Post on 08-Apr-2018
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ACKNOWLEDGEMENT
Preparing a project of this nature is an ardous task and I was fortunate to get a support
from a large number of people to whom I shall always remain grateful. I would like toexpress my gratitude to L & C Iinfrastructures Pvt Ltd for allowing me to undertake this
project.
I would take this oppurtunity to thank Mr. Guruprasad for providing me with an
oppurtunity to work for L & C Iinfrastructures Pvt Ltd.
I am also desirous of mentioning my profound in debtedness to Mr. Madhu Kumar,
faculty member, PES Institute Of Business Management, for the valuable advice, guidance,
precious time and support he offered.
I would be failing in my duty if I do not acknowledge my gratitude to Mr. Venugopal
Naidu, HOD PESBBM, who motivated me a lot in carrying out this project.
Last but not the least I would also like to thank all the respondants for giving me precious
time, relevant information and advice without which I would not be able to complete this
project.
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CONTENTS
SECTION PAGE NO.
1.Company Profile.2.Importance And Purpose.
3.
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PERFORMANCE APPRAISAL
The history of performance appraisal is quite brief. Its roots in the early 20th century can
be traced to Taylor's pioneering Time and Motion studies. But this is not very helpful, for
the same may be said about almost everything in the field of modern human resources
management.
As a distinct and formal management procedure used in the evaluation of workperformance, appraisal really dates from the time of the Second World War - not morethan 60 years ago.Yet in a broader sense, the practice of appraisal is a very ancient art. In the scale ofthings historical, it might well lay claim to being the world's second oldest profession!There is, says Dulewicz (1989), "... a basic human tendency to make judgements aboutthose one is working with, as well as about oneself." Appraisal, it seems, is bothinevitable and universal. In the absence of a carefully structured system of appraisal,people will tend to judge the work performance of others, including subordinates,naturally, informally and arbitrarily.
The human inclination to judge can create serious motivational, ethical and legalproblems in the workplace. Without a structured appraisal system, there is little chanceof ensuring that the judgements made will be lawful, fair, defensible and accurate.
Performance appraisal systems began as simple methods of income justification. Thatis, appraisal was used to decide whether or not the salary or wage of an individualemployee was justified.
The process was firmly linked to material outcomes. If an employee's performance wasfound to be less than ideal, a cut in pay would follow. On the other hand, if theirperformance was better than the supervisor expected, a pay rise was in order.
Little consideration, if any, was given to the developmental possibilities of appraisal. Ifwas felt that a cut in pay, or a rise, should provide the only required impetus for anemployee to either improve or continue to perform well.Sometimes this basic system succeeded in getting the results that were intended; but
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more often than not, it failed.For example, early motivational researchers were aware that different people withroughly equal work abilities could be paid the same amount of money and yet havequite different levels of motivation and performance.
These observations were confirmed in empirical studies. Pay rates were important, yes;but they were not the only element that had an impact on employee performance. It wasfound that other issues, such as morale and self-esteem, could also have a majorinfluence.
As a result, the traditional emphasis on reward outcomes was progressively rejected. Inthe 1950s in the United States, the potential usefulness of appraisal as tool formotivation and development was gradually recognized. The general model ofperformance appraisal, as it is known today, began from that time.
Modern Appraisal
Performance appraisal may be defined as a structured formal interaction between asubordinate and supervisor, that usually takes the form of a periodic interview (annualor semi-annual), in which the work performance of the subordinate is examined anddiscussed, with a view to identifying weaknesses and strengths as well as opportunitiesfor improvement and skills development.
In many organizations - but not all - appraisal results are used, either directly orindirectly, to help determine reward outcomes. That is, the appraisal results are used to
identify the better performing employees who should get the majority of available meritpay increases, bonuses, and promotions.By the same token, appraisal results are used to identify the poorer performers whomay require some form of counseling, or in extreme cases, demotion, dismissal ordecreases in pay. (Organizations need to be aware of laws in their country that mightrestrict their capacity to dismiss employees or decrease pay.)Whether this is an appropriate use of performance appraisal - the assignment andjustification of rewards and penalties - is a very uncertain and contentious matter.
