CHAPTER 10
Evaluating Employee
Performance
DeCenzo and Robbins HRM 7th
Edition
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CHAPTER 10 TOPICS:
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Performance management system purpose
Appraisal process steps
Absolute standards
Relative standards
MBO
Performance appraisal distortions
More effective performance appraisal
Alternative appraisal methods
Global issues
DeCenzo and Robbins HRM 7th
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1: PERFORMANCE
EVALUATION PURPOSES
Performance
Management Systems
Feedback
Development
Documentation
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1: PERFORMANCE
EVALUATION PROBLEMS
Focus on individual
personality
Emotions, anger,
resentment,
satisfaction
Expectations
Focus on process
Tied to budget
Training
AND….
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1: PERFORMANCE
EVALUATION PROBLEMS
EEO requirements
Reliable
valid
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2: APPRAISAL PROCESS
STEPS
1. Establish
performance
appraisal standards
2. Mutually set
measurable goals
3. Measure actual
performance
AND….
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2: APPRAISAL PROCESS
STEPS
4. Compare actual
with standard
5. Discuss appraisal
with employee
6. Corrective action
Basic
Immediate
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2: APPRAISAL METHODS
Absolute standards
Measure against
external reference
Relative standards
Evaluate employees
against each other
Objectives
Measure against goals
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3: ABSOLUTE STANDARDS
Essay
Critical incident
Checklist
Adjective rating scale
Forced-choice
Behaviorally-Anchored
Rating Scale (BARS)
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3: ESSAYS
Subjective
Hard to compare with
others
Simple
Strengths
Weaknesses
Potential
Suggestions for
improvement
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3: CRITICAL INCIDENT
Essay about what was
most effective or
ineffective in a key
job situation
Focus on behavior,
not personality
Weekly is timeconsuming
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3: CHECKLIST
Yes or No
Predefined behaviors
or qualities
Items may be
irrelevant
Helps reduce bias
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3: ADJECTIVE RATING
SCALE
Factors present
Job knowledge
Cooperation
Quality and quantity
of work
5 to 10 points on a
continuum
• See Exhibit 10-3
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Exhibit 10-3: Sample Adjective Rating Items and Format
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3: FORCED-CHOICE
Bias and distortion
reduced
Frustration about lack
of feedback
Simple
Like a multiple choice
test question
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3: B.A.R.S.
Simple
Reduces rating errors
Definite, observable
job behaviors
– See Exhibit 10-4
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Exhibit 10-4: Sample BARS for an Employee Relations Specialist
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4: RELATIVE STANDARDS
Group order ranking
Quartiles
Individual ranking
Best to worst
Paired comparison
Similar to job ranking
Compare each one to
all others
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5: MANAGEMENT BY
OBJECTIVE (MBO)
STEPS
Goal setting
Action planning
Self control
Periodic review
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5: MBO ISSUES
Advantages
Results oriented
Commitment
Problems
Trust needed
Satisfaction
Time-consuming
Important to followup
Frustration builder
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6: PERFORMANCE
APPRAISAL DISTORTIONS
Leniency
Halo
Similarity
Central tendency
Inflationary pressures
Inappropriate
substitutes
AND….
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6: PERFORMANCE
APPRAISAL DISTORTIONS
Attribution theory
Varies by control
Internal
External
Impression
management
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7: TO IMPROVE
APPRAISALS
Behavior based
measures
Combine absolute
and relative measures
Provide ongoing
feedback
Have multiple raters
Rate selectively
Train appraisers
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8: MORE EFFECTIVE
APPRAISALS - PEERS
Positives
Constructive criticism
Specific feedback
Negatives
Fear
Halo, leniency error
Training
Upward appraisal
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8: MORE EFFECTIVE
APPRAISAL (360-DEGREE)
 Multiple appraisers
Self
Boss
Peers
Team members
Customers
Suppliers
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8: 360-DEGREE
APPRAISALS
Positives
Increase manager’s
awareness of own
actions
More accurate
feedback
Empowerment
Developing leadership
Reduces subjectivity
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9: GLOBAL ISSUES
Does the cultural
environment vary
from host country to
corporate?
Who does evaluation?
Host country
supervisor
Home office
AND…
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9: MORE GLOBAL ISSUES
What do numbers,
ranking mean?
Culture
Economic issues
Political realities
Evaluation format
AND….
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9: GLOBAL SUGGESTIONS
Modify to suit
Site
Culture
Use an expatriate
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REVIEW CHAPTER 10
How do we do
performance
appraisal in this
course?
Any suggestions to
improve it for next
semester?
Any suggestions for
this semester?
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QUICK: REVIEW
CHAPTER 10
ANSWER THESE QUESTIONS ON A SHEET
OF PAPER.
1. THE MOST IMPORTANT THING WE DID IN
CLASS TODAY _______.
2. I STILL HAVE QUESTIONS ABOUT___.
3. THE BEST THING ABOUT CLASS TODAY WAS
_______________.
4. DON’T DO ____________ ANYMORE.
• TURN THEM IN, PLEASE. NO NAMES. WE’LL TALK
NEXT CLASS SESSION
DeCenzo and Robbins HRM 7th
Edition
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PREVIEW: CHAPTER 11
Ask 3 people you know:
1 college student
1 40-60 year old worker
1 retiree
Why do/did you work?
Tell me about the best “reward” you
received from a job?
Write up their responses for 1 extra point on your final grade.
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Exhibit 10-1: The Appraisal Process
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Exhibit 10-2: Sample Checklist Items for Appraising
Customer Service Representative
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Exhibit 10-5: Factors That Distort Appraisals
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Exhibit 10-6: Towards a More Effective
Performance Management System
DeCenzo and Robbins HRM 7th
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