Performance Evaluation


 What is Evaluation?
The making of a judgement about
 Amount
 Number
 Value of Something

a) Employer Prospective b) Employee Prospective

The process by which an employee’s contribution to the

organization during a specified period of time is assessed.
Evaluation Process Standards
Setting
performance
standards
Communicating
Taking corrective
standards
standards

Discussing Measuring
results standards
Comparing
standards
Performance Standards Approach
 Expected levels of performance
Benchmarks, goals, and targets

 S.M.A.R.T. approach for writing performance standards

S=Specific
M=Measurable
A=Attainable
R=Relevant
T=Time bound
Evaluation Model
Good Evaluation System
• Validity
• Reliability
• Freedom from bias: errors
• Practicality

According to Criteria According to Evaluation

Relevance of Performance Criteria

Deficiency Contamination

Performance
Criteria

Overemphasis
Relevance of Performance Evaluation

Reliability Practicality

Performance
Evaluation

Fairness
Objectives of Performance Evaluation
According to:
Employee Organization

 Concrete and tangible  Measuring the efficiency

particulars about their work  Maintaining organizational
 Assessment of performance control

Aims at:

 Personal development  Mutual goals of the employees &

 Work satisfaction the organization.
 Involvement in the organization.  Growth & development
 Increase harmony & effectiveness
PE and other HRM Functions

Training &
Development
Recruitment

P
E Compensation

Selection

Labor Relations
Why Performance Evaluation may Fail?
Mgr not taking
PE seriously Lack of
Unclear
evaluation skills
Language

Mgr not honest Mgr not

or prepared
sincere

No on-going Insuff. Rewards

feedback

Ineffective
Mgr Lacks Infor.
discussion
Sources must kept in mind for Evaluation

SUPERIOR
CUSTOMERS

TEAM
PEERS SELF

SUBORDINATES
Methods of Performance Evaluation
Traditional Methods Modern Methods

1. Paired comparison 1. Assessment Center

2. Graphic Rating scales 2. Cost Accounting method
3. Forced choice Method 3. Behaviorally Coordinate
4. Checklists method Rating scales
5. Free essay method
4. 360° Evaluation
6. Critical Incidents
5. 720° Evaluation
7. Field Review Method
8. Confidential Report
9. Ranking method
Traditional Methods


 Paired Comparison Method
• Ranking employees by making a chart of all possible pairs of the
employees for each trait and indicating which is the better Employee of
the pair.

• It is useful where priorities are not clear

• This method is not appropriate if a large number of employee are

required to be evaluated.
 Graphic or Linear Rating Scales
Attitude
0 5 10 15 20

No interest Careless: Interested in Enthusiastic Enthusiastic

In work: In-different work: Accepts about job & opinions &
consistent Instructions opinions & fellow- advice sought
complainer advice of workers by others
others

Decisiveness
0 5 10 15 20

Slow to Take decisions Takes Take decisions Take

take after careful decisions in consultation decisions
decisions consideration promptly with others without
whose views he consultation
values
Forced choice method
Criteria Rating

1.Regularity on the job Most Least

•Always regular
•Inform in advance for delay
•Never regular
•Remain absent
•Neither regular nor irregular
 Forced distribution method

No.
of
employees 10% 20% 40% 20% 10%

poor Below average good Excellent

average

Force distribution curve

 Free essay method
 The rater writes a brief essay providing an assessment of the strengths,
weaknesses and potential of the subject. In order to do so objectively, it
is necessary that the rater knows the subject well and should have
interacted with them.
• Write a Behavioral Statement
• Strengths versus Weaknesses
• Describe Selected Traits
• Evaluate Performance
Critical Incident method
Performance Subordinate Peers Superior Customer
Dimension

Leadership ^ ^

Communication ^ ^

Interpersonal skills ^ ^

Decision making ^ ^ ^

Technical skills ^ ^ ^

Motivation ^ ^ ^
Critical Incident method Example
Ex: A fire, sudden breakdown, accident
Workers Reaction scale

A Informed the supervisor immediately 5

B Become anxious on loss of output 4
C Tried to repair the machine 3
D Complained for poor maintenance 2
E Was happy to forced test 1
Confidential report

 It is mostly used in government organizations. A descriptive

report prepared by the employee’s immediate superior. The
report highlights the strengths and weaknesses of the
subordinate. The impressions of the superior about the
subordinate are merely recorded and kept confidential without
revealing the facts.
 Ranking employees by paired comparison Method

For the Trait “Quality of For the Trait “Creativity”

work”

Person rated Person rated

As compared to A B C As compared to A B C

A - + +
A + - + -
+ - + + +

B + - +
B -- ++ -- - + -

C ++ -- ++ C ++ -+ +-
Modern Methods


Assessment Center

Paper Test Method

The "Coin" Approach

Lunch Meetings
Behavioral Coordinate Rating Scales
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 & roam
around purposelessly.
Basic degree Performance Evaluation
900 0
1800
180 Appraisal 2700
360 degree performance appraisal
Degree performance appraisal
540˚:
The Stakeholders
Superiors
Subordinates
Peers
Internal And External Customers
Clients Or Suppliers
 720 Degree Performance Evaluation
• Considered an “ all-round ” evaluation, the 720 degree
performance evaluation gives an employee more than feedback
from one person.

• This evaluation gives the employee a lot of feedback generally

from anywhere from 5 to 8 people, to provide the employee with
an all round assessment of his or her on the job performance.

• 720 degree as the name suggests is 360 degree twice

• It provide for two round of feedback (a pre and post ) or a

feedback approach which is done again after nine to twelve
months.
 0
720
0
360
Customers

270 0 Other Managers

Senior Manager

0
180
Manager 0
Peers 90
Employee/Manager

Subordinates
Uses for Performance Evaluation

PE
Issues in Evaluation system
Formal and informal

What methods?
Whose performance?

When to evaluate? Evaluation

Who are the raters?
Design

What problems?
What to evaluate?

How to solve?
Advantages
Provide a record of
performance over a
period of time.

Can be motivational Provide an

with the support of a opportunity for a
good reward and manager to meet &
compensation discuss performance

Provide an opportunity Provide the

for an employee to employee with
discuss issues and to feedback about their
clarify expectations performance
Disadvantages
If not done appropriately, can
be a negative experience.

Very time consuming,

especially for a manager

Subject to rater errors &

biases.

If not done right can be a

complete waste of time.

Can be stressful for all

involved