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IMPORTANCE OF
PERFORMANCE APPRAISAL
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Performance appraisals provide employees and managers with opportunities to discuss
areas in which employees excel and those in which employees need improvement.
Performance appraisals should be conducted on a regular basis, and they need not be
directly attached to promotion opportunities.
Personal Attention
During a performance appraisal review, a supervisor and an employee discuss the
employee's strengths and weaknesses. This gives the employee individual face time
with the supervisor and a chance to address personal concerns.
Feedback
Employees need to know when theirjob duties are being fulfilled and when there are
issues with their work performance. Managers should schedule this communication on a
regular basis.
Career PathPerformance appraisals allow employees and supervisors to discuss goals that must be
met to advance within the company. This can include identifying skills that must be
acquired, areas in which one must improve, and educational courses that must be
completed.
Employee Accountability
When employees know there will be regularly scheduled evaluations, they realize that
they are accountable for their job performance.
Communicate Divisional and Company GoalsBesides communicating employees' individual goals, employee appraisals provide the
opportunity for managers to explain organizational goals and the ways in which
employees can participate in the achievement of those goals.
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PURPOSE OF PERFORMANCE
APPRAISAL.
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y Provide information to assist in the HR decisions like promotions,transfers etc.
y Provide clarity ofthe expectationsand responsibilities ofthe functionsto be performed
bythe employees.y To judge the effectiveness ofthe otherhuman resource functions ofthe organization such
asrecruitment,selection,training and development.
y To reduce the grievances ofthe employees.y Helpsto strengthen the relationship and communication between superiorsubordinates
and management employees.
According to arecentsurvey,the percentage of organisations (out ofthe total organisationssurveyed i.e. 50) using performance appraisal forthe various purposesare asshown in the
diagram below:
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The mostsignificantreasons of using Performance appraisalare:
y Making payroll and compensation decisions 80%.
y Training and development needs 71%.
y Identifying the gaps in desired and actual performance and its cause 76%.y
D
eciding future goalsand course ofaction 42%.y Promotions, demotionsand transfers 49%.y Otherpurposes 6% (including job analysisand providing superiorsupport,assistance
and counseling).
Self Appraisal. Performance Appraisal Feedback.
Performance Review Preparation. Performance Consulting:Moving Beyond
Trainning.
Performance Review The Meeting. Writing Performance Appraisal.
HowTo Complete A Performance AppraisalForm.
Performance Appraisal Trainning.
Analysis ForImproving Performance. HowTo Measure Employee Performance.
Active Performance Appraisal Conversation. FAQ AboutPerformance Appraisal.
Self Appraisal :
Selfappraisal isan important part ofthePerformance appraisal processwhere the employee
himself givesthe feedback orhis viewsand pointsregarding his performance. Usuallythis is
done withthe help ofaselfappraisal formwhere the employee rateshimself on various
parameters,tellsabouthistraining needs, ifany,talksabouthisaccomplishments,strengths,
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weaknesses, problems faced etc.
TIPS FOR SELF APPRAISAL
y Be honest
Always be truthful and honestwhile telling youraccomplishments orfailures. Dontexaggerate yourstrengthsand donthide yourweaknesses. Dontmake personal
judgments foranybody.
y Do the preparation
Itsalways betterto prepare yourself before the meeting. Getall the lists in place,
prepare all the evidencesand references.y Be objective
Objectivity is important in self appraisal. Dont exaggerate ordownplayyour
achievements orfailures. Be specific and concise in yourstatementsand if possible
supportthemwith examples orreferences orevidenceswith dates. Forexample: "I
responded to all querieswithin 48 hours" is betterthan justsaying "My customer
service was good."
y Positive attitude
Have a positive attitude towardsthe whole appraisal process. Be co-operative. Dont
hesitate fromtaking the responsibility ofyourfailuresaswell asthe achievements.
Demonstrate enthusiasmto improve in future and take all hissuggestions calmly. Dont
complain ordemonstrate a negative attitude.
y Cover all the aspects
Apart fromyourstrengths,weaknesses,accomplishmentsand failures, expressthe
opportunitiesyou would like have foryourdevelopmentand improvement. Suggest
waysto overcome the problems faced. Assessyourcapabilities, behavioursand skills
and competence.
y Seek future responsibilities
According to the assessment ofthe KSAsaccording to yourjob description, plan the
shorttermand long term forthe nextyear.T
ryto look fortasks beyond yourcurrent jobresponsibilities. Thiswill help in personal developmentaswell as contributing to the
organizational productivity.
