What is Performance?
Result:
– Performance- refers to the effective and efficient accomplishment of GOALS/objectives.
– Performance may be stated in terms of levels:
Excellent
Outstanding
Good
Average
Poor
– Goals set shall be SMART[ER].
1. Specific
2. Measurable
3. Achievable/Attainable
4. Reliable/Reasonable/Realistic
5. Time specific
6. Enjoyable
7. Rewarding
What is Appraisal?
– Appraisals are judgments of the characteristics, traits and performance of others.
– On the basis of these judgments we assess the worth or value of others and identify what is good or
bad.
– In industry performance appraisal is a systematic evaluation of employees by supervisors.
– Employees also wish to know their position in the organization.
Definitions:
Dale S. Beach,
– "Performance appraisal is systematic evaluation of the individual with respect to his or her
performance on the job and his or her potential for development".
Randall S. Schuler,
– "Performance appraisal is a formal, structured system of measuring and evaluating an
employee’s job, related behaviour and outcomes to discover how the employee is presently
performing on the job and how the employee can perform more effectively in the future so that
the employee, organisation, and society all benefit."
– Performance appraisal is a method of evaluating the job performance of an employee.
– It is an ongoing process of obtaining, researching, analyzing and recording information about the
worth of an employee.
– It is also known as:
Employee/ performance rating,
Performance evaluation,
Employee assessment,
Performance review,
Merit rating, etc.
Objectives of appraisal
To determine the effectiveness of employees on their present jobs so as to decide their benefits.
To identify the shortcomings (S & W) of employees so as to overcome them through systematic
guidance (Provide coaching, counseling, career planning to subordinates) and training (training
needs can be identified through appraisal).
To find out their potential for promotion and advancement (Promotion is given to an employee
on the basis of performance appraisal).
Develop positive relation (minimizes the communication gap between the employer and
employee) and reduce grievance (The grievances of an employee are eliminated through
performance appraisal).
Significance of Performance Appraisal
– Appraisals are essential for making many administrative decisions:
Selection,
Training,
Promotion,
Transfer,
Wage and salary administration etc.
How often should appraisals take place?
– Performance appraisal in any organisation will be done at a specific period, like:
Annually
Or half yearly
Or quarterly
Or maybe regularly.
– It all depends upon the nature or size of the organisation, and sometimes necessity of the
managers decide the period of performance appraisal of their employees.
– The frequency of formal appraisals will depend on the nature of the organization and on the
objectives of the system.
Components of performance appraisal
– The employer has to look at various factors while appraising the employees.
– Given below are some important points that a typical review would include.
Quality of work
Quantity of work
Dependability
Punctuality
Communication skills
Problem-solving skills
Ability to work as part of a team
Compliance with company procedures
Progress made toward professional goals
Important factors include –
The objective factors like attendance, amount of work, efficiency, quality of work can be easily
measured by the records maintained by the Human Resource Department Manager.
However, when it comes to measuring subjective factors like attitude, behaviour, friendliness
etc. it is bit tough.
But to properly evaluate an individual’s performance, appraisal of both subjective and objective
factors needs to be done.
Who Should Do The Evaluation?
Supervisors/Immediate manager (most common)
Co-Workers (Peers)
Self
Subordinates
Client /customers
Process of PA
Step1: Setting performance standards
– The first step is the setting up of the standards which will be used to as the base to compare the
actual performance of the employees.
– This step requires setting the criteria to judge the performance of the employees as successful or
unsuccessful and the degrees of their contribution to the organizational goals and objectives.
– The standards set should be clear, easily understandable and in measurable terms.
Step 2: Communicating standards
– Once standards are set, it is the responsibility of the management to communicate the standards to
all the employees of the organization.
– The employees should be informed and the standards should be clearly explained to the employees.
– This will help them to understand their roles and to know what exactly is expected from them.
– The standards should also be communicated to the appraisers or the evaluators.
Step 3: Measuring standards
– The most difficult part of the Performance appraisal process is measuring the actual performance of
the employees, that is, the work done by the employees during the specified period of time.
– It is a continuous process which involves monitoring the performance throughout the year.
– This stage requires the careful selection of the appropriate techniques of measurement, taking care
that personal bias does not affect the outcome of the process.
Step 4: Comparing standards
– The actual performance is compared with the desired or the standard performance.
– The comparison tells the deviations in the performance of the employees from the standards set.
– The result can show the actual performance being more than the desired performance or, the actual
performance being less than the desired performance depicting a negative deviation in the
organizational performance.
Step 5: Discussing results
– The result of the appraisal is communicated and discussed with the employees on one-to-one basis.
– The results, the problems and the possible solutions are discussed with the aim of problem solving
and reaching consensus.
– Performance appraisal feedback by managers should be given in such way helpful to correct
mistakes done by the employees and help them to motivate for better performance but not to
demotivate.
Step 6: Decision-making--Taking corrective actions
– The purpose of conducting employee performance appraisal is for making decisions about
employees without any bias by the HR manager.
– Decision-making by HR managers about employees:
Rewarding, promotions, demotions, transfers and sometimes suspensions/dismissal of
employees are depended upon the employee performance appraisal.
– The decision taken by HR manager should match exactly with performance appraisal results of
employees --to avoid grievance or disturbances in between them, as they affect overall performance
of the organisation
