PREPARED BY : VARUN TANEJA RUCHI KAUSHIK GAGANDEEP KAUR NAVNEET KAUR

DEFINITION
Performance appraisal may be defined as the process of evaluating the employees performance on the job in terms of requirements of the job. It is the systematic, periodic and an impartial rating of an employees excellence in matters pertaining to his present job and to his potentialities for a better job.

NATURE OF APPRAISAL
 It is a formal programme in an organization which aims at spotting the potential of the people.  It involves establishments of a plan of improvement of employee's performance.  It influence the employees future level of effort, activities, results and direction.  It is used for taking personnel decisions such as promotion, transfer, etc.

PURPOSE OF APPRAISAL
 Define the specific job criteria against which performance will be measured.  Accurately measure job performance.  Justify the rewards given to individuals, thereby discriminating between high and low performance.  Define the development experiences the employee needs to both enhance performance in the current job and prepare for future responsibilities.

IMPORTANCE OF PERFORMANCE APPRAISAL

 It provides a scientific basis for judging the merit or worth of employees.  It is a sound basis for promotion, demotion, transfer or termination of employees.  It helps in distinguishing between efficient and inefficient workers. It reveals the defects in the selection procedure.

CONTD
 It helps the supervisors to evaluate the performance and to know the potentials of their subordinates.  It also helps them to assign work to individuals for which they are best suited. Thus it facilitates the correct placement of workers.  It helps in creating a congenial atmosphere of employer-employee relations.

ESSENTIALS OF PERFORMANCE APPRAISAL

 The employees should be made aware of the performance in terms of goals, targets, behavior, etc expected of them.  It should be ensured that the appraisal system itself is job-related, performance-based, uniform and nonvariable, fair, just and equitable.  Performance appraisal reports should be examined meticulously before taking any positive or negative action.

CONTD
 To promote intra and inter-departmental consistency and uniformity, line and staff coordination should be ensured.  There should be provision of appeals against appraisals to ensure confidence of the employees and their associations.  Supervisors responsible for performance appraisal should be well trained in the art and science of performance appraisal to ensure uniformity.

Traditional Methods of Performance Appraisal

 Ranking Method: - All workers are judged & rated on the overall basis with reference to their job performance rather than their traits.  Paired Comparison : - The rater is provided with a booklet containing two names on each page. Though it is tedious to construct but it provides more reliable rating than order of ranks.  Graphic Rating Scale : - The rater places a checkmark on a form next to the word describing the degree of merit for each of several traits such as quality / quantity of work, dependability, attitude, etc.

Graphic Rating Scale

Contd
 Forced Distribution Method: - a five point scale for job performance is used, & rater is asked to allocate 10% of the men to best end, 20% in the next category, 40% in middle category, 20% in the bracket next to low end & 10% in the lowest as follows: _________________________________________________ 10% 20% 40% 20% 10% Poorest Poorer Average Better Best than avg than avg

Contd
 Check-list method: - A list of specific statements describing the performance & behavior of an employee is prepared. A more recent variation of the checklist method is the weighted list. Under this, the value of each question may be weighted equally or certain questions may be weighted more heavily than others.
 Is the employee really interested in the task assigned?  Is he respected by his colleagues (co-workers)  Does he give respect to his superiors?  Does he follow instructions properly?  Does he make mistakes frequently? Yes/No

Yes/No Yes/No Yes/No Yes/No

Critical Incident method

 In this, manager prepares lists of statements of very effective and ineffective behavior of an employee.  These critical incidents or events represent the outstanding or poor behavior of employees on the job.  The manager maintains logs on each employee, whereby he periodically records critical incidents of the workers behavior.

An Example
 July 20 The sales assistant patiently attended to the customers complaint. He is polite, prompt, enthusiastic in solving the customers problem.  On the other hand the bad critical incident may appear as under:  July 20 The sales assistant stayed 45 minutes over on his break during the busiest part of the day. He failed to answer the store managers call. He is lazy, negligent, stubborn and uninterested in work.

Field Review Method

 Supervisors are interviewed by an expert belonging to personnel dept.  Workers : - Outstanding, satisfactory & unsatisfactory.  Interviewer Requirements of the job & the performance of each employee.

Criticism of traditional methods

 Scope & Objective : - limited to operative level workers, not applicable to technical, professional & managerial personnel. No emphasis on training & development.  Personal judgment of rater: - The appraiser is always subjected to personal bias as well as pressure from other certain areas.  Post appraisal Interview : - No free & frank discussions b/w superiors & subordinates to decide the appraisals.

Problems of the Appraisers

 Use of Abstract words : - good, adequate, satisfactory, which mean differently to different evaluators.  Central tendency : - when rater has inadequate information about the prospects.  Leniency / Strictness  Personal Bias of the rater  Recent Behavior Bias.

Appraisal by results or management by objectives (MBO)

 MBO is a process where the superior and subordinate managers of an organization jointly identify common goals, define each individuals major areas of responsibility in terms of results expected from him, and use these measures as guides for operating the unit and assessing the contribution of each of its members.  MBO is also referred as Management by results , Accountability Management , Performance Results and Individual Development Evaluation (PRIDE) , Work Planning and Review etc .

General Model of MBO

Assumptions  People perform better when they know what is expected and can establish a relationship between individual and organizational goals. People want to participate in determination of goals. People need to know how they are doing. Concept Let people know what is expected of them. Technique Develop scientific, measurable goals at All org levels.

Allow employees to Participate in setting goals. Tell people how they Are doing.

Involve employees In determining standards of performance Provide periodic Appraisals of Performance. Reward on the Basis of results.

People need recognition Reward on the basis opportunities for growth, and of accomplishment. a sense of achievement in their work.

Steps of MBO
 Setting of Objectives  Developing Action Plan  Establishing Check Points  Review of Performance

Merits of MBO
 Better Planning  Better Organization  Self Control  Higher Productivity  Better Appraisal of Performance  Executive Development

LIMITATIONS OF MBO

1. Hesitation In Shedding Traditional Thinking 2. Poor Planning 3. Lack Of Training 4. Limited Application 5. Inflexibility 6. Costly Process

What is 360 Degree Appraisal ???

360-degree Appraisal is an assessment process used to improve managerial effectiveness by providing the manager with a more complete assessment of their effectiveness, and their performance and development needs.

COMPONENT OF 360 DEGREE APPRAISAL

1. SELF APPRAISAL 2. SUPERIOR APPRAISAL 3. PEER GROUP APPRAISAL 4. SUBORDINATES APPRAISAL

COMPONENTS OF EFFECTIVE APPRAISAL PROGRAMME

1. DETERMINATION OF PURPOSE 2. TRAINING OF APPRAISER 3. ESTABLISHING STANDARDS OF PERFOMANCE 4. FREQUENCY OF APPRAISAL 5. PREPARATION OF FORMS

360 Degree Appraisal

-Advantages: -Reduces bias & Fits well with TQM initiatives -Disadvantages: -Complex -Raters may not provide fair feedback -Ganging up -Disagreements

Why 360 degree Appraisal Programs Fail ???

No perceived benefit Confrontation difficult Constructive feedback difficult Conflict between development and compensation

How to Implement 360 Degree?

Planning

360 Degree
Review

Piloting

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Implementation

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