Selfappraisal should ideally include the accomplishments,the goalsachieved,the
failures,and the personal growth (i.e. newskillsacquired, preparation forthe future
etc.),the obstacles faced during the period,the efforts forremoving them,the
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suggestions,and the areas oftraining and development felt bythe employee.
.
Performance Review Preparation:
The performance reviewmeeting should not be strictly formal norshould it be completely
informal in nature. Ideally,the review meeting should be structured,semi formal meeting
which needs priorpreparation bythe appraiseraswell asthe employee foritto be effective.
Following are some pointsthat need to be prepared before the reviewmeeting ofPerformance
appraisal:
y Informthe concerned employeesthe date,time and place forthe reviewmeeting well inadvance.
y Reviewand be prepared with eachand every employees .
o Job description.
o Performance standards.o Planned performance goals.
o Performance measures collected throughoutthe time period.o The critical incidents details.o Pastappraisals ofthe employees.
y Be readywithall the important dates.
y Give the employee a copy ofthe appraisal form.
y The appraiserneedsto completely understand the standards forthe employeesatsamelevel to maintain the consistency in the process.
y Prepare whatto sayand howto say it calmly.y The feedbackshould be prepared in quantifiable measureswhere everpossible.
y The appraisershould be familiarwiththe performance review formand the details.y The employee and the appraiserbothshould be prepared to discussand figure outthe
future goalsand training needs.y Theyshould be mentally prepared forconstructive feedback.
y Collectasmany evidencesto supportyourpointas possible like the monthly, quarterlyprogressreports.
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Performance Review Meeting:
Today,performance review meetingsare regarded as conversation witha purpose. Theyare
considered extremely important forthe developmentand health ofthe organization.The purposeofthe performance reviewmeetings isto reachmutuallyagreed conclusionsaboutthe
development ofthe individual and his performance and ifapplicable,anyareas forimprovement,
including howsuch improvementsare to be achieved.
The purpose ofperformance and developmentreviews isto enable the employeesto engage ina dialogue and getthe support ofthe manageraboutthe individuals performance and
development. Theyshould be more like free- flowing, open meetings in which viewsareexchanged so thatagreed conclusions can be reached.
The three key elements of performance reviewmeetingsare:
1.Feedback -Providing information on howa person has been doing.2.Measurement assessing resultsagainstagreed targetsand standards.3.Exchange of views - Ensuring thatthe discussion involvesa full, free and frank
exchange of viewsaboutwhathas been achieved,what needsto be done to achieve moreand what employeesthinkabouttheirworkthe waytheyare managed and their
aspirations.
Performance appraisalreview isthe meeting when the employee can be motivated to perform
betterin future orreinforce his desirable behaviour. Review discussion meetings ideallyshould
include the following:
y Review of progress on tasksand activities in relation to the employees performance
plan,y The developmental initiativestaken bythe employee himselfand those planned bythe
management forthe employee.y Identification of variances in terms of delays,requisite qualityand shortfall in help
planned forthe employee, ifanyy Analyzing the causes ofthe delay,the problems faced and the solutionsadopted.
y Preparation ofaction steps forsolving identified problemsand contingency plans foranticipated problems.
Periodic review meetings become meaningful onlywhen theyhelp pause,reflect,take stockand strategize in an otherwise active relationship.
How To Complete A Performance Appraisal Form:
Performance appraisal form providesthe basis forthe performance review, providing the
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feedbackto the employeesand the final rating ofthe employee. Italso facilitates various otherHR decisionsand careerdevelopment plansand decisions ofthe employees.
Therefore,performance appraisal fromshould be filled with utmost care and objectivity.
