Performance Management and Appraisal

When you finish studying this chapter, you should be able to

Explain the purpose of performance appraisal. Answer the question Who should do the appraising? Discuss the pros and cons of at least eight performance appraisal methods. Explain how to conduct an appraisal feedback interview

 Performance appraisal means evaluating an employees current and/or past performance relative to his or her performance standards

 Performance management - process through which companies insure that employees are working toward organizational goals includes practices through which the manager defines the employees goals and work, develops the employees capabilities, and evaluates and rewards the persons efforts

Defining the employees goals and work efforts

Employees efforts should be goaldirected Manager should appraise the employee based on how that person did with respect to achieving the specific standards by which he expected to be measured.

Defining the employees goals and work efforts

Manager should make sure that the employees goals and performance standards make sense in terms of the companys broader goals.

 Employees should always know ahead of time how and on what basis youre going to appraise them Should quantify your expectations Set measurable standards for each expectation.

Effective goal-setting

Setting motivational goals

Assign Specific Goals Assign Measurable Goals Assign Challenging but Doable Goals Encourage Participation

Why Appraise Performance ?

Appraisals provide important input on which promotion and salary raise decisions can be made

Why Appraise Performance ?

Lets the boss and subordinate develop a plan for correcting any deficiencies the appraisal might have unearthed, and to reinforce the things the subordinate does correctly

Why Appraise Performance ?

Can serve a useful career-planning purpose by providing the opportunity to review the employees career plans in light of his exhibited strengths and weaknesses.

Who Should Do the Appraising?

The supervisor is usually in the best position to observe and evaluate subordinates performance and is also responsible for that persons performance

Who Should Do the Appraising?

Sole reliance on supervisors ratings is not always advisable An immediate supervisor may be biased for or against the employee

Peer Appraisals has a positive

open communication task motivation social loafing

impact on improving perception of:

group viability cohesion satisfaction

Rating committee
Usually composed of the employees immediate supervisor and three or four other supervisors Can help cancel out problems such as bias on the part of individual raters.

Rating committee
It can also provide a way to include the different facets of an employees performance observed by different appraisers

Self-Ratings
Problem with self-ratings is that employees usually rate themselves higher than their supervisors or peers would rate them

Appraisal by Subordinates
Upward feedback Can help top managers diagnose management styles, identify potential people problems, and take corrective action with individual managers

360-Degree Feedback
Performance information is collected from supervisors, subordinates, peers, and internal/external customers With multiple ratees and multiple raters, can be paperwork nightmares

BASIC APPRAISAL METHODS

Graphic rating scale Alternation Ranking Method Paired Comparison Method Forced distribution method Critical Incident Method BARS Management by Objectives

Graphic rating scale

Lists a number of traits and a range of performance for each Supervisor rates each subordinate by checking the score that best describes the subordinates performance for each trait

Alternation Ranking Method

Ranking employees from best to worst on a trait Alternates between highest and lowest until all employees to be rated have been addressed

Paired Comparison Method Every subordinate to be rated is paired with and compared to every other subordinate on each trait

Forced Distribution Method Manager places predetermined percentages of subordinates in performance categories

Critical Incident Method

Keeping a record of uncommonly good or undesirable examples of an employees work-related behavior and reviewing it with the employee at predetermined times Helps ensure that the supervisor thinks about the subordinates appraisal all during the year Does not just reflect the employees most recent performance

Behaviorally Anchored Rating Scale

(BARS) is an appraisal method that combines the benefits of narrative critical incidents and quantitative ratings by anchoring a quantified scale with specific narrative examples of good and poor performance

Management by Objectives
Requires the manager to set specific measurable goals with each employee and then periodically discuss progress toward these goals

MBO
Set the organizations goals Set departmental goals Discuss departmental goals Define expected results Conduct performance reviews and measure the results Provide feedback

Web based performance management

www.knowledgepoint.com

 With electronic performance monitoring (EPM), computer network technology is used to provide managers with access to their employees computer terminals and telephones, Allows managers to determine the pace at which employees are working, their degree of accuracy, log-in and log-off times, and the amount of time spent on breaks

APPRAISAL FEEDBACK INTERVIEW

Supervisor and subordinate review the appraisal and make plans to remedy deficiencies and reinforce strengths

Preparing for the Appraisal Interview First, give the subordinate at least a weeks notice to review his or her work, and to read over his or her job description, analyze problems, and compile questions and comments.

Preparing for the Appraisal Interview

Next, study his or her job description, compare the employees performance to his or her standards, and review the files of the persons previous appraisals

Preparing for the Appraisal Interview

Finally, choose the right place for the interview and schedule enough time for it. The interview should be done in a private area

 Interviews main aim is to reinforce satisfactory performance or to diagnose and improve unsatisfactory performance Get agreement before the subordinate leaves on how things will be improved and by when

Unclear Standards

Halo Effect

Common Appraisal Problems

Bias

Central Tendency

Leniency or Strictness

Legally Defensible Appraisals

Develop appraisal criteria from documented job analyses Communicate performance standards to employees in writing Base appraisals on separate evaluations of each of the jobs performance dimensions Include an employee appeals process

Legally Defensible Appraisals

One appraiser should never have absolute authority to determine a personnel action Document all information bearing on a personnel decision in writing Train supervisors in the use of the appraisal instruments

Career Management
career - the occupational positions a person has had over many years career management - process for enabling the employees to better understand and develop their career skills and interests

Managing the Early Career Management Stages

Realistic job previews can help prospective employees more accurately gauge whether the job is for them Reality shock - phenomenon that occurs when a new employees high expectations confront the reality of an unchallenging job

Managing the Early Career Management Stages

Mentoringhaving a senior person assist and help guide the protgs career Personality problems or an unrealistically high sense of entitlement on the part of the protg (regarding access to the mentors time and advice) can adversely affect the mentor and protg

Managing the Early Career Management Stages

Career-oriented appraisals can help ensure that the persons current position makes sense in terms of the persons skills, and that the person has a sensible career path

Promotions and Transfers

Seniority versus Competence If competence is to be the basis for promotion, must decide how to measure

Retirement Trends
Employees today are choosing not to fully retire because of: Increased life expectancies Effects on many pension funds from the stock market bust of the early 2000s More firms are granting part-time employment to employees as an alternative to outright retirement

Web-based career planning

www.self-directed-search.com

Web-based career planning

www.careerdiscovery.com