METHODS OF PERFOMANCE APPRAISAL By Daniel, D TRADITIONAL METHODS MODERN METHODS 1 Rating scale method 1 Management by Objectives (MBO) 2 Essay Appraisal Method 2 360 degrees Performance Appraisal 3 Ranking Method 3 Customer feedback method 4 Paired Comparison Method 4 Assessment Centres 5 Checklist method 6 Graphic Rating Scale 5 Human Resource Accounting Method 7 Confidential Report System 6. Behaviorally Anchored Rating Scales Traditional methods 1. Rating scale method • In this method, a rating scale is created to evaluate the performance of employee against certain parameters. • These parameters usually include his attitude, attendance, punctuality, accountability, dedication, interpersonal skills etc. • The rating scale used in this method ranges from 1 to 10. Low score indicates negative feedback and high score indicates positive feedback. • Employee may be assessed by his superiors, colleagues, subordinates or sometimes by his customers. It depends on nature of the company or job. • Appraiser marks or chooses the numbers given on the scale on the basis of his observation. • 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 nonperformers. 2. Essay Appraisal Method • This method is also known as “Free Form method”. • Essay appraisal method involves superiors of employees writing description about the performance of their employees. • Appraiser evaluates the performance of an employee through his description. • Description should be based on facts and includes always examples and evidences. • The rater or appraiser is asked to express the strong as well as weak points of the employee’s behavior • The rater considers all relevant information like employee’s attitude, job knowledge, current performance and potential for growth, Planning, organizing and controlling ability in general etc The disadvantages of the methods are:- • The method is highly subjective. • This is time-consuming method. • A busy appraiser may write the essay without properly assessing the actual performance of the worker due to his busy schedule. 3. Ranking Method • In this method manager compares an employee to other similar employees, rather than to a standard measurement. • Employees are ranked from the best to the poorest on the basis of overall performance. • 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 • Managers have to make and 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 • It is the quick and simple method but also subjective so invites criticism 4. Paired Comparison Method • In this method, each employee is compared with other employees on one- on one basis, usually based on one trait only. • The rater is provided with a bunch of slips each coining pair of names, the rater puts a tick mark against the employee whom he insiders the better of the two. • The number of times this employee is compared as better with others determines his or her final ranking • The number of possible pairs for a given number of employees is ascertained by the following formula: N (N-1)/2 • Where N = the total number of employees to be evaluated. Let this be exemplified with an imaginary example. • If the following five employees have to be evaluated by the Principal of the college • Kichanja (K), Mabula (M) , Raul (R), Vaileth (V), and Bennedict (B), the above formula gives 5 (5 -1) / 2 or 10 pairs. • The number of times a worker is considered better makes his/her score. • Such scores are determined for each worker and he/she is ranked according to his/her score. • One obvious disadvantage of this method is that the method cannot be used in organizations with a large number of employees as it would be too difficult to compare so many people on an individual basis. 5. Checklist method • In this method, a series of statements, i.e., questions with their answers in ‘yes’ or ‘no’ are prepared by the HR department • The check-list is, then, presented to the rater to tick appropriate answers relevant to the appraisee. • Each question carries a weight-age in relationship to their importance. • When the check-list is completed, it is sent to the HR department to prepare the final scores for all appraises based on all questions 6. Graphic Rating Scale • Under this approach, the employees are evaluated on the basis of various job performance criterions like Attitude, Knowledge of Work, Managerial Skills, Team Work, Honesty, Regularity, Accountability, Interpersonal relationships, Creativity and Discipline etc., • Each criterion is categorically divided into poor, fairly poor, fairly good, good and excellent. Also, these criterions carry certain score weight. • The rater ticks the category that best describes the employee and finally the score is totaled. • This method is very popular because it is simple and does not require any writing ability. 7. Confidential Report System • Confidential report is the method of evaluating employee’s performance and taking necessary actions without giving any feedbacks to the employees. • Confidential report should only be viewed by authorized personnel. • Confidential report system is mostly being used by the Government organizations for promoting or transferring of any employee. • Superior writes confidential report after observing the following in an employee:• Knowledge and quality of work, • Character and conduct of an employee, • Absenteeism of an employee, • Punctuality of employee, • leave without permission, • Ability of supervision and controlling, • Integrity and honesty • Superior can also add remarks, if any. This report will be Confidential and will not be revealed to anyone. • Finally confidential reports will be forwarded to the concerned officials for taking decision. MODERN METHODS OF PERFOMARNCE APPRAISAL These are an improvement over the traditional methods. Modern methods are an attempt to remove defects from the old methods. The modern methods of judging the performance of employees includes:• Management by Objectives • Customer feedback method • 360 degrees Performance Appraisal • Assessment Centres • Human Resource Accounting Method • Behaviorally Anchored Rating Scales 1. Management by objectives (MBO) • In this method, managers and employees collaborate together to identify, plan, organize, and communicate objectives. • After setting clear goals, managers and employee interact periodically to discuss the feasibility of achieving set objectives and the progress made. • These measures of progress help analyze the contributions of an employee at the end of the review period. • Success is rewarded with appraisals like salary hike or promotion, whereas others are re-evaluated for further training 2. 360 degrees Performance Appraisal • 360 degree feedback, also known as ‘multi-rater feedback’, • It is the most comprehensive appraisal where the feedback collected from everyone an employee interacts with like managers, customers, peers. • When data is collected from multiple sources, the chances of a manager’s bias affecting the appraisal are eliminated. • Plus, it offers a clearer picture of the employee’s competence in terms of work. 3. Customer feedback method • This method is truly one of the modern methods of performance appraisal system. • Customer feedback method is used, especially for sales staff who deals with sales activity in the organization or those offering services • Under this method of appraisal system, customer feedback is directly linked with employee performance. • This method of assessment could be unbiased and reliable since customers who are outsiders may give correct judgement about employee performance than the insiders who are superiors. 4. Assessment Centres • An assessment Centre is a central location where the employees may come together to participate in job-related exercises, who are then evaluated by the trained observers. • The employees are assessed based on their performance through social-stimulating exercises like role-playing, decision-making, informal discussions, etc. • The effectiveness of the Assessment Center Method allows employees to get a clear picture of their own performance and how others observe them. • The assessment evaluates the performance of employees to identify future leaders and managers. 5. Human Resource Accounting Method • 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. • One disadvantage of this method is that workers are always in pressure to deliver the result 6. Behaviorally Anchored Rating Scales • This is a modern method which uses BARS to compare an employee’s performance with specific behavioral examples that are assigned a numerical rating. • As per employee’s role and job-level, BARS has a set of predetermined standards called BARS statements • These statements are used as benchmark to measure the performance on each BARS scale level. • BARS sets typical workplace behaviors as per a job role and evaluates an employee’s performance in comparison to these set standards. • The performance appraisal with BARS provides more accurate and unbiased results. THE END THANK YOU FOR YOUR ATTENTION
