Appraising and improving performance

By- Prof Sachin Batra

Appraising and Improving Performance


Performance Appraisal Programs

• Performance Appraisal– A process, typically performed annually by a

supervisor for a subordinate, designed to help employees understand their roles, objectives, expectations, and performance success.

• Performance management– The process of creating a work environment in

which people can perform to the best of their abilities.


Performance Appraisal

Appraisal ProgramsAppraisal Programs

AdministrativeAdministrative DevelopmentalDevelopmental

CompensationCompensation Ind. EvaluationInd. Evaluation

Job EvaluationJob Evaluation

Admin. SupportAdmin. Support

Training Training

Career PlanningCareer Planning


Figure 8–1 Purposes for Performance Appraisal


Reasons Appraisal Programs Sometimes Fail

• Lack of top-management information and support

• Unclear performance standards• Rater bias• Too many forms to complete• Use of the appraisal program for

conflicting (political) purposes.


Managerial Issues Concerning Appraisals

1. There is little face-to-face discussion between the manager and the employee being appraised.

2. The relationship between the employee’s job description and the criteria on the appraisal form isn’t clear.

3. Managers feel that little or no benefit will be derived from the time and energy spent in the process, or they are concerned only with bad performances.

4. Managers dislike the face-to-face confrontation of appraisal interviews.


Managerial Issues Concerning Appraisals (cont’d)

5. Managers are not sufficiently adept at rating employees or providing them with appraisal feedback.

6. The judgmental role of appraisal conflicts with the helping role of developing employees.

7. The appraisal is just a once-a-year event, and there is little follow-up afterward.


Figure 8–3 Establishing Performance Standards


Strategic Relevance

Strategic Relevance

Individual standards directly relate to strategic goals.

Individual standards directly relate to strategic goals.

Criterion Deficiency

Criterion Deficiency

Standards capture all of an individual’s contributions.

Standards capture all of an individual’s contributions.

Criterion Contamination

Criterion Contamination

Performance capability is not reduced by external factors.

Performance capability is not reduced by external factors.

Reliability(Consistency)

Reliability(Consistency)

Standards are quantifiable, measurable, and stable.

Standards are quantifiable, measurable, and stable.

Performance Standards Characteristics


Figure 8–4 Alternative Sources of Appraisal

Source: From The Wall Street Journal—permission, Cartoon Features Syndicate.


Sources of Performance Appraisal

• Manager and/or Supervisor– Appraisal done by an employee’s manager and reviewed

by a manager one level higher.• Self-Appraisal

– Appraisal done by the employee being evaluated, generally on an appraisal form completed by the employee prior to the performance interview.

• Subordinate Appraisal– Appraisal of a superior by an employee, which is more

appropriate for developmental than for administrative purposes.



• Peer Appraisal– Appraisal by fellow employees, compiled into a

single profile for use in an interview conducted by the employee’s manager.

– Why peer appraisals are used more often:1. Peer ratings are simply a popularity contest.2. Managers are reluctant to give up control over the

appraisal process.3. Those receiving low ratings might retaliate against their

peers.4. Peers rely on stereotypes in ratings.



• Team Appraisal– based on TQM concepts, that recognizes team

accomplishment rather than individual performance

• Customer Appraisal– A performance appraisal that, like team appraisal,

is based on TQM concepts and seeks evaluation from both external and internal customers


Figure 8–5 Pros and Cons of 360-Degree Appraisal

Sources: Compiled from David A. Waldman, Leanne E. Atwater, and David Antonioni, “Has 360-Degree Feedback Gone Amok?” Academy of Management Executive 12, no. 2 (May 1998): 86–94; Bruce Pfau, Ira Kay, Kenneth Nowak, and Jai Ghorpade, “Does 360-Degree Feedback Negatively Affect Company Performance?” HRMagazine 47, no. 6 (June 2002): 54–59; Maury Peiperl, “Getting 360-Degree Feedback Right,” Harvard Business Review 79, no. 1 (January 2001): 142–47; Joyce E. Bono and Amy E. Colbert, Understanding Responses to Multi-Source Feedback: The Role of Core Self-Evaluations,” Personnel Psychology 58, no. 1 (Spring 2005): 171–205.

• PROS The system is more comprehensive in that responses are gathered

from multiple perspectives.

Quality of information is better. (Quality of respondents is more important than quantity.)

It complements TQM initiatives by emphasizing internal/external customers and teams.

It may lessen bias/prejudice since feedback comes from more people, not one individual.

Feedback from peers and others may increase employee self-development.


Figure 8–5 Pros and Cons of 360-Degree Appraisal (cont’d)

Sources: Compiled from David A. Waldman, Leanne E. Atwater, and David Antonioni, “Has 360-Degree Feedback Gone Amok?” Academy of Management Executive 12, no. 2 (May 1998): 86–94; Bruce Pfau, Ira Kay, Kenneth Nowak, and Jai Ghorpade, “Does 360-Degree Feedback Negatively Affect Company Performance?” HRMagazine 47, no. 6 (June 2002): 54–59; Maury Peiperl, “Getting 360-Degree Feedback Right,” Harvard Business Review 79, no. 1 (January 2001): 142–47; Joyce E. Bono and Amy E. Colbert, Understanding Responses to Multi-Source Feedback: The Role of Core Self-Evaluations,” Personnel Psychology 58, no. 1 (Spring 2005): 171–205.

• CONS The system is complex in combining all the responses.

Feedback can be intimidating and cause resentment if employee feels the respondents have “ganged up.”

There may be conflicting opinions, though they may all be accurate from the respective standpoints.

The system requires training to work effectively.

Employees may collude or “game” the system by giving invalid evaluations to one another.

Appraisers may not be accountable if their evaluations are anonymous.


360-Degree Performance Appraisal System Integrity Safeguards

• Assure anonymity. • Make respondents accountable.• Prevent “gaming” of the system. • Use statistical procedures. • Identify and quantify biases.


Training Performance Appraisers

Recency errorsRecency errors

Leniency or strictness errorsLeniency or strictness errors

Common rater-related errorsCommon rater-related errors

Error of central tendencyError of central tendency

Similar-to-me errorsSimilar-to-me errors

Contrast and halo errorsContrast and halo errors


Rater Errors

• Error of Central Tendency– A rating error in which all employees are rated about

average.• Leniency or Strictness Error

– A rating error in which the appraiser tends to give all employees either unusually high or unusually low ratings.

• Recency Error– A rating error in which appraisal is based largely on an

employee’s most recent behavior rather than on behavior throughout the appraisal period.


Rater Errors

• Contrast Error– A rating error in which an employee’s evaluation is

biased either upward or downward because of comparison with another employee just previously evaluated.

• Similar-to-Me Error– An error in which an appraiser inflates the

evaluation of an employee because of a mutual personal connection.


Rater Errors: Training and Feedback

• Rating Error Training– Observe other managers making errors– Actively participate in discovering their own errors– Practice job-related tasks to reduce the errors they

tend to make• Feedback Skills Training

– Communicating effectively– Diagnosing the root causes of performance problems– Setting goals and objectives


Performance Appraisal Methods

Trait Methods

Trait Methods

Graphic Rating Scale

Graphic Rating Scale

Mixed Standