PERFORMANCE APPRAISAL

A performance appraisal (PA) or performance evaluation is a systematic

and periodic process that assesses an individual employees job performance and
productivity in relation to certain pre-established criteria and organizational
objectives. Other aspects of individual employees are considered as well, such as
organizational citizenship behavior, accomplishments, potential for future
improvement, strengths and weaknesses, etc. To collect PA data, there are three
main methods: objective production, personnel, and judgmental evaluation.
Judgmental evaluations are the most commonly used with a large variety of
evaluation methods. A PA is typically conducted annually. The interview could
function as providing feedback to employees, counseling and developing
employees, and conveying and discussing compensation, job status, or
disciplinary decisions. PA is often included in performance management
systems. Performance management systems are employed to manage and align"
all of an organization's resources in order to achieve highest possible
performance. How performance is managed in an organization determines to a
large extent the success or failure of the organization. Therefore, improving PA
for everyone should be among the highest priorities of contemporary
organizations.
DEFINITION

The process by which a manager or consultant (1)examines and evaluates

an employee's work behavior by comparing it with preset standards,
(2) documents theresults of the comparison, and (3) uses the results
toprovide feedback to the employee to show whereimprovements are needed and
why. Performance appraisals are employed to determine whoneeds what training,
and who will be promoted, demoted, retained, or fired.

CONCEPT OF PERFORMANCE APPRAISAL

Each organization concerned about the performance assessment of staff

and is done through specific methods are often based division of Supervisors in
order to identify the overall efficiency of the staff, in order to identify aspects of
the development in performance

And know the performance appraisal process "as a process aimed at

determining the performance of the worker is defined and how it should perform
its work and design plan for the development group, it would assess the
performance of not only the definition of the worker level of performance but also
influence the level of performance in the future."
And Other researchers say that the evaluation of performance "means the
assessment of the efficiency of workers for their work and their behavior in it, and
that a formal system designed to measure and evaluate the performance and
behavior of individuals at work and through constant observation and the
Organization for this performance, behavior, and results, during certain time
periods and unknown.

And definitions of the comprehensive performance assessment that "a

periodic report shows the level of individual performance and the type of behavior
compared with the tasks and duties of the job entrusted to it. It helps officials to
find out the weaknesses and strength in the activity of that individual. And the
goal is to address the weaknesses, if any, promoting aspects of the force. The
focus of this concept to the actual performance under the requirements of the job,
and standardized achievement that is expected of them performed

Performance appraisal is generally done in systematic ways which are as follows:

1. The supervisors measure the pay of employees and compare it with targets
and plans.

2. The supervisor analyses the factors behind work performances of

employees.

3. The employers are in position to guide the employees for a better

performance.
HISTORY OF THE PERFORMANCE APPRAISAL

In 1911, performance appraisal pioneer Frederick Winslow Taylor

published two books: The Principles of Scientific Management and Shop
Management. He would die a few years later, but these twin tomes stand as
testament to his pioneering work in the areas of identifying, improving and, most
crucially, modifying the flow of employee tasks and expectations.

Taylor was a big believer in the idea of that if an employee was struggling
with one set of duties, it could often serve the company better to re-assign that
employee rather than simply fire them. He also helped cement the concept of
work efficiency in the post-Victoria, industrialized factories of the world. Some of
the companies where he bore great influence were Bethlehem Steel, Cramp's
Shipbuilding, and Midvale Steel.

Long Line of Pioneers

Building upon Taylor's groundbreaking science of the workplace, many others
have since put their stamp on the performance appraisal process. Too many to
name, really. But one good example is Silicon Valley consultant Harold
Fethe.Like a number of other performance appraisal scientists, he can point to one
or more contributions that have been patented.
In Fethe's case, he came up with something called Visual 360, a computer-driven
graphical interface that allows for information to constantly be input and updated
by all those connected to a particular employee, creating an ongoing and fully
panoramic view of that employee's performance. Also known as Sum Total, the
software is a turn-key solution and a great example of how software innovation
has completely revamped the dusty old forms of Taylor's 19th century days.

Performance Appraisal Software, Appraised

Sum Total has grown to the point where it now claims that it is being used by
more than 39 million workers across 2,400 different companies. Ironically, this
performance appraisal tracking software gets regular performance appraisals of its
own, in the form of consumer magazine reviews. For its latest, 2011 editions, the
reviews have been glowing.
PURPOSE OF PERFORMANCE APPRAISAL

Performance Appraisal is being practiced in 90% of the organisations

worldwide. Self-appraisal and potential appraisal also form a part of the
performance appraisal processes.

Typically, Performance Appraisal is aimed at:

To review the performance of the employees over a given period of

time.

To judge the gap between the actual and the desired performance.

To help the management in exercising organizational control.

To diagnose the training and development needs of the future.

 Provide information to assist in the HR decisions like promotions,
transfers etc.

Provide clarity of the expectations and responsibilities of the

functions to be performed by the employees.

To judge the effectiveness of the other human resource functions of

the organization such as recruitment, selection, training and
development.

To reduce the grievances of the employees.

Helps to strengthen the relationship and communication between

superior subordinates and management employees.

According to a recent survey, the percentage of organisations (out of the

total organisations surveyed i.e. 50) using performance appraisal for the
various purposes are as shown in the diagram below:
 The most significant reasons of using Performance appraisal are:

Making payroll and compensation decisions 80%

Training and development needs 71%

Identifying the gaps in desired and actual performance and its cause
76%

Deciding future goals and course of action 42%

Promotions, demotions and transfers 49%

Other purposes 6% (including job analysis and providing superior

support, assistance and counseling)

Performance appraisal include elements as follows:

1. Career Development
This provides an opportunity for discussion of career objectives, and creation of
a strategy designed to maximize career potential.
To provide an opportunity for career counseling
To help in succession planning.
To assess training needs
To plan for career development
To assess and develop individual abilities
To provide an objective basis on which to base decisions about training and
promotion

2. Feedback
As well, feedback is encouraged in both directions: as such, employees are
encouraged to prepare ratings of their supervisors.
To provide constructive feedback to the individual regarding how their
performance is seen.
This provides a structured format for the discussion of performance issues
on a regular basis.
Feedback either reinforces performance strengths, or provides the opportunity to
discuss resolution of performance deficiencies.

3. Administrative Uses of Performance appraisal

Salary
Promotion
Retention/termination
Recognition of performance
Layoffs
Identification of poor performers
4. Performance History
This provides a performance history which is not dependent upon human
memory, and which may be useful in the full range of personnel decisions,
including compensation decision-making.
To review past and present performance, identifying strengths and weaknesses.

5. Organizational Goals
To clarify, for the individual, organizational expectations
This provides an opportunity to view ones performance in the context of
broader organizational goals.
To assess future promotion prospects and potential
To set objectives for the next period

6. Job Standards
This provides an opportunity for clearer articulation and definition of performance
expectations.

7. Documentation use of of Performance appraisal

Documentation for HR decisions
Helping to meet legal requirements
ADMINISTRATIVE PURPOSES

From the standpoint of administration, appraisal programs provide input

that can be used for the entire range of HRM activities. For example, research has
shown that performance appraisals are used most widely as a basis for
compensation decisions., The practice of pay-for-performance is found in all
types of organizations. Performance appraisal is also directly related to a number
of other major HR functions, such as promotion, transfer, and layoff decisions.
Performance appraisal data may also be used in HR planning, in determining the
relative worth of jobs under a lob evaluation program, and as criteria for
validating selection tests.

