HRM REVIEWER 1 (Chapter 6: PERFORMANCE REVIEW AND APPRAISAL)

Multiple Person Evaluation Methods, Individual Evaluation Methods

PERFORMANCE APPRAISAL METHODS

Halo Effect, Recency Effect, Previous Performance Bias, Leniency/Harshness/Strictness Error, Central Tendency, Carelessness, Bias

PERFORMANCE APPRAISAL PROBLEMS AND SOLUTION

RELEVANCE, RELIABILITY, FREEDOM FROM CONTAMINATION

PERFORMANCE CRITERIA

HALO EFFECT

Problem: A manager or superior allows a general favorable impression of an employee to influence his or her judgment on each separate factor in the performance appraisal process. Solution: The rater should consider each factor independently of all other factors, rather than rating the employee at the same level on all (or most) factors in an appraisal.

BIAS

Problem: Individual differences among rates in terms of characteristic like age, race, sex, and religious and political affiliations. Evaluations are dependent on the rater's personal preferences, prejudices and biases. Solution: When rating employees the manager must consider the same relevant behaviors for all employees' supervised. Individual differences and other non-performance factors should not affect performance appraisal ratings

CARELESSNESS

Problem: Managers make quick guesses based on first impressions of an employee's performance. Solution: Managers commit significant time observing staff members and forming judgment based on their observation.

CENTRAL TENDENCY

Problem: Occurs when a manager rates all employees as average by choosing the middle rating. It closes the door to an employee's growth and improvement on a job, because no strength or weaknesses are identified. Solution: Ranking employees can avoid this error because all employee must be ranked and thus cannot all be rated average.

LENIENCY/HARSHNESS/STRICTNESS ERROR

Problem: Some managers tend to give mostly favorable rating while others tend to evaluate the same performance level unfavorably. Solution: Understanding the constructive purposes of performance appraisal and acquiring effective skills in giving negative feedback should reduce the tendency to commit this error.

Design the form first, Build your company's value into your form, Assure ongoing communication during development, Train all appraisers, Orient all appraises, Use the results, Monitor and revise the program

SEVEN TIPS FOR CREATING A WORLD-CLASS APPRAISAL SYSTEM

Production Data, Personnel Data, Judgment of others

SOURCES OF DATA IN APPRAISAL

CRITICAL INCIDENT METHOD

A method in which manager write down positive and negative performance behavior of employees throughout the performance period.

Review of overall progress, Discussion of problems that were encountered, Discussion of sources of ineffective performance, Agreement about how performance can be improved, Discussion on how current performance fits with long-range career goals, Specific action plans for the coming year and how to reach short and long-term objectives

ANNUAL DISCUSSION OF PERFORMANCE SHOULD INCLUDE:

Goal setting, Performance Standard setting, Information Dissemination, Actual Performance Measurement, Feedback Evaluation Result, Rewarding Exemplary Performance, Correcting Substandard Performance

STEP BY STEP GUIDE TO PERFORMANCE APPRAISALS

Organizations limit performance review to make employees accountable for past endeavor, Tying performance review to employee salary review

Common Flaws Identified with Performance Review System Design

Focusing on the employee's past performance, Focusing on the employee's development

EARLY APPROACHES TO PERFORMANCE APPRAISAL

Quantity, Quality,Timeliness, Cost-effectiveness, Absenteeism/Tardiness, Creativity, Adherence to Policy, Gossiping and other Personal Habits, Personal Appearance/Grooming

Indicators or Matrix that can help Measure Employee Performance

Critical Incident Method, Checklist and Weighted Checklist Method, Graphic Rating Scales, Behaviorally Anchored Rating Scales (BARS), Management by Objective (MBO), Multi-rater Assessment or the 360-degree Performance Feedback

Individual Evaluation Methods

MANAGEMENT BY OBJECTIVE (MBO)

Is a process in which managers and their subordinates set objectives for the employee to achieve within a specific rating period. Focuses attention on what must be accomplished (goals) rather than how it is accomplished (methods). Reward is given based on the result or output MBO allow easy linking of individual objective to work unit objectives. It reduces the likelihood of disagreement during appraisal meeting is standard and targets were written well during the performance planning process and considering employees were involved in the preparation and identification of targeted outcomes.

MULTI RATER ASSESSMENT OR THE 360 DEGREE PERFORMANCE FEEDBACK

Is a system or process in which employees receive confidential, anonymous feedback from people who work around them, their immediate superior, peers, customers or suppliers. The strength of this method lies on the fact that more people are involved in the evaluation instead of just relying on the supervisor hence bias is prevented.

Ranking Method, Paired Comparison Method, Forced Distribution

Multiple Person Evaluation Methods

It provides information upon which promotion, transfer, demotion, layoff, discharge, and salary decisions can be made, It provides an opportunity for the supervisor and his/her subordinates to review and identify their strengths and weaknesses or work related-behavior, It forms the basis in identifying the training needs of employees as well as evaluating the success of training, It helps in the firm's career planning process, It allows easy monitoring and supervision, It helps evaluate the individual's share relative to the team's contribution in achieving the organization's goal, It provides information to evaluate effectiveness of selection and placement decisions

OBJECTIVES OF PERFORMANCE APPRAISAL

Concrete and tangible particulars about their work, Assessment of performance; Personal development, Work satisfaction, Involvement in the organization

OBJECTIVES OF PERFORMANCE APPRAISAL According to: Employee Aims at:

Measuring the efficiency, Maintaining organizational control; Mutual goals of the employees & the organization, Growth & development, Increase harmony & enhance effectiveness

OBJECTIVES OF PERFORMANCE APPRAISAL According to: Organization Aims at:

RECENCY EFFECT

The Problem: Recent events tend to have an unusually strong influence on performance evaluation. Outstanding contribution or untimely mistake just prior to a performance review colors the manager's perception of the employee's performance for the entire appraisal period. Solution: An alert manager compensate for lack of perspective by careful documentation and to make refinements in the design of the appraisal method as well as including the skills of the rater.

PREVIOUS PERFORMANCE BIAS

The Problem: The employee who has performed well in distant past is assumed to be acceptable in the recent past also. The Solution: Once again observation and documentation of the employee's performance will give an accurate account of the performance period under scrutiny.

GRAPHIC RATING SCALE

This is the oldest and most widely used method for performance appraisal. The scale may specify five points so a factor such as job knowledge might be rate from 1 (poorly informed about work duties) to 5 (has complete mastery of all phases of the job) The rater asked to rate employees on each of the characteristic listed. Its main advantage is that the method allows quantitative comparison. This methods permits commenting on the employee's unique characteristics. It is more effective when specific example of employees' behavior are cited along with objective facts supported by any quantitative information. Its main drawback is that it is time consuming when describing all of the individual's characteristics and that it may be unfair since the quality may depend upon the writing skills of the rater.

CHECKLIST AND WEIGHTED CHECKLIST METHOD

This method describe a performance appraisal method where the rater, familiar with the job being evaluated, prepare a large list of descriptive statement about the effective and ineffective behavior on jobs.

BEHAVIORALLY ANCHORED RATING SCALES

This method is used to describe a performance rating that is focused on specific behavior or sets as indicators of effective or ineffective performance. It is a combination of the rating scales and critical incident techniques of employees' performance evaluation. This method evaluates observable behavior rather than subject perception but it requires a lot of time and effort to develop the scale.

Personnel Data

Type of information found in an individual's personnel files.

Manager/Supervisor Appraisal, Self-Appraisal, Subordinates Appraisal, Peer Appraisal, Customer/Supplier, Team Appraisal, Assessment Center, 360-Degree or "Full-Circle" Appraisal

Who Should Evaluate Performance?

Paired Comparison Method

consist of asking an evaluator to consider only two individuals at one time and to decide who is better.

Production Data

evaluate the degree of dependable task accomplishment by measuring quantity and quality of performance.

Forced Distribution

forced ranking is a method of performance appraisal that ranks employees through forced distribution.

PERFORMANCE REVIEW OR EVALUATION

is a systematic description and review of an individual's job performance.

PERFORMANCE MANAGEMENT

is an ongoing communication process, undertaken in partnership between an employee and his/her immediate supervisor.

PERFORMANCE REVIEW OR EVALUATION PERFORMANCE

is the accomplishment of an employee or manager's assigned duties and outcomes produced on a specified job function or activity during a specified time period.

RELIABILITY

produced consistent and repeatable evaluation.

Ranking Method

ranking the employee from the most efficient to the least capable.

RELEVANCE

relevant performance dimensions are determined by the duties and responsibilities xcontained in the job description.

FREEDOM FROM CONTAMINATION

should measure each employee's performance without being contaminated by factors that an employee cannot control such as economic conditions, materials shortage, or poor equipment.