred along. This biases the mind of the new boss.

There are other pitfalls such as taking too short appraisal interviews and failing to
support opinions with evidence, inadequate briefing of the appraisee and pre-judging
performance. In some organizations, such as PSUs, there is a system called CCR
(Character Confidential Rol1). East India Co started this system. Since it is confidential,
it can be manipulated. The corporate world soon realized its disadvantages and
introduced self-appraisal systems.

CONSTRAINTS

An interaction with over 100 managers of various backgrounds in BHEL

highlighted the following common constraints in implementing performance feedback,
as perceived by them:-

• A work culture not so conducive to proper giving and receiving of feedback

• Lack of appreciation about the philosophy and benefits of performance feedback
• Lack of willingness of superiors/top management in adopting this practice
• Fears and apprehensions about the use of performance feedback outcomes
• Confidentiality in the existing performance appraisal system
• Interference by the trade unions in case of workers
• Lack of proper system or procedure
• Lack of accountability
• Lack of clarity on role, goal, job demands etc
• No direct linkages of performance feedback system with rewards or punishment
• Lack of proper skill in performance analysis and giving feedback
• Constraint of time availability
• Personal bias and subjectivity
• Non-uniformity in the criteria of performance analysis
• Lack of trust and openness in people and conservativeness
• Heterogeneous interest
• Low motivation
• Target achievement oriented system
• Non-recognition of the effort in subordinate development

DIFFERENT TYPES OF WORK FORCE APPRAISAL SYSTEMS

Depending upon who is doing appraisal, methods of performance appraisal could

be classified into five categories:

• Rating by superiors—

In this system, supervisors appraise the performance of subordinates without

involving the latter. This method is most commonly used in government organizations.
However, it suffers from the prejudiced approach and the ability of the superiors. The
validity of the system can be improved by basing it on performance. The various
methods which are used under this system are as follows:

• Ranking method
• Paired comparison method
• Graphic rating scales method
• Forced choice list method
• Critical incidence method
• Forced distribution method

• Feedback on appraisal information—

In this system, the appraisee is informed about his/her strong and weak points.
The person is given an opportunity to defend himself/herself in terms of constraints or
weaknesses. This system leads to greater satisfaction and higher work performance
due to participative approach. Meyer suggests that the goal of the appraisal should be
to improve the future performance of subordinates and, therefore, suggested that
performance appraisal should be made a continuous process rather than a yearly
feature.

• Field review technique—

In this technique, the appraiser goes to the field (e.g. shop floor) and
obtains the information about work performance of the employee by way of
questioning the said individual, the peer group and the superiors. The information
received about how he is performing helps the appraiser in defining the profile of the
employee. Rating by self and the peer group-- In this method, the employee appraisal
is done independently at the following three levels:
 • The employee
• The peer group
• The superior
HRD department analyzes these appraisal reports and draws a profile based on
common aspects. 360o performance appraisal-- This is a new concept in performance
appraisal, where the feedback is collected from all around the employee, the superior,
the subordinates, the peer group and the customers. The evaluation is very
comprehensive in terms of the employee’s skills, abilities, styles and job-related
competencies. This system has the following advantages:

• Higher validity and reliability of the evaluation

• Self-evaluation by the employees gets compared with the perception of others
• Helps in maximizing employee potential in the face of challenges

PERFORMANCE REVIEW SEQUENCE

The following is offered as a rough guide to the sequence of events which a

manager may wish to initiate in order to ensure that nothing of importance in the
performance appraisal process has been overlooked:-

(a) Agree a time and date for the review well in advance and set aside at least an hour.
(b) Arrange for the location to be private and free from interruptions.
(c) Bring all relevant results and information concerning the appraisee’s performance in
his area of responsibility.
(d) Ask the appraisee for the following:-
• To review his/her performance in the work situation point by point
• About any problems which might have affected his/her performance
• About the implications of any problems or events and their effect on the
individual, the team and the work
• What needs to be done by either of them to help improve his/her future
Performance
(e) Decide on the key result areas.
(f) Manager and appraisee should jointly set standards of performance and the course
of action for the next review period.
(g) Close with a firm date for the next interim review.
NEW TRENDS IN PERFORMANCE APPRAISAL SYSTEM

The performance appraisal systems existing in companies in India have brought

forth many problems at all levels in the organizational structure. The findings of a survey
conducted by Business Today, in collaboration with a few organizations, revealed the
following:

• Performance appraisal systems do not appear to be connected to rewards

• Middle managers feel that they are underpaid
• Factory workers are unhappy about their pay scales, increments, flat bonuses and
unrealistic allowances.

In the emerging business environment, companies are learning a new rule for
benchmarking employee performance and deciding on the rewards. Customer
satisfaction, organizational prosperity and achieving the corporate goals should be the
ultimate arbiter to circumvent the above-mentioned problems. The appraisal and reward
systems, designed with the above framework, attract the best people, retain them and
motivate them to give their best. Translating the corporate objectives into specific,
quantifiable goals for every employee forms the corner stone of performance appraisal
systems leading to feedback on how close to or how far from those goals the employee
is at the end of appraisal period. The nature of goals emphasized by the performance
appraisal systems should not only be numbers-driven, sales or budget-oriented but also
the methods used to achieve those numbers. This shuns the employees from putting
company’s values, credibility and reputation at stake. Therefore, performance appraisal
systems should focus on behavior oriented dimensions. Performance appraisal systems
should also focus on teamwork which is increasingly gaining importance. In an age of
increased automation, employee productivity in general and managerial productivity in
particular has to be assessed and rewarded.