The Performance appraisal formshould be filled bythe immediate supervisorormanagerofthe
employee in orderto ensure thatthe appraiserif fullyacquainted withthe performance,responsibilities,targetsand standards ofthe employee. All the instructionsand guidelines on theappraisal formshould be read and followed carefully.
y Be prepared withall the details ofthe performance,the standards, job description and the
pastappraisals ofthe employee.y Clearand unambiguous description ofthe employee performanceshould be given in
terms ofaverage,above average, good and excellent performance.y The focusshould be on the employees behaviourthroughoutthe yearand not justhis
recent performance.y Quantifythe ratings,whereverpossible,to ensure easy comparability.
y
Substantiate and supportyourrating,and attachall the necessary documents (ifrequired).y Apart fromthe defined performance objectivesand results, discussthe related issuesas
well covering all the aspects ofthe performance.y When filling the appraisal form, be honestand objective.
Analysis for improving performance:
Any performance review process is incomplete withoutthe feedbackto the employees. The
feedback could be given in the review discussion. Review discussionsare semi formal,
scheduled, periodic interactions usually bimonthly orquarterly between amanagerand hisemployee. The basic purpose ofthe review discussion isto analyze the performance of theemployee in the pastto improve the performance ofthe employee in future.
A review discussion isan opportunityto coach,mentor, learn and understand. The manager
encourageshis/heremployeesto criticallyreflect overprogressmade on the Performanceappraisal plan and to develop creative,yet feasible alternatives forproblemareas.
y Reviewthe performance ofthe each employee individually.
y Discussthe problems faced bythe employees during the course ofaction.y The solutionstried,and the degree ofsuccessachieved in solving the problems faced.
y
Revisitwiththe employee,his/herannual plan forthe remaining time period and developrevised action plans, if necessary.
Review discussionsreassure the employeesthat each one ofthemhasstructured opportunitiesforone to one interaction withthe manageronce everytwo orthree months during the year.
These opportunitiesare importantasthey provide an important chance forperformancemonitoring ordevelopmentmentoring. The aim ofthe performance review discussions isto
share perceptions,solve the problem faced during the course ofthe action, decide on the new
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goals jointlyand provide afeedbackto the employee forthe past performance i.e. to lookathisstrengthsand weaknessesand also help to chart outa careerplan forthe employee.
The focus ofthese performance review discussionsshould not bet o judge the employees past
performance; ratheritshould be to motivate the employee to improve his future performance and
reinforce his good behaviour.
Active Performance Appraisal Conversation:
Active conversation playsan important part in the performance reviewmeeting. The appraisershould ensure thatthe meeting hasatwo way conversation and thatthe employee should geta
fairchance to speak. The "manner" of giving the feedbackofthe performance ofthe employee isvery important. The conversation should have an optimistic and motivating tone.
Some important pointsthatshould be taken care of in the active performance appraisalconversationare:
1.Make it a two-way conversation. An effective Performance appraisalreviewrequiresaninteractive discussion withan open agenda. Tryto formulate questionsthatseekthe
employees ideasand input. Thiswill help the employee feel you value his orheropinions. Give the employee a fairchance to put forward his ideas; lethimspeak.
2.Be a good listener. Rememberto be an active listenerand to pick up on youremployeesverbal and nonverbal cues. Listen to his ideasand problems.
3.Address whats important to the employee. Since job satisfaction isthe most importantfactoraffecting an employees attitude (and therefore his orherlevel of performance
and value to yourcompany),an effective reviewshould delve into areasthat includeissuesmost importantto that employee.
4.Lead with the positive.Its importantto reaffirmthe employees strengthsatthebeginning ofthe review. Since job security isthe numberone concern ofmost people,the
performance review isa good time to tell an employee howmuchyou value theircontributionsto yourbusiness.
5.Dont be confrontational.Its important notto criticize the employee in general terms.The goal isto evaluate job performanceand notthe person. A performance reviewthat
turns into a gripe session missesthe opportunityto raise employee morale.6.Positive reinforcement emphasizing whathas been done well so that itwill be done
even betterin the future and making only constructive criticisms (i.e. those that pointthewayto improvement).
7.Exchange of views - Ensuring thatthe discussion involvesa full, free and frankexchange of viewsaboutwhathas been achieved,what needsto be done to achieve more
and whatthe appraiserthinkabouttheirworkthe waytheyare managed and theiraspirations.