Performance appraisals also provide a paper trail for documenting

HILM actions that may result in legal action. Because of government EEO/AA
directives, employers must maintain accurate, objective records of employee
performance in order to defend themselves against possible charges of
discrimination in connection with such HRM actions as promotion, salary
determination, and termination. Finally, it is important to recognize that the
success of the entire HR program depends on knowing how the performance of
employees compares with the goals established for them. This knowledge is best
derived from a carefully planned and administered HR appraisal program.
Appraisal systems have the capability to influence employee behavior, thereby
leading directly to improved organizational performance.

The purpose of performance appraisal is many folds. However, there are

two broad purpose of performance appraisal as depicted below:

1. EVALUATION:
To let employees know where they stand relative to performance objectives and
standards. An effective entails the following:
Establishes performance standards that are measurable performance standards.
Sets mutually acceptable and measurable performance standards.
Provides continues feedback to employees about their performance.
Accurately measures performance.
Compares performance with performance standards.
Develops employees where necessary or take corrective action where
appropriate.

2. DEVELOPMENT:
Assist in training and continued personal development of people. Developed
employees are more motivated commuted and competent to achieve their work
roles and goals. They can contribute effectively in improving the organization
effectiveness.

Performance appraisal is a formal, structure system that compares employee

performance to established standards. Purpose of performance appraisal can be
broadly of two types viz; administrative purposes and developmental purpose.
 Administrative Purposes: Administrative purpose includes:
Document human resource decision with regard to performance and its
related issues. Determine promotion of employees.
Determine transfer and change in job assignments.
Identify poor performance areas of employees.
Decide on layoffs.
Meet legal requirements.
Evaluate the performance of training programmes.
Decide on salary and reward issues.
Decide retention or termination.
SELF IMPROVEMENT OF EMPLOYEES

Engage employees in the performance appraisal process

Including employee self-assessments as part of your performance management

process gives employees an active role to play. Rather than simply being the
"recipient" of feedback from their manager, the employee is given a voice, and
can inform or shape their performance appraisal and ratings. This active
participation helps them to be more engaged with both their performance and the
review process overall.

Give managers a broader perspective

Having the employee complete a self-assessment first can help give their manager
better insight into the employee's performance as well as their perceptions about
their performance. Even for managers who work closely with their employees, it's
not always possible to see the full picture and understand all the factors that affect
employee performance. Having the employee complete a self-assessment allows
the manager to view performance through their eyes and get the employee's "side
of the story". It can also help the manager understand their employee's strengths
and weaknesses from the employees perspective, as well as training
needs/desires.

Flag differences in perception before the review meeting

It's inevitable, a manager and employee will have different impressions of the
employee's performance. While one would hope that the manager would be aware
of any differences, it's often not the case. Many managers have been caught off
guard in an employee performance review meeting to discover that the employee
has a completely different perception of their performance and value, or that they
themselves are lacking vital information that affects employee ratings. An
employee self-appraisal can help identify differences in perception that might not
surface otherwise, allowing the manager to prepare appropriately for the review
meeting and ensure a fruitful discussion and fair performance ratings. In some
cases, the information revealed in the self-appraisal might even guide or redirect
the manager's assessment.

Promote more effective discussions about performance, priorities, challenges, etc.

It's human nature... When a subject is important to us, or impacts us personally,

most of us find it easier to listen to someone else once we feel we've been heard.
An employee self-assessment gives each employee that opportunity. They can
provide their evaluation of their performance along with relevant background
information first, which predisposes them to hear the feedback their manager has
to offer.

Effective management requires an ongoing, two-way discussion between a

manager and employee about performance, priorities and challenges. A
performance management program that includes employee self-appraisals,
formalizes this two-way dialogue, avoiding top down evaluations that often serve
to discourage or disengage employees. It can also help to entrench this vital two-
way dialogue in the organization's management culture.

Read how others have seen better results with employee self-evaluations

Organizations with paper-based performance management processes often shy

away from incorporating employee self-reviews in their appraisal process,
because of the additional paperwork and administration required. Automating
your process and forms with a tool like Halogen eAppraisal eliminates those
barriers.
PERFORMANCE APPRAISALS: FUNCTIONS

Got performance appraisals? Most companies do. How do you feel about your
experiences with them? What emotions do you take with you into those meetings
with your boss? What emotions do you take with you when you are the appraiser?
What emotions does each person take out of those meetings? If appraisal is the
constructive process everyone intends it to be, why do so many people leave these
encounters feeling demoralized? As one man said to me Well, Ive just come
from my annual beating.

There is growing controversy surrounding performance appraisals. Some experts,

such as management guru Peter Block, who began his career designing
performance appraisals, now believe that the process should be abolished. Other
human resource experts continue to champion appraisals. Where do you stand?
Perhaps what follows will help you sort out the arguments.

Performance appraisals are intended to fulfill six important functions:

1. Improve company performance

2. Coach and guide employees

3. Provide feedback and communication from supervisor to worker

4. Align pay with value to the organization

5. Identify the best candidates for promotion and termination

6. Provide legal documentation when termination is required

Those who would abolish performance appraisals agree that these six functions
are essential. Abolishers just dont think that performance appraisals accomplish
these functions very well. In fact, they argue that performance appraisals, while
well intended, actually damage performance, communication, and development.

Supporters of performance appraisals recognize that appraisals have their

problems. To solve those problems, new systems and new training programs are
constantly being devised. Abolishers point out that despite a century of tinkering
with the forms and training supervisors to conduct the appraisals, the process
continues to create more problems than it solves. They argue that performance
appraisals are based on faulty assumptions and cannot be fixed, i.e., it is like
driving a Model T in the Indy 500. No amount of adjustment will make it
competitive with more modern automobiles.

Here is some data to consider:

A 1997 survey by the Society for Human Resources Management found

that 90% of appraisal systems are not effective.

A leading HR firm, Development Dimensions International, found that

most employers were overwhelmingly dissatisfied with their performance
appraisal systems.
 An Industry Week survey found that only 18% felt that their performance
reviews were effective.

Performance appraisals grew to maturity during an era that favored command and
control management philosophies. Today, management thinking is changing.
Modern management theory espouses concepts such as empowerment, teamwork,
and Theory Y, i.e., that most people want to work, seek to grow, and care about
company goals. Given the fact that performance appraisals developed during a
time that encouraged command/control thinking, it is not surprising that they
would be based on similar assumptions. By their very nature, performance
appraisals perpetuate command and control thinking through their underlying
assumptions.

Here are some examples:

Performance appraisals are a forced process. Employees dont have a

choice whether or not to participate. A compulsory process assumes that
workers would not engage in growth, development, and coaching
voluntarily. When something is forced on people, they typically do not
take ownership of it, which encourages command and control
management. It becomes a vicious circle. What would happen if you made
feedback voluntary? Your answer to that question will tell you something
about what you believe about peoples motivation.

