Performance Appraisal

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Performance Appraisal

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Performance Appraisal:

Performance Appraisal Dr. G C Mohanta, BE(Mech), MSc(Engg), MBA, PhD(Mgt) Professor Al-Qurmoshi Institute of Business Management, Hyderabad - 500005

Performance appraisal:

Performance appraisal Performance appraisal is defined as - the formal assessment and rating of an individual by his manager, usually, at an annual review meeting. Performance appraisal is the process by which a manager (i) examine and evaluates an employee’s work behaviour by comparing it with preset standards, (ii) documents the results of the comparison and (iii) uses the results to provide feedback to the employee to show where improvements are needed and why. Performance appraisals are used to determine Who needs what training and Who will be promoted, demoted, retained, or fired.

Performance Appraisal Steps :

Performance Appraisal Steps The following are the steps in Performance Appraisal: Setting Performance Standards The job requirements must be translated into levels of acceptable and unacceptable performance. Standards should be clearly identified in behavioural terms Setting Performance Objectives - The performance standards should be applied to each individual to identify specific performance goals/objectives. Defining Job Expectations It should be determined how the individual will meet these objectives in concrete behavioural terms. This provides very clear job expectations for the individual employee.

Performance Appraisal Steps (Contd.):

Performance Appraisal Steps (Contd.) Observation and Feedback Observation and feedback should be on-going throughout the appraisal period. The supervisor should let the employee know what s/he is doing right and where s/he is falling short in meeting the objectives. This allows the employee the opportunity to correct his/her actions and get back on track to meet the performance goals. Evaluation - At the end of appraisal period, supervisor must compare the performance of the employee to the standard and determine where the employee falls. Appraisal Discussion Supervisor should meet with the employee & discuss each dimension of performance in terms of whether or not the employee met the performance goals. New objectives and behavioral expectations should be set in consideration of attainments and deficiencies.

Good Practice for Performance Appraisal:

Good Practice for Performance Appraisal Good Practice for Performance Appraisal are as follows: 1. Standards for evaluation should be based on an analysis of job requirements Conduct a job analysis to ascertain specific dimensions of performance & behaviours necessary for successful job performance. Incorporate these dimensions and behaviours into the rating instrument(s). Standards for performance should be objectively stated, preferably in behavioural and/or outcome-related terms 2. Provide written instructions for implementing all phases of the system.

Good Practice for Performance Appraisal (Contd.):

Good Practice for Performance Appraisal (Contd.) 3. Train supervisors to use the rating instrument properly This involves instruction on how to apply performance standards when making judgments. The uniform application of standards is extremely important. 4. Raters should have direct knowledge of the individuals they are evaluating - When multiple sources are used, consistency across sources should be analyzed.

Good Practice for Performance Appraisal (Contd.):

Good Practice for Performance Appraisal (Contd.) 5. Performance standards be clearly communicated to employee prior to beginning of the appraisal period - Consequences of failing to meet the performance standards should be clearly communicated to the employee. 6. Feedback should be provided to employees on an on-going basis The results of annual evaluation should not be unexpected. On-going feedback provides an opportunity to the employee for immediate improvement before the annual rating. The feedback should be specific, behavioral and tied to the performance standards.

Good Practice for Performance Appraisal (Contd.):

Good Practice for Performance Appraisal (Contd.) 7. Documentation should be provided for evaluations This justification is especially important for extreme ratings Documentation should be done throughout the appraisal period. It should be specific and should be related to the performance standards. 8. Invite written comments from the employee . 9. An improvement plan with a timetable and specific benchmarks should be provided for anyone who falls below the standard - Provide some form of performance counseling or corrective guidance to assist poor performers in improving their performance.

Good Practice for Performance Appraisal (Contd.):

Good Practice for Performance Appraisal (Contd.) 10. Allow employees to review appraisal results - Require the employee to sign-off on the appraisal, indicating that they have reviewed the appraisal. 11. Formal appeal mechanisms and review of ratings by upper-level personnel is desirable. 12. The organization should document evaluations & reasons for termination decisions .

Approaches & Objectives of Appraisal:

Approaches & Objectives of Appraisal Administrative Approach First & traditional approach has been to use the evaluations to make administrative decisions about employees. Who will be promoted or who will receive salary increases. Who should be given training, Who should be warned, disciplined, or terminated. Effective reward allocation requires valid performance evaluation which differentiates employees according to a quantifiable scoring system. The evaluation instrument must be sensitive to differences in performance in order to distinguish the performers. The documentation required for such decisions must be facilitated by the performance appraisal format.

Approaches & Objectives of Appraisal (Contd.):

Approaches & Objectives of Appraisal (Contd.) Communication: Performance appraisal systems should let subordinates know where they stand, How well they are doing and what changes in their behavior are required for effective performance. Performance appraisal should provide a context to communicate: Work to be accomplished Performance expectations (goals: what, how, when) Feedback concerning current performance To provide feedback & improve performance, evaluation should be: unambiguous & clearly specify job-related performance expected use behavioral terminology set behavioral target goals for ratees to work toward these use a problem-solving focus that culminates in a specific plan for performance improvement, if needed.

Approaches & Objectives of Appraisal (Contd.):

Approaches & Objectives of Appraisal (Contd.) Developmental Approach Second approach focuses on development of employees so that they may perform their tasks more effectively. To identify strengths on which to capitalize and weaknesses as areas of improvement. It should provide a means for coaching & counseling subordinates to train & develop them to their full potential. The focus to develop employees so they can perform their tasks more effectively: (i) What the employee can do: undergo training, more effort, use different tools/methods, etc. (ii) What the organization can do: provide training, required equipment, tools, time, etc.

Developmental Approach (Contd.):

Developmental Approach (Contd.) Identification of promotional potential requires that job-related performance appraisals (PAs) have several dimensions in the incumbents job, the same or similar to the job to which the incumbent may be promoted. PA should permit comparative ranking of the ratees , measure the contribution to departmental objectives & capture the ratee's career aspirations & long-term goals.

Difference Between Administrative & Developmental Approach:

Difference Between Administrative & Developmental Approach The following are the differences in the objective of administrative and developmental approach: Administrative approach emphasize s on the authority of the superior over the subordinate and Tend to be oriented toward the measurement of past performance. Developmental approach emphasizes subordinate ’s contributions to both work and goals and focuses on how performance levels can be improved in the future.

Difference Between Administrative & Developmental Approach (Contd.):

Difference Between Administrative & Developmental Approach (C ontd .) Use of appraisals by superiors for administrative decisions may inhibit the subordinate's openness and trust in manager Which is necessary in using appraisals to aid development. Supervisors may find it necessary to separate the two approaches and Hold separate conferences: one for administrative purposes and one for developmental purposes. In this regard, appraisals are viewed primarily as mechanisms for increasing employee commitment or motivation for task accomplishment. The feedback the employee receives through the appraisal process can be helpful in more effectively directing work energies toward the goals of the organization.

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