8.Agreement - jointly coming to an understanding aboutwhathasto be done by bothpartiesto improve performance, knowledge and skillsand overcome anywork problems
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raised during the discussion.
Performance appraisal feedback:
Performance appraisal process is incomplete withoutthe feedback given to the employee about
hisappraisal and his performance. Butthe way of giving aswell asreceiving the feedback differsfrom person to person and theirway ofhandling and theiroutlooktowardsthe issue.
According to a popularsaying:
"A SUCCESSFUL MAN IS ONE WHO CAN LAY A FIRM FOUNDATION WITH THE
BRICKS OTHERS HAVE THROWN AT HIM."
Therefore,On the part ofthe person receiving the feedback,the following pointsare importantto
be taken care of:
o The employee should have a positive attitude towardsthe feedback process
o He should listen to the suggestions ofthe appraisercalmlyand tryto incorporate them in
his plans.o He should nothesitate to ask forthe help ofhissuperiors.
o Should have a co-operative attitude during the feedbackmeeting.oDont judge the appraiserasa person.
o Should take the feedback objectively.o Should not judge the appraiserasa person on the basis ofthe feedback.
On the part ofthe appraiserorthe manager/ person giving the feedback,the following pointsareto be taken care of:
o The appraisershould make the receiverfeel comfortable during the feedbackmeeting.
o The appraisershould make itatwo way conversation i.e. letthe employee speak.o Listen to the employee and note his points,suggestions, problems etc.
o The appraisershould notadopta confrontational approachtowardsthe meeting. The goalis notto criticize the employee.
o Provide aconstructive feedbackto the employee i.e. in awaywhichwill motivate himto perform better.
o Have a positive attitude towardsthe processo
Tryto understand the reasons ofhis failure.
o Be fairand objectiveo Prepare yourself forwhatto sayand howto say.
oMake the appraisal feedbackmeeting useful and productive forthe organization and theemployee.
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PERFORMANCE CONSULTING : MOVING BEYONG TRAINNING.
Organisationsare growing in size, becoming complex and the importance oftrained and
developed workforce isalso increasing. One ofthe majorobjectivesand benefits ofthe
performance appraisal isthat ithelps in identifying the training needs ofthe employee and
reducing the gap between the actual and the desired performance ofthe employees. ButPerformance appraisalalso facilitatesthe otherdecisions like:
y Compensation and rewards
y Performance Feedback
y Manpowerplanning
y Performance improvement
y Promotionsand transfers
y HRDocumentation
To meetthe increasing competition and the challenging organizational goal,the human resourcedepartments ofthe organisationsthroughoutthe world are moving away fromthe traditional andthe theoretical training methods. The organisationsare focusing on "Performance Consulting"
i.e. the practical aspects ofthe employee training and whatthe employeesshould do to achievethe organizational goals.
Therefore,to improve the effectivenessand the performance,the conventional role ofthe trainers
have changed to "performance or HR consultants".
Performance consulting refersto the actual transferofthe newskills, competenciesacquiredthroughthe training to the job, focusing on the employees performance needs i.e. the needsto
improve the performance.
The responsibilitiesand roles of performance consultantare:
y To attain a balance between the needs ofthe organisation and the employees.
y Create synergyand teamwork.y Identifying and solving the problems faced bythe employees.
y Assessing and measuring the actual performance ofthe employees.y Identifying and improving the internal and external factorsaffecting the performance of
the employees.y Motivate and supportthe employees.
y Reviewand feedback ofthe performance, facilitating performance improvement
Fromthe above functionsand the role ofthe performance consultants,theyhave becomevalued partnersto the top level management ofthe organisations in successfullyachieving the
organizational goals.
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Writings Performance Appraisal:
Writing performance appraisal involves creating a documentwhichhasthe summary ofthe
every employees performance overa period oftime and asnapshot oftheirobserved strengths
and weaknesses,and the raters feedbackthat can be used forotherpurposes.