Performance appraisal systems assume that employee development and

performance is the responsibility of the organization and its managers.
Modern management thinking sees people as more mature. It believes that
individuals will take responsibility for their own behavior within cultures
that encourage it. We must take responsibility for our own behavior or all
is lost. Companies and managers are responsible for setting up conditions
within which employees can perform at their best. Whether employees do
so or not is ultimately up to them, whether we want it to be or not.
 Appraisals are done on the companys time table, annually, semi-annually,
maybe even quarterly. This system basically says: You will hear from me
when Im ready. Human beings are not so organized in their need for
feedback. What if feedback were constantly available so that people could
get it when they knew that they needed or wanted it? Under such a system,
people would take responsibility for seeking feedback (empowerment)
rather than having it delivered to them on someone elses schedule
(command and control).

Appraisals assume that most people are primarily motivated by extrinsic

factors, such as money and praise. While all of us enjoy money and praise,
it is a persons intrinsic motivation that powers outstanding performance.
Extrinsic factors can generate whatever level of performance that can be
coerced or cajoled.

Performance appraisals impose one system for coaching and learning on

all participants. They assume that everyone teaches and learns in the same
way. This is inaccurate. Different workers have different learning styles.
Different managers have different strengths in relating to their direct
reports. Defying this reality, performance appraisals inherently say: Do
this my way rather than allowing supervisors and their reports to discover
developmental methods that work best for them.
MAJOR AIM OF PERFORMANCE SYSTEM

Effective performance appraisal systems contain two basic systems operating in

conjunction: an evaluation system and a feedback system.

The main aim of the evaluation system is to identify the performance gap (if any).
This gap is the shortfall that occurs when performance does not meet the standard
set by the organization as acceptable.

The main aim of the feedback system is to inform the employee about the quality
of his or her performance. (However, the information flow is not exclusively one
way. The appraisers also receives feedback from the employee about job
problems, etc.)

One of the best ways to appreciate the purposes of performance appraisal is to

look at it from the different viewpoints of the main stakeholders: the employee
and the organization.
Employee Viewpoint

From the employee viewpoint, the purpose of performance appraisal is four-fold:

(1) Tell me what you want me to do

(2) Tell me how well I have done it

(3) Help me improve my performance

(4) Reward me for doing well.

Organizational Viewpoint

From the organization's viewpoint, one of the most important reasons for having a
system of performance appraisal is to establish and uphold the principle of
accountability.

For decades it has been known to researchers that one of the chief causes of
organizational failure is "non-alignment of responsibility and accountability."
Non-alignment occurs where employees are given responsibilities and duties, but
are not held accountable for the way in which those responsibilities and duties are
performed. What typically happens is that several individuals or work units
appear to have overlapping roles.

The overlap allows - indeed actively encourages - each individual or business unit
to "pass the buck" to the others. Ultimately, in the severely non-aligned system,
no one is accountable for anything. In this event, the principle of accountability
breaks down completely. Organizational failure is the only possible outcome.

In cases where the non-alignment is not so severe, the organization may continue
to function, albeit inefficiently. Like a poorly made or badly tuned engine, the
non-aligned organization may run, but it will be sluggish, costly and unreliable.
One of the principal aims of performance appraisal is to make people accountable.
The objective is to align responsibility and accountability at every organizational
level.

Overview

Performance evaluation is a necessary and beneficial process, which provides

annual feedback to staff members about job effectiveness and career guidance.
The performance review is intended to be a fair and balanced assessment of an
employees performance. To assist supervisors and department heads in
conducting performance reviews, the HR-Knoxville Office has introduced new
Performance Review forms and procedures for use in Knoxville.

5 Steps to a Performance Evaluation System

Keep your staff productive and motivated by conducting regular performance

evaluations.

Performance evaluations, which provide employers with an opportunity to assess

their employees contributions to the organization, are essential to developing a
powerful work team. Yet in some practices, physicians and practice managers put
performance evaluations on the back burner, often because of the time involved
and the difficulties of critiquing employees with whom they work closely. The
benefits of performance evaluations outweigh these challenges, though. When
done as part of a performance evaluation system that includes a standard
evaluation form, standard performance measures, guidelines for delivering
feedback, and disciplinary procedures, performance evaluations can enforce the
acceptable boundaries of performance, promote staff recognition and effective
communication and motivate individuals to do their best for themselves and the
practice.

The primary goals of a performance evaluation system are to provide an equitable

measurement of an employees contribution to the workforce, produce accurate
appraisal documentation to protect both the employee and employer, and obtain a
high level of quality and quantity in the work produced. To create a performance
evaluation system in your practice, follow these five steps:

1. Develop an evaluation form.

2. Identify performance measures.

3. Set guidelines for feedback.

4. Create disciplinary and termination procedures.

5. Set an evaluation schedule.

It is also advisable to run the finished system by your attorney to identify any
potential legal problems that should be fixed.

KEY POINTS
 A performance evaluation system can motivate staff to do their best for
themselves and the practice by promoting staff recognition and improving
communication.

Evaluations should be conducted fairly, consistently and objectively to

protect your employees and your practice.

An effective performance evaluation system has standardized evaluation

forms, performance measures, feedback guidelines and disciplinary
procedures.

1. Develop an evaluation form.

Performance evaluations should be conducted fairly, consistently and objectively

to protect your employees interests and to protect your practice from legal
liability. One way to ensure consistency is to use a standard evaluation form for
each evaluation. The form you use should focus only on the essential job
performance areas. Limiting these areas of focus makes the assessment more
meaningful and relevant and allows you and the employee to address the issues
that matter most. You dont need to cover every detail of an employees
performance in an evaluation.

For most staff positions, the job performance areas that should be included on a
performance evaluation form are job knowledge and skills, quality of work,
quantity of work, work habits and attitude. In each area, the appraiser should have
a range of descriptors to choose from (e.g., far below requirements, below
requirements, meets requirements, exceeds requirements, far exceeds
requirements). Depending on how specific the descriptors are, its often important
that the appraiser also have space on the form to provide the reasoning behind his
or her rating. (Click below for a one-page evaluation form that covers these
essential performance areas without overwhelming the employee or the appraiser.)
Performance evaluations for those in management positions should assess more
than just the essential job performance areas mentioned above. They should also
assess the employees people skills, ability to motivate and provide direction,
overall communication skills and ability to build teams and solve problems. You
should have either a separate evaluation form for managers or a special
managerial section added to your standard evaluation form. (Click below for an
example of a performance evaluation form that covers all the areas essential to
rating the performance of management staff.)

2. Identify performance measures.

Standard performance measures, which allow you to evaluate an employees job

performance objectively, can cut down on the amount of time and stress involved
in filling out the evaluation form. Although developing these measures can be one
of the more time-consuming parts of creating a performance evaluation system,
its also one of the most powerful.