The potential of managers for taking on higher responsibilities, which is reflected

not just in their track record but also in their personality traits and non-function-related
abilities, have to be appraised using methods like assessment centers. And for all
these, companies have to adopt techniques like 3600 evaluations. This prevents an
employee to be assessed exclusively by his/her superiors. Linking the form of reward to
business objectives helps in yielding results. This includes achieving entrepreneurial
action from the employees. Goal-linked incentive pay and stock options, which link
compensation to profits, are good examples of this orientation. However, mature
companies focusing and managing their earnings per share and protecting market
share have to seek out managerial talent. They reward it with flexible and tax-friendly
compensation packages with benefits designed to improve the quality of life.
Companies that are delivering find the promotion route closed due to restricted number
of vertical jumps possible within the flattened hierarchy. They are required to dismantle
the promotion mindset in their employees, equate growth with lateral movement and
move toward a designation-less structure. In this case, companies have to listen to their
employees before finalizing the form of rewards. It is only then that the process of
linking pay packets to performance actually payoff. Some of the emerging techniques of
performance appraisal adopted by companies like Phillips, Reckitt and Coleman, Godrej
and Boyce, Glaxo, Cadbury India, and Mastek are enlisted below:

1. Narrative essay- A candid statement from a ratee.

2. Simple ranking- Order of rating from best to worst.
3. Alternation ranking- Alternating from top to bottom of list.
4. Paired comparison- Comparing rates to one another.
5. Forced distribution- One-to-one comparison.
6. Behavioral checklist- A descriptive rating.
7. Critical incident- Evaluation based on key incidents.
8. Graphic rating scale- Standardized, quantitative rating.
9. BARS- Rating in behavioral terms.
10. MBO- Measuring performance against results.
11. Work planning review- Emphasizes process over outcomes.
12. Immediate superiors- Feedback from immediate boss.
13. Self-appraisal- Evaluation by ratee.
14. Peer-group appraisal- Evaluation by team members.
15. Upward appraisal- Evaluation by subordinates.
16. 360-degree appraisal- Evaluation by boss peers and subordinates.
17. Assessment centers- Assessment based on response to a battery of tests.

360O APPRAISAL SYSTEM OR FEEDBACK

This is defined as the systemic collection and feedback of performance data for
an individual or a group. It is derived from a number of stakeholders in their
performance. It is done in a systematic way via questionnaires or interviews. This
formalizes judgment coming from people and through natural interactions employees
have with one another. There is both a collection and a feedback process. Data is
gathered and fed back to the individual participant in a clear way designed to promote
understanding, acceptance and ultimately changed behavior. Stakeholders are people
who are both affected by your performance and deal with you closely enough to be able
to answer specific questions about the way you interact with them. This feedback
system assesses managers in terms of the competence they possess or more
specifically through the detailed behavior that constitutes them. So far, 360o feedback
has concentrated on people who are at the more senior levels in an organization. This
includes directors, managers, senior executives in companies and partners or principals
in the profession. However, as organizations are beginning to appreciate the power and
value of such measurement, other jobholders find that their behavior also comes under
the microscope. Engineers, pilots, sales people, HR professionals, customer service
staff etc., have all participated in this assessment and feedback process. Certain
specific benefits of the 360o feedback system are as follows:

• Self development and individual counseling

• Part of organized training and development
• Team building
• Performance management
• Strategic or organizational development
• Validation of training and other initiatives
• Remuneration

The 360o feedback system can be used in any organization for the above
purposes. It is believed that the impact of this feedback on an organization is very
beneficial. The technique presents feedback in a powerful way and can have impact on
the quantity or quality of performance data, communications, staff motivation and the
roles of those involved. However, this system is not a quick process.

The 3600 feedback has become popular recently because of a change in the
expectation that organizations have from their employees. This is through the increasing
emphasis on performance measurement, change in major management concepts and
more receptive attitudes.

NEW APPRAISAL SYSTEMS

The changing needs of the organization and the existing lacunae in the
performance appraisal systems have forced the organization to design their own
appraisal system. This system fulfills the organizational as well as individual needs. In
this regard, various new concepts of appraisal system have come into vogue. They are
briefly discussed as follows:

1. Focus on achievement system—

The goal of this system is to continuously improve the performance of employees

and the organization in general. Here, each individual has primary responsibilities for
his/her performance. Therefore, the stress is primarily on development rather than
evaluation. This system is employee driven. The key role of a manager is to support
employees to maximize their potential and achievement. Hence, this system
emphasizes upon the success of the company which is enhanced through clear link
between corporate strategies and individual goals. The outcome of this achievement
system leads to visible changes in the organizational functioning and moving toward a
more optimistic climate.

2. Team appraisals—

This concept focuses upon appraising the performance of the team rather than
an individual team member. The assessment of every team member is made
accordingly. Digital Corporation USA is currently using this system. The main features
of this system are as follows:

• It involves team members in decisions affecting the team

• Individuals are involved in day-to-day activities
It includes self-appraisal, appraisal by peers and review of performance in a
group by review committee. This prevents extensively documented job description and
job requirement reports. In the organizational setting, most people are interested in
evaluating others by appraising performance. They are hardly prepared themselves to
be evaluated. Hence, it is a real challenge for HR professionals to make the appraisal
system more pragmatic to ensure that people trust in the system. So long as a human
being evaluates another, there is some subjectivity in the assessment. Thus, it is
essential to balance the subjectivity and objectivity in the appraisal system to make it
people oriented, workable and productive. Moreover, the purpose of the system should
be more developmental rather than punitive in natures
BIBLIOGRAPHY
1. www.google.com
2. www.wikipedia.com
3. www.hrfm.com