Writing Performance appraisal depend significantly on the writers variousabilitiesand a
combination of otherfactors. A rateroramanagerneeds:
y An objective rating method to assessan employees performance, behavior,and skills
and knowledge.
y All the relevant datarelated to the employees performance,the standards,his job
description.
y To observe and accuratelyrecall the employees behaviorthroughoutthe time period of
the appraisal.yUsing meaningful, unambiguousand clearlanguage forthe description in the
document.The written performance appraisal documentshould ideally contain 3 basic sections:
Performance elementsA performance element isa general description ofan employees overallresponsibility in a particulararea ofwork. Performance elementsare basicallythe
job description ofthe employee clearly describing the rolesand responsibilitiesexpected from him.
Performance standardsPerformance standardsare the expected orthe desired level ofthe tasksto beaccomplished by the employee.
Actual performanceThissection recordsthe data ofthe actual performance ofthe employee,hisaccomplishments,successesand failures,his on-the-job performance,hisstrengths
and weaknesses.
Plans for employee development
The developmental requirements (the training needs) felt orfound bythe appraiserfor the employee.
An overall rating
An overall rating forthe employees overall performance like satisfactoryperformance, unsatisfactory performance, requires improvement etc.
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The common errorsthat creep in the writing the appraisalsand should be avoidedare:
Halo effect:Halo effect isthe tendency ofthe raterto allow one aspect ofamans characterto
influence his overall rating of the employee.
Central tendencyCentral tendency isthe tendency ofthe raterto give average ratingsto the employeewithout actually appraising or condemning them.
Recent behaviour (the pitchfork effect)As perthe human nature, it isa common tendencyto rate the people on the basis oftheirmoatrecent behaviourand forgetting the eventsand theirperformance in the
starting of the period.
Stereotyping an employee on the basis ofthe performance ofhis/herteam isanothercommon error.
Therefore,with properpreparation,training and effort,writing appraisals can be
converted fromatime consuming activity into ameaningful activity fortheemployee and the organization.
Performance Appraisal Trainning :
Every organisation conducts performance forassessing the performance oftheemployeesand the organisation. But if not conducted properly,they can give a false
impression abouttheperformance of the employeesand affectthe overallperformance ofthe organisation; therefore,there isa need to train the appraisersto
ensure the maximum effectiveness of the process.
Studieshave revealed thatappraisalsare often conducted bythe managersand thesupervisorwho sometimes,are themselves notaware ofthe proceduresto be
followed. Theyshould be explained the importance and the implications ofthe Performance appraisalto the organisations,the methodsto be followed,the
principlesand the processes ofthe appraisal.
All managersand supervisorswho consultperformance appraisalsshould be giventraining forthe following:
y Methods,techniquesand guidelines forsetting goalsand objectives
y Howto evaluate the performance and rate the employeesy Standards forperformance documentation
y Howto complete a performance appraisal formy Howto maintain objectivity in the appraisal
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y Questioning techniques forappraisalsy Responding to employee reactions
y Improvesrapportand communicationy Building morale and motivating employees
y Observing and measuring performancey
Tracking results
y Structuring the interviewwiththe focus on improving performancey Feedback techniques (providing constructive feedback)
y Howto deal with non-performersand people who refuse to co-operatey Postreviewactions
The training can be given by conducting special workshops by professional HR
consultants orqualified and experienced HR professionals ofhuman resourcemanagement. The venue forthe purpose can be asuitable seminarhall,training
room, conference hall, boardroom, oratsome place away fromthe workplace likesome hotel etc.
HOW TOMEASURE EMPLOYEE PERFORMANCE
The most difficult part ofthe performance appraisal process isto accurately andobjectivelymeasure the employee performance. Measuring the performance coversthe
evaluation ofthe main tasks completed and the accomplishments ofthe employee in a giventime period in comparison withthe goalssetatthe beginning ofthe period. Measuring also
encompassesthe quality ofthe accomplishments,the compliance withthe desired standards,the costs involved and the time taken in achieving the results.
Measuring employee performance isthe basis ofthe Performance appraisal processesand
performance management. Accurate and efficient performance measurement not only formsthe basis ofan accurate performance review butalso giveswayto judging and measuring
employee potential.
Forthe purpose ofmeasuring employee performance, different input forms can be used for
taking the feedbackfromthe varioussources like the superior, peers, customers, vendorsand
the employee himself. All the perspectivesthusreceived should be combined in the
appropriate mannerand to getan overall, complete view ofthe employees performance.