If you have current job descriptions for each position in your practice, youve
already taken the first step toward creating standard performance measures, which
are essentially specific quantity and quality goals attached to the tasks listed in a
job description. A job description alone can serve as a measurement tool during an
evaluation if, for example, youre assessing whether an employees skills match
the requirements of the position. But standard performance measures take the job
description one step further. For example, one task listed in a receptionists job
description might be entering new and updated patient registrations into the
computer. The standard performance measure for that task might be to enter 6 to
12 registrations per day (quantity) with an error rate of less than 2 percent
(quality). (See the box on page 44 for some other standard performance measures
that were created for a receptionist in a two-physician primary care practice.)
STANDARD PERFORMANCE MEASURES: RECEPTIONIST

Quantity
Description of task (daily) Quality
Answer incoming calls 90120 Answer in fewer than three rings

Triage incoming calls 5075 Transfer to appropriate department within 45

seconds

Document phone2030 Document detailed message with an error

messages rate of less than 2%

Greet patients arriving for2030 Greet within 45 seconds of arrival by

appointments smiling and using patients name

Prepare arriving patient2030 Route existing patient charts within 3

charts and route to nurse minutes of arrival and new patient charts
within 7 minutes of arrival 90% of the time

Enter new and updated612 Enter registrations with an error rate of less
patient registrations into than 2%
computer

Standard performance measures can even objectively measure some of the more
subjective job performance areas, such as work habits. For example, you can
establish an objective measure for attendance by defining the acceptable number
of times an employee can be tardy or absent during a specific time frame.

However, standard performance measures dont always work for other subjective
areas, such as attitude. In these cases, its still important to be as objective as
possible in your evaluation. Dont attempt to describe attitude, for instance;
instead, describe the employees behavior, which is what conveys the attitude, and
the consequences of that behavior for the practice. For example: This employee
has failed to support her co-workers. When another member of her department is
absent, she refuses to take on the additional tasks required to process patients in a
timely manner. This behavior causes patient backlog, places a burden on staff and
compromises effective teamwork.

To begin developing standard performance measures in your practice, review the

job descriptions for each position and select the key components of the job that
can be specifically measured. Then, work with the employees in each position to
gather quantitative data, examine historical patterns of volume and determine
qualitative measurements that reflect the practices mission and goals. Depending
on how large your practice is and how many positions need standard performance
measures, you may want to select a committee to develop them. Then, with help
from the employees in each position, the supervisors should maintain them. Its
important to keep job descriptions and standard performance measures as current
as possible. Otherwise, when an employee doesnt measure up to the standards
youve set, you cant be sure whether he or she has a performance problem or
whether your expectations of the position have become unrealistic based on
increased volume or a change in circumstances.

REWARDING PERFORMANCE WITH PAY

If your practices pay increases are based on merit, it may be appropriate and
efficient to review an employees salary at the time of the performance evaluation.
Such a direct link between performance and pay could make you and your
employees take the performance evaluations even more seriously than you might
have otherwise. However, if your pay increases are based only partially on merit
and partially on annual changes in the Consumer Price Index, it may not be quite
as easy to review and change individual salaries at various times during the year.

Whether you plan to include a review of the employees salary during each
performance evaluation should be communicated to all employees verbally and in
writing when they are hired. It is important that employees understand this so that
their expectations are realistic and they are not disappointed.
3. Set guidelines for feedback.

Feedback is what performance evaluations are all about. So before you implement
your performance evaluation system, make sure that everyone who will be
conducting evaluations knows what kind of feedback to give, how to give it and
how to get it from the employee in return.

Give balanced feedback. Dont make the common error of glossing over an
employees deficiencies and focusing only on his or her strengths. It is by
understanding their weaknesses that employees can take ownership of their
performance and role in the practice. And when given the support they need to
make improvements in these areas, employees learn to take pride in their work
and are willing to take on new challenges with confidence.

Outline expectations for improvement. When you address areas where

improvement is needed, outline your expectations for improvement and how you
intend to help the employee meet them. For example, if an employee is speaking
harshly with other employees and does not seem tolerant with patients, give the
employee some examples of his or her behavior and offer some suggestions to
resolve the problem, such as role-playing sessions or a communication
skills/customer-service workshop or seminar. Define the boundaries by letting the
employee know what is acceptable and what will not be tolerated, and then
establish a plan for monitoring performance and re-evaluating the employee.

Encourage feedback from the employee. After youve discussed the results
of the evaluation with the employee, encourage him or her to give you some
nondefensive feedback. Ask the employee whether he or she agrees with your
assessment, and/or invite suggestions for improvement. For example: You seem
to become impatient and short with patients when the physician is running late.
Since there are times when running late cannot be avoided, how do you suggest
we handle this to avoid such a reaction? This should lead to an open exchange of
information that will allow you and the employee to better understand each
others perspective.

4. Create disciplinary and termination procedures.

In some cases, even after a thorough performance evaluation and a discussion of

expected improvements, an employee will continue to perform poorly. You need
to be prepared to handle such a situation by having well-defined, written
disciplinary and termination procedures in place. These procedures should outline
the actions that will be taken when performance deteriorates a verbal warning, a
written warning if there is no improvement or a recurrence, and termination if the
situation is not ultimately resolved.

Verbal warning. This should be given in private, with the behavior or reason for
the discipline clearly stated. For example: I observed you talking disrespectfully
to another employee at the front desk. You said she was brain-dead and tossed a
chart at her. We will not tolerate disrespect in the work-place. Furthermore, this
outburst could be overheard from the reception room. If this occurs again, a report
will be written up and placed in your file. Do you understand the importance of
this? After the verbal warning is given, allow the employee to respond, but keep
the exchange brief.

Written warning. How you handle the written warning plays a critical role in the
success of your disciplinary and termination procedures. This is the time to make
it clear to the employee just how serious his or her performance problem is.
Unfortunately, many practices fail to do this and/or to follow through with
termination if necessary. Once the written warning is mishandled in this way, it no
longer has any merit. A standard, written, warning form should include the
following:

A description of the behavior or problem that includes objective findings,

The measurable actions and changes expected of the employee,

 The support the employer will provide for improvement,

A description of what will occur (e.g., unpaid time off or termination) and
when (e.g., after one more occurrence or two) if the warning is not heeded,

The signature of the employee and appraiser and the date of the warning.

Termination. Explain the reason for the termination but do so briefly and
objectively to avoid getting into an elaborate discussion that puts you in a
defensive position. Validate the employee as a person, perhaps by giving a
positive slant to the employees potential in the job market. For example, although
an employee might have been a poor file clerk for you because he or she didnt
pay attention to detail, the employee may have a friendly personality that One of
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methodologies including initiation, planning, execution, monitoring and control
and closure. PPMO utilises these skills in successfully delivering projects and
assignments across VFS Globals business landscape. The highly skilled,
professionally qualified and experienced professionals of the PPMO team are
responsible for a wide range of activities spanning the project execution spectrum,
ranging from:

Mapping client requirements

Participating in the solution identification and elaboration, through

business process analysis

Identifying the right location to set-up a VAC that suits the applicants, the
consular post and VFS Global staff while ensuring compliance to local
laws and cultural sensitivities
 Conducting a thorough test of the application and deploying the solution at
the site

Identifying suitable vendors and solution partners to provide support to

on-going business operations

Training Operations users first time on any new solution and handholding
Operations for a limited period till cutover to regular BAU operations

Overall maintenance of quality parameters

Should make him or her a good telephone operator. Also, let the employee know
what will become of any accrued vacation or sick leave, pension benefits, etc.
Know your states laws on these issues. Finally, ask if the employee has any
further questions and then assist the employee in retrieving all of his or her
belongings and leaving with as much dignity as possible. If you handle
termination well, you are less likely to have an employee who wants to get even
by badmouthing you in the community or seeking legal revenge.

5. Set an evaluation schedule.

Once youve built your performance evaluation system the evaluation form, the
performance measures, the feedback guidelines and the disciplinary procedures
you just need to decide when to conduct the performance evaluations. Some
practices do all employee evaluations at the same time of year, while others
conduct them within 30 days of each employees anniversary of employment (the
latter may work better since it spreads the work of the evaluations out for
employer and employee). However you decide to schedule the evaluations, ensure
that each appraiser consistently meets the deadline. Ignoring employees overdue
evaluations will make them feel devalued and may hurt morale and performance.

The last analysis

A performance evaluation system should be a key component of your practice
structure. When implemented effectively, it ensures fairness and accountability,
promotes growth and development and encourages a sense of pride in your
employees contributions to the practice.
PROCESS OF PERFORMANCE APPRASIAL

ESTABLISHING PERFORMANCE STANDARDS

The first step in the process of performance appraisal is the setting up of the
standards which will be used to as the base to compare the actual performance of
the employees. This step requires setting the criteria to judge the performance of
the employees as successful or unsuccessful and the degrees of their contribution
to the organizational goals and objectives. The standards set should be clear,
easily understandable and in measurable terms.

In case the performance of the employee cannot be measured, great care

should be taken to describe the standards.

COMMUNICATING THE STANDARDS

Once set, it is the responsibility of the management to communicate the
standards to all the employees of the organization.

The employees should be informed and the standards should be clearly

explained to the. This will help them to understand their roles and to know
what exactly is expected from them. The standards should also be
communicated to the appraisers or the evaluators and if required, the
standards can also be modified at this stage itself according to the relevant
feedback from the employees or the evaluators.

MEASURING THE ACTUAL PERFORMANCE

The most difficult part of the Performance appraisal process is measuring the
actual performance of the employees that is the work done by the employees
during the specified period of time. It is a continuous process which involves
monitoring the performance throughout the year. This stage requires the careful
selection of the appropriate techniques of measurement, taking care that personal
bias does not affect the outcome of the process and providing assistance rather
than interfering in an employees work.

COMPARING THE ACTUAL WITH THE DESIRED

PERFORMANCE
The actual performance is compared with the desired or the standard performance.
The comparison tells the deviations in the performance of the employees from the
standards set. The result can show the actual performance being more than the
desired performance or, the actual performance being less than the desired
performance depicting a negative deviation in the organizational performance. It
includes recalling, evaluating and analysis of data related to the employees
performance.
DISCUSSING RESULTS
The result of the appraisal is communicated and discussed with the employees on
one-to-one basis. The focus of this discussion is on communication and listening.
The results, the problems and the possible solutions are discussed with the aim of
problem solving and reaching consensus. The feedback should be given with a
positive attitude as this can have an effect on the employees future performance.
The purpose of the meeting should be to solve the problems faced and motivate
the employees to perform better.

DECISION MAKING
The last step of the process is to take decisions which can be taken either to
improve the performance of the employees, take the required corrective actions,
or the related HR decisions
TRADITIONAL METHODS OF PERFORMANCE
APPRAISAL

1. Rating Scales Method

creating Scales Method is commonly used method for assessing the performance
of the employees and well-known traditional method of performance appraisal of
employees. Many corporations and companies example in the country India,
telecommunications company likelyairtel and US IT companies
like Dell Corporation are using this method for evaluating the employees and
subsequently take decisions on concerned employee.

Depending upon the job of employee under this method of appraisal traits like
attitude, performance, regularity, accountability and sincerity etc,are rated with
scale from 1 to 10. 1 indicates negative feedback and 10 indicates positive
feedback as shown below.

Attitude of employee towards his superiors, colleagues and customers

1 2 3 4 5 6 7 8 9 10
Extremely Excellent poor

Regularity in the job

1 2 3 4 5 6 7 8 9 10
Extremely outstanding poor

Under this method of performance appraisal, employee may be assessed by his

superiors, colleagues, subordinates or sometimes by his customers which all
depends on nature of the company or job which is added where the employee.
Appraiser is a person who appraises employee will give rating for every trait
given by marking or choosing number basing on his observation and satisfaction.
ultimately all numbers chosen or marked will be added to determine highest score
gained by employee. Employee who scored more points will be treated as top
performer following descending scored employees will be treated as low
performer and the least scored employee will be treated as non-performers.

2. Essay Appraisal Method

This traditional form of appraisal, also known as Free Form method

involves a description of the performance of an employee by his superior. The
description is an evaluation of the performance of any individual based on the
facts and often includes examples and evidences to support the information. A
major drawback of the method is the inseparability of the bias of the evaluator.

Under this method, the rater is asked to express the strong as well as weak points
of the employees behavior. This technique is normally used with a combination
of the graphic rating scale because the rater can elaborately present the scale by
substantiating an explanation for his rating. While preparing the essay on the
employee, the rater considers the following factors:

Job knowledge and potential of the employee;

Employees understanding of the companys programmes, policies,

objectives, etc.;

The employees relations with co-workers and superiors;

The employees general planning, organizing and controlling ability;

The attitudes and perceptions of the employee, in general.

Essay evaluation is a non-quantitative technique. This method is advantageous in
at least one sense, i.e., the essay provides a good deal of information about the
employee and also reveals more about the evaluator. The essay evaluation method
however, suffers from the following limitations:

It is highly subjective; the supervisor may write a biased essay. The

employees who are sycophants will be evaluated more favorably then
other employees.

Some evaluators may be poor in writing essays on employee performance.

Others may be superficial in explanation and use flowery language which
may not reflect the actual performance of the employee. It is very difficult
to find effective writers nowadays.

The appraiser is required to find time to prepare the essay. A busy

appraiser may write the essay hurriedly without properly assessing the
actual performance of the worker. On the other hand, appraiser takes a
long time, this becomes uneconomical from the view point of the firm,
because the time of the evaluator (supervisor) is costly.

3. Ranking Method
How do we use the ranking method? Under the ranking method, the
manager com-pares an employee to other similar employees, rather than to a
standard measurement. An offshoot of ranking is the forced distribution method,
which is similar to grading on a curve. Predetermined percentages of employees
are placed in various performance categories, for example, excellent,above
average, average, below average, and poor,. The employees ranked in the top
group usually get the rewards (raise, bonus, promotion), those not at the top tend
to have the reward withheld, and those at the bottom sometimes get punished. In
Self-Assessment and Skill Builder 8-1, you are asked to rank the performance of
your peers.
Why and when do we use the ranking method? Managers have to make evaluative
decisions, such as who is the employee of the month, who gets a raise or
promotion, and who gets laid off. So when we have to make evaluative decisions,
we generally have to use ranking. However, our ranking can, and when possible
should, be based on other methods and forms. Ranking can also be used for
developmental purposes by letting employees know where they stand in
comparison to their peersthey can be motivated to improve performance. For
example, when one of the authors passes back exams, he places the grade
distribution on the board. It does not in any way affect the current gradesbut it
lets students know where they stand, and he does it to motivate improvement.

4. Paired Comparison
A better technique of comparison than the straight ranking method, this
method compares each employee with all others in the group, one at a time. After
all the comparisons on the basis of the overall comparisons, the employees are
given the final rankings.