Observation can also be exercised bythe superiorto obtain information. Some suggestions
and tips formeasuring employee performance are:
y Clearly define and develop the employee plans ofaction (performance) withtheirrole, dutiesand responsibilities.
y Organizational outcomes orthe achievement of organizational goalsshould also bekept in mind.
y Focus on accomplishmentsand resultsratherthan on activities.y Also take note ofthe skills, knowledge and competenciesand behaviors ofthe
employeesthathelp the organisation to achieve its goals.
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y If possible, collectthe feedbackaboutthe performance ofthe employeesthroughmulti-point feedbackand self-assessments.
y Financial measures like the return on investment,the marketshare,the profitgenerated bythe performance ofthe teamshould also be considered.
Foran organisation to be an effective organisation and to achieve its goals, it is veryimportantto monitorormeasure its and its employee performance on aregularbasis.Effective monitoring and measuring also includes providing timely feedbackand reviewsto
employees fortheirworkand performance according to the pre-determined goalsandstandardsand solving the problems faced. Timelyrecognition ofthe accomplishmentsalso
motivatesthe employeesand help to improve the performance.
Measuring the performance ofthe employees based only on one orsome factors canprovide with inaccurate resultsand leave a bad impression on the employeesaswell asthe
organisation. Forexample: Bymeasuring onlythe activities in employees performance,anorganization mightrate most of its employeesas outstanding, even when the organisation as
awhole mighthave failed to meet its goalsand objectives.Therefore,a balanced set ofmeasures (commonly known as balanced scorecard) should be used formeasuring the
performance ofthe employee.
FAQs About Performance Appraisal Program
Q. What is the purpose of performance appraisals?
A.Performance appraisalshelp to strategicallyreviewthe performance ofthe employees,
theirstrengths,weaknessesand accomplishments during the year. Performance
appraisalallows deciding the goals, objectivesand the desired performance standards forthe employee forthe upcoming year.
Q. How should the self appraisal be used?
A.Selfappraisal orself evaluation isthe review ofthe performance bythe employee
himself. Theself evaluationshould be discussed withthe employee and ifappropriate,should be incorporated in the final rating.
Q. Is there any comprehensive formula to calculate the overall rating?
A. No,there is no comprehensive formula fordoing so. The overall rating should be based
on a numberof factors like the extent of goalsachieved,the overall performance ofthe
employee,his competencies etc.
Q. How should the ratings be given if there has been a change of supervisor or manager
during the period of the appraisal?
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A.To complete the Performance appraisalsubjectivelyand fairly, it isadvised to consultthe
previoussupervisorormanager. Ifthis is not possible, consultthe supervisorssuperiorto
gethis viewsand inputs.
Q. How can input/feedback be collected for the appraisal process?
A. different input forms can be used fortaking the feedbackfromthe varioussources like the
superior, peers, customers, vendorsand the employee himself. All the perspectivesthus
received should be combined in the appropriate mannerand to getan overall, complete view
ofthe employees performance. Observation can also be exercised bythe superiorto obtain
information.
Q. What if the employee refuses to agree or/and accept the review?
A. First ofall, ensure thatthe employee has gota chance to reviewhis completed appraisalform. Ifthe employee refusesto accepthisappraisal,tryto sort outthe problem by
discussing hisreasons of dissatisfaction withhim calmly. Ifthe employee refusesto co-
operate,then passthe documentsto the HR departmentwitha note on itthatthe employee
hasrefused to acceptand letthemtake the necessaryaction.
Q. How do you deal with an average or a non-performer?
y Provide constructive feedbackand tryto motivate the employee.y Keep the focus on the performance, notthe personality ofthe employee.
y
Provide training and development opportunitiesto the employeey Discussand take the employees inputs on howto solve the problem.
y Plan the course ofaction and standards in agreementwiththe employee.y If no improvementtakes place, informthe human resources oryoursuperiorabout
the problem.
Q. Should the review be confidential?
A.The Individual performance reviewsshould be kept confidential and should not beaccessible to otheremployees. Theyshould also be stored atasafe place with limited access.
Outdated reviewsshould be destroyed. The appraisal can also be keptasa part ofthe HR
records ofthe employee.