5. Critical Incidents Methods

This technique of performance appraisal was developed by Flanagan and
Burns.The manager prepares lists of statements of very effective and ineffective
behavior of an employee. These critical incidents or events represent the
outstanding or poor behavior of employees on the job. The manager maintains
logs on each employee, whereby he periodically records critical incidents of the
workers behavior. At the end of the rating period, these recorded critical incidents
are used in the evaluation of the workers performance. An example of a good
critical incident of a sales assistant is the following:

July 20 The sales clerk patiently attended to the customers complaint. He is

polite, prompt, enthusiastic in solving the customers problem.
On the other hand the bad critical incident may appear as under:
July 20 The sales assistant stayed 45 minutes over on his break during the
busiest part of the day. He failed to answer the store managers call thrice. He is
lazy, negligent, stubborn and uninterested in work.

This method provides an objective basis for conducting a thorough discussion of

an employees performance. This method avoids recency bias (most recent
incidents get too much emphasis). This method suffers however from the
following limitations:
Negative incidents may be more noticeable than positive incidents.
The supervisors have a tendency to unload a series of complaints about
incidents during an annual performance review session.
It results in very close supervision which may not be liked by the
employee.
The recording of incidents may be a chore for the manager concerned,
who may be too busy or forget to do it.

6. Confidential Report System

Confidential report system is well known method of performance

appraisal system mostly being used by the the Government organisations. In this
method of appraising system, subordinate is observed by his superiors regarding
his performance in the job and on his duties done. Thereafter Superior writes
confidential report on his performance, mainly on his behaviour in the
organisation and conduct and remarks if any. confidential reports will be kept
confidential and will not be revealed to anyone and finally confidential reports
will be forwarded to the top management officials for taking decision against
person on whom confidential report has made. Confidential reports are the main
criteria for promoting or transferring of any employee mainly in the government
sector. All governmental organisations example judiciary, police Department and
other government departments in the India are using confidential reports method
as a tool to know about the employee and to take any decision connecting to him.

Confidential reports consist of following key issues.

His/Her service matters pertaining to job.

His/Her overall performance in the Job.

His/Her responsibility and accountability to the Job.

His/Her achievements in the Job.

His/Her discipline, conduct and behaviour in the Job.

Disciplinary action taken against employee.

Complaints received against him/her in the job.

His/Her attitude and behaviour with others.

Recommendations against him/her.

7. Checklist Method
The rater is given a checklist of the descriptions of the behaviour of the
employees on job. The checklist contains a list of statements on the basis of which
the rater describes the on the job performance of the employees.
Another simple type of individual evaluation method is the checklist. A checklist
represents, in its simplest form, a set of objectives or descriptive statements about
the employee and his behavior. If the rater believes strongly that the employee
possesses a particular listed trait, he checks the item; otherwise, he leaves the item
blank. A more recent variation of the checklist method is the weighted list. Under
this, the value of each question may be weighted equally or certain questions may
be weighted more heavily than others. The following are some of the sample
questions in the checklist.
Is the employee really interested in the task assigned? Yes/No
Is he respected by his colleagues (co-workers) Yes/No
Does he give respect to his superiors? Yes/No
Does he follow instructions properly? Yes/No
Does he make mistakes frequently? Yes/No
8. Graphic Rating Scale

Example of Graphic Rating Scales Method

Performance Trait Excellent Good Average Fair Poor

Attitude 5 4 3 2 1
Knowledge of Work 5 4 3 2 1
Managerial Skills 5 4 3 2 1
Team Work 5 4 3 2 1
Honesty 5 4 3 2 1
Regularity 5 4 3 2 1
Accountability 5 4 3 2 1
Interpersonal 5 4 3 2 1
relationships
Creativity 5 4 3 2 1
Discipline 5 4 3 2 1

This is the very popular, traditional method of performance appraisal. Under this
method, core traits of employee pertaining to his job are carefully defined like
Attitude, Knowledge of Work, Managerial Skills, Team Work, Honesty,
Regularity, Accountability, Interpersonal relationships, Creativity and Discipline
etc. Theses traits are allotted with with numerical scale to tabulate the scores
gained by appraisee (employee) in performance assessment relating to his job by
appraiser (employer) and sum-up to determine the best performer. Appraiser
ticks rating of particular trait depending upon his endeavor in his job. Score vary
form employee to employee depending up on his performance levels and
endeavor in his job.

This method is popular because it is simple and does not require any writing
ability. The method is easy to understand and use. Comparison among pairs is
possible. This is necessary for decision on salary increases, promotion, etc.
Companies like DELL, Maruthi Suzuki India Ltd and airtel are using this graphic
rating scale method to appraise performance of their employees in there jobs and
to take decisions regarding the matters concerned to employees

9. Forced Distribution
A rating system used by companies to evaluate their employees. The
system requires the managers to evaluate each individual, and rank them typically
into one of three categories (excellent, good, poor). The system is thought to be
relatively widely-used, but remains somewhat controversial due to the
competition it creates, and also the reality that not all employees will fit neatly
into one of the categories and might end up in a category that does not reflect their
true performance. One of the first companies to use this system was General
Electric, in the 1980s.
Forced ranking is a method of performance appraisal to rank employee but in
order of forced distribution.

For example, the distribution requested with 10 or 20 percent in the top category,
70 or 80 percent in the middle, and 10 percent in the bottom.

The top-ranked employees are considered high-potential employees and are

often targeted for a more rapid career and leadership development programs.

In contrast, those ranked at the bottom are denied bonuses and pay increases.
They may be given a probationary period to improve their performance.
MODERN METHODS OF PERFORMANCE
APPRASIAL

Assessment Centres
An assessment center typically involves the use of methods like social/informal
events, tests and exercises, assignments being given to a group of employees to
assess their competencies to take higher responsibilities in the future. Generally,
employees are given an assignment similar to the job they would be expected to
perform if promoted. The trained evaluators observe and evaluate employees as
they perform the assigned jobs and are evaluated on job related characteristics.

The major competencies that are judged in assessment centers are interpersonal
skills, intellectual capability, planning and organizing capabilities, motivation,
career orientation etc. assessment centers are also an effective way to determine
the training and development needs of the targeted employees.

Nearly 30% companies seek assessment center services while moving an

employee from executive position to managerial position. 20% companies said
they use the center's services when seeking a position on senior management
level.

As per the TJinsite, the premium research website promoted by TimesJobs.com

survey, more than 80% of the surveyed employers predict an increased use of
assessment centres in near future because of their expertise and unbiased in
assessing an individual fit and biggest limitation comes from the lack of skilled
assessors to perform the assessment task effectively.

Facts [+]
AssessPeople Ltd. is a workforce assessment company, based at Chennai, India,
and having wings at all metros across country. They are a pioneer in India to use
internet as a platform to design, administer, and provide the results to
organizations.

What they do?

Pioneer in workforce assessment services since 1999

Assessment services for

o High School Students to Senior Managers

o Individual and team assessments

Assessment of aptitudes, abilities, skills, behaviours, competencies,

knowledge, morale, attitude and work values

Multilingual Assessments

Biometrics, Photo, Phone2web

End2End Assessments

Organisation-wide Surveys

Behaviorally Anchored Rating Scales

Behaviorally Anchored Rating Scales (BARS) is a relatively new
technique which combines the graphic rating scale and critical incidents method.
It consists of predetermined critical areas of job performance or sets of behavioral
statements describing important job performance qualities as good or bad (for eg.
the qualities like inter-personal relationships, adaptability and reliability, job
knowledge etc). These statements are developed from critical incidents.
In this method, an employees actual job behaviour is judged against the desired
behaviour by recording and comparing the behaviour with BARS. Developing
and practicing BARS requires expert knowledge.

A behaviorally anchored rating scale is an employee appraisal system where raters

distinguish between successful and unsuccessful job performance by collecting
and listing critical job factors. These critical behaviors are categorized and
appointed a numerical value which is used as the basis for rating performance.
An Example of Behaviorally Anchored Rating Scale (BARS)
Performance Points Behavior
Extremely good 7 Can expect trainee to make valuable suggestions for
increased sales and to have positive relationships
with customers all over the country.
Good 6 Can expect to initiate creative ideas for improved
sales.
Above average 5 Can expect to keep in touch with the customers
throughout the year.
Average 4 Can manage, with difficulty, to deliver the goods in
time.
Below average 3 Can expect to unload the trucks when asked by the
supervisor.
Poor 2 Can expect to inform only a part of the customers.
Extremely poor 1 Can expect to take extended coffee breaks and roam
around purposelessly.

Human Resource Accounting Method

Human Resource Accounting is a method to measure the effectiveness of

personnel management activities and the use of people in an organization.HRA is
the process of Assigning, budgeting, and reporting the cost of human resources
incurred in an organization, including wages and salaries and training expenses.
Human resources are valuable assets for every organization. Human resource
accounting method tries to find the relative worth of these assets in the terms of
money. In this method the Performance appraisal of the employees is judged in
terms of cost and contribution of the employees. The cost of employees include
all the expenses incurred on them like their compensation, recruitment and
selection costs, induction and training costs etc whereas their contribution
includes the total value added (in monetary terms). The difference between the
cost and the contribution will be the performance of the employees. Ideally, the
contribution of the employees should be greater than the cost incurred on them.

Management By Objectives
The definition of MBO, as expressed by its foremost proponent, Dr. George S.
Odiorne,

Management by objectives is a process whereby the superior and

subordinate managers of an organisation jointly identify its common goals,
define each individuals major areas of responsibility in terms of the results
expected of him, and use these measures as guides for operating the unit and
assessing the contribution of each of its members.

Much of the initial impetus for MBO was provided by Peter Drucker (1954) and
by Douglas McGregor (1960). Drucker first described management by objectives
in 1954 in the Practice of Management. Drucker pointed the importance of
managers having clear objectives that support the purposes of those in higher
positions in the organisation. McGregor argues that by establishing performance
goals for employees after reaching agreement with superiors, the problems of
appraisal of performance are minimised. MBO in essence involves the setting out
clearly defined goals of an employee in agreement with his superior. Carroll and
Tosi (1973), in an extensive account of MBO, note its following characteristics:
 1. The establishment of organisational goals.

2. The setting of individual objectives in relation to organisational goals.

3. A periodic review of performance as it relates to organisational goals.

Effective goal-setting and planning by top management.

4. Organisational commitment.

5. Mutual goal-setting.

6. Frequent individual performance reviews.

7. Some freedom in developing means of achieving objectives.

MBO is, thus, a method of mutual goal-setting, measuring progress towards the
goals, taking action to assure goal attainment, feedback, and participation. It is a
resultoriented philosophy, enabling an employee to measure progress toward a
goal which the employee often has helped to set. In the goal-setting phase of
MBO, a superior and subordinate discuss job performance problems and a goal is
agreed upon. Along with mutual goal-setting, a major component of MBO is the
performance review session between the superior and subordinate, which takes
place regularly to evaluate progress towards specified goals.

The key features of management by objectives are as under:

1. Superior and subordinate get together and jointly agree upon .the list the
principal duties and areas of responsibility of .the individuals job.

2. The subordinate sets his own short-term performance goals or .targets in

cooperation with his superior.
 3. They agree upon criteria for measuring and evaluating .performance.

4. From time to time, as decided upon, the superior and .subordinate get
together to evaluate progress towards the .agreed-upon goals. At those
meetings, new or modified goals .are set for the ensuing period.

5. The superior plays a supportive role. He tries, on a day-to-.day basis, to

help the subordinate achieve the agreed upon .goals. He counsels and
coaches.

6. In the appraisal process, the superior plays less of the .role of a judge and
more of the role of one who helps the .subordinate attain the organisation
goals or targets.

The MBO process

 MBO as a mutual goal setting exercise is most appropriate for technical,
professional, supervisory, and executive personnel. In these positions, there is
generally enough latitude and room for discretion to make it possible for the
person to participate in setting his work goals, tackle new projects, and discover
new ways to solve problems. This method is generally not applied for lower
categories of workers because their jobs are usually too restricted in scope. There
is little discretionary opportunity for them to shape their jobs.

MBO may be viewed as a system of management rather than an appraisal

method. A successful installation of MBO requires written mission statements that
are prepared at the highest levels of top management. Mission statements provide
the coherence in which top-down and bottom-up goal setting appear sensible and
compatible. MBO can be applied successfully to an organisation that has
sufficient autonomy, personnel, budget allocation, and policy integrity. Managers
are expected to perform so that goals are attained by the organisation. Too often
MBO is installed top-down in a dictatorial manner with a little or no
accompanying training. If properly implemented, it serves as a powerful and
useful tool for the success of managerial performance.

MBO is a tool that is inextricably connected with team building so that the work
commitment of team members can be increased and their desire to excel in
performance can be inspired. It is important to have effective team work among a
group of managers or a group of subordinates. The group of employees or
subordinates must be looked upon as a team that needs to be brought together.
Goals should be set by manager-subordinate pairs, and also by teams. The basic
superior subordinate relationship in an organisation is in no way undermined in
this concept of team goal setting. Lines of responsibility, authority, and
accountability remain clear.
STAGES IN PERFORMANCE APPRAISAL PROCESS

The performance appraisal process is one that few look forward to. However,
understanding the process can help managers and employees conduct a more
fruitful appraisal. At the University of Texas at Dallas, managers are taught that
"A chief purpose of any performance appraisal program is employee
development. This goal is accomplished by helping the employee to do a better
job and by developing in the employee the knowledge and skill to meet the future
needs of the work unit and the institution."

Establish a File

For managers to be effective and help employees develop skills and capabilities,
it’s essential to begin the performance management process on the
employee's first day. Create a file for each employee and record the
accomplishments, areas for improvement and regular feedback throughout the
year.
Provide Regular Feedback

Regular feedback should occur at least once each quarter and more frequently if
an employee needs encouragement or motivation. According to the American
Society for Clinical Laboratory Science, & amp;ldquo; The performance
management process starts with employee planning and ends with an evaluation
of employee progress. Managers and employees should meet to discuss planning
and goals throughout the year. If possible, formally sitting down with your
supervisor or manager on a quarterly basis is optimal. The process, at its best, is a
collaborative one which should add value for both the employee and the
employer. & amp;rdquo; Employees thrive on feedback because it ensures they
are performing job duties and responsibilities according to the company
’s expectations. The feedback can be given in a casual manner,
provided the topic of the feedback is suitable for a casual meeting. Always
document any feedback you provide to employees, even if it & amp;rsquo;s just
to say & amp;ldquo;great job.”