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CHALLENGES OF
PERFORMANCE APPRAISAL
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An organization comesacross various problemsand challenges Of PerformanceAppraisal in orderto make a performance appraisal system effective and successful. The
main Performance Appraisal challenges involved in theperformance appraisal processare:
yDetermining the evaluation criteriaIdentification ofthe appraisal criteria is one ofthe biggest problems faced bythe topmanagement. The performance datato be considered forevaluation should be
carefullyselected. Forthe purpose of evaluation,the criteriaselected should bein quantifiable or measurable terms
yCreate a rating instrument The purpose ofthe Performance appraisalprocess isto judge the performance ofthe
employeesratherthan the employee. The focus ofthe systemshould be on the
development ofthe employees ofthe organization.
y Lack of competence Top managementshould choose the raters orthe evaluators carefully. Theyshould
have the required expertise and the knowledge to decide the criteriaaccurately. Theyshould have the experience and the necessarytraining to carry outthe appraisal
process objectively.
y Errors in rating and evaluation Many errors based on the personal bias like stereotyping,halo effect (i.e. one trait
influencing the evaluatorsrating forall othertraits) etc. may creep in the appraisalprocess. Therefore the ratershould exercise objectivityand fairness in evaluating
and rating the performance of the employees.
yResistanceThe appraisal processmay face resistance fromthe employeesand the trade unionsforthe fearof negative ratings. Therefore,the employeesshould be communicated
and clearly explained the purpose aswell the process of appraisal. The standardsshould be clearly communicated and every employee should be made aware thatwhat
exactly is expected fromhim/her.
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Pre-requisites for Effective &
Successful Performance Appraisal
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The essentials of an effective performance system are as follows:
y Documentation means continuous noting and documenting the performance. It also helps the
evaluators to give a proof and the basis of their ratings.
y Standards / Goals the standards set should be clear, easy to understand, achievable, motivating, time
bound and measurable.
y Practical and simple format - The appraisal format should be simple, clear, fair and objective. Long and
complicated formats are time consuming, difficult to understand, and do not elicit much useful information.
y Evaluation technique An appropriate evaluation technique should be selected; the appraisal
system should be performance based and uniform. The criteria for evaluation should be based on
observable and measurable characteristics of the behavior of the employee.
y Communication Communication is an indispensable part of the Performance appraisalprocess. The
desired behavior or the expected results should be communicated to the employees as well as the
evaluators. Communication also plays an important role in the review or feedback meeting. Open
communication system motivates the employees to actively participate in the appraisal process.
y Feedback The purpose of the feedback should be developmental rather than judgmental. To
maintain its utility, timely feedback should be provided to the employees and the manner of giving
feedback should be such that it should have a motivating effect on the employees future performance.
y Personal Bias Interpersonal relationships can influence the evaluation and the decisions in the
performance appraisal process. Therefore, the evaluators should be trained to carry out the processes
of appraisals without personal bias and effectively.
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PERFORMANCE APPRAISAL STRUCTURE
IN THE ORGANISATION.
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Summary of the Performance Analysis System
Setting performance standards, observing and providing feedback, and conducting
appraisals enables the Team Leaderto achieve the best results through managing employee
performance
To beginthe process, the Team Leaderand the employee collaborates on the
development of performance standards. The Team Leaderthen develops a performance
plan that directs the employee's efforts toward achieving specific results, to support
organizational growthas well asthe employee's professional growth. Discussion of goals
and objectives throughout the yearprovides a frameworkto ensure that employees
achieve resultsthroughOne on One and mutual feedback. Atthe end ofthe rating period,
the Team Leaderappraises the employee's performance against existing standards, and
establishes new goalstogetherforthe nextrating period.
As the immediate supervisor, the Team Leader plays an important role; his closest
interaction with the employee occurs at this level.
There are four key elements in the appraisal system:
1. Set objectives - Decide what the Team Leader wants from the employees and
agree these objectives with them.
2. Manage performance - Give employees the tools, resources and training they
need to perform well.
3. Carry out the appraisal - monitor and assess the employees' performance,
discuss those assessments with them and agree on future objectives.
4. Provide rewards/remedies - Consider pay awards and/or promotion based on the
appraisal and decide how to tackle poor performance.