Discipline Issues

Throughout the year, an employee may engage in behavior that warrants

disciplinary action. Your company & amp;rsquo;s procedure for addressing
discipline should include a requirement to document every disciplinary action
taken. All disciplinary issues and improvements are taken into account during the
annual performance appraisal meeting.

Management by Objectives

Management by objectives, or MBOs, is another step in the performance appraisal

process used for some employees who have defined goals and steps to achieve
each goal. These MBOs really should be reviewed quarterly to track progress or
redefine the goal if neither of you see enough progress. MBOs are also
particularly helpful to employees who are on a professional career track within
your business.

Conduct the Appraisal Meeting

As the time nears for scheduling the appraisal meeting, begin preparing the
performance appraisal document. Many companies have lengthy forms that
require managers to record relatively detailed information about the employee &
amp;rsquo;s performance in all areas of the job. Performance is rated in areas
such as job proficiency, interpersonal relationships, communication skills and
aptitude. Some employers consider employee self-evaluations. In these cases, the
employee should prepare her comments about her performance during the past
year. Both the manager and the employee should feel comfortable during the
appraisal meeting. Tension will just make the meeting agenda much more difficult
and uncomfortable than it needs to be.

Follow Up Action

After the performance appraisal meeting, there will likely be follow up matters
such as discussing areas for improvement, establishing goals for the next year and
confirming the employee's salary or wage increase. In addition, the
manager and employee may schedule another time to discuss unresolvable issues
that arise during the performance appraisal meeting.

OBJECTIVES OF PERFORMANCE APPRAISAL

Performance Appraisal can be done with following objectives in mind:

 1. To maintain records in order to determine compensation packages, wage
structure, salaries raises, etc.

2. To identify the strengths and weaknesses of employees to place right men

on right job.

3. To maintain and assess the potential present in a person for further growth
and development.

4. To provide a feedback to employees regarding their performance and

related status.

5. To provide a feedback to employees regarding their performance and

related status.

6. It serves as a basis for influencing working habits of the employees.

7. To review and retain the promotional and other training programmes.

ADVANTAGES OF PERFORMANCE APPRAISAL

It is said that performance appraisal is an investment for the company which can
be justified by following advantages:

1. Promotion: Performance Appraisal helps the supervisors to chalk out the

promotion programmes for efficient employees. In this regards, inefficient
workers can be dismissed or demoted in case.

2. Compensation: Performance Appraisal helps in chalking out

compensation packages for employees. Merit rating is possible through
performance appraisal. Performance Appraisal tries to give worth to a
performance. Compensation packages which includes bonus, high salary
rates, extra benefits, allowances and pre-requisites are dependent on
 performance appraisal. The criteria should be merit rather than seniority.

3. Employees Development: The systematic procedure of performance

appraisal helps the supervisors to frame training policies and
programmes. It helps to analyse strengths and weaknesses of employees
so that new jobs can be designed for efficient employees. It also helps in
framing future development programmes.

4. Selection Validation: Performance Appraisal helps the supervisors to

understand the validity and importance of the selection procedure. The
supervisors come to know the validity and thereby the strengths and
weaknesses of selection procedure. Future changes in selection methods
can be made in this regard.

5. Communication: For an organization, effective communication between

employees and employers is very important. Through performance
appraisal, communication can be sought for in the following ways:

a. Through performance appraisal, the employers can understand and

accept skills of subordinates.

b. The subordinates can also understand and create a trust and

confidence in superiors.

c. It also helps in maintaining cordial and congenial labour

management relationship.

d. It develops the spirit of work and boosts the morale of employees.

All the above factors ensure effective communication.

6. Motivation: Performance appraisal serves as a motivation tool. Through

evaluating performance of employees, a persons efficiency can be
 determined if the targets are achieved. This very well motivates a person
for better job and helps him to improve his performance in the future.

BENEFITS OF PERFORMANCE APPRAISAL

If appraisal is to be effective, staff must see the process attempting to meet

their needs, otherwise the system will not work. This means Heads of Department
do need to form an overview of the issues raised by their staff and if appropriate
feed these into the planning process. Appraisal should result in: Benefits for the
individual: Gaining a better understanding of their role Understanding more
clearly how and where they fit in within the wider picture A better understanding
of how performance is assessed and monitored Getting an insight into how their
performance is perceived Improving understanding of their strengths and
weaknesses and developmental needs Identifying ways in which they can
improve performance Providing an opportunity to discuss and clarify
developmental and training needs Understanding and agreeing their objectives
for the next year. An opportunity to discuss career direction and prospects.

Benefits to the line manager/supervisor/team leader: Opportunities to

hear and exchange views and opinions away from the normal pressure of work
An opportunity to identify any potential difficulties or weaknesses An improved
understanding of the resources available An opportunity to plan for and set
objectives for the next period An opportunity to think about and clarify their own
role An opportunity to plan for achieving improved performance An opportunity
to plan for further delegation and coaching An opportunity to motivate members
of the team.

Benefits to the organisation: A structured means of identifying and assessing

potential Up-to-date information regarding the expectations and aspirations of
employees Information on which to base decisions about promotions and
motivation An opportunity to review succession planning Information about
training needs which can act as a basis for developing training plans Updating of
employee records (achievements, new competencies etc) Career counselling
Communication of information

DISADVANTAGES OF PERFORMANCE APPRAISAL

Performance appraisals are usually part of a yearly review process in

which a supervisor reviews the job performance, goal completion and projects
accomplished by an employee. While the structure of performance appraisals
offers a way for giving constructive feedback to employees, which in turn can be
used as a reward or a motivational tool, there are downsides to traditional
performance appraisals.

One Sided Input

Traditional performance appraisals involve a supervisor and supervisee, both of
which have limited perspectives. As with any situation, limited perspectives lead
to a limited amount of information by which to judge performance. If a manager
is busy supervising several people, as well as tasks and other projects, then there
will be limited time to take in the full scope and practice of the performance of the
supervisee. As an alternative, many industries today are utilizing 360-degree
feedback, which takes into account the relationships that an employee has with
peers, customers, clients, supervisors and those whom the supervisee is
responsible for overseeing.

Forms Only Give Quantitative or Qualitative Data

Many times, feedback forms that are utilized in performance appraisals only use
quantitative or qualitative measures, but not both. Quantitative appraisals mainly
measure numbers, such as how many projects, how many were on time. While
this is important, there are other things to take into consideration. Qualitative
benchmarks involve the completion of personal or professional goals and the
stories of how the supervisee utilized opportunities to lead by example and
proactively implement the values and mission of the organization. Listening to the
stories of what has happened over the past year and looking at numbers and
outcomes will result in a clearer picture of what the value of the employee is to
the organization.

Once-a-Year Raises
Performance appraisals are usually done once a year and are connected to an
increase in salary. This is a disadvantage in that supervisees generally live in fear
and experience anxiety when their review time comes up. Having more consistent
interaction when it comes to feedback between management and supervisees can
help reduce the fear, anxiety and wondering about a raise. Furthermore, the
employee naturally will want to bargain for more money focusing on their
strengths and the management will want to emphasize the constructive areas
of performance evaluation in order to keep from giving raises, since money is a
limited resource in any organization. This adds to the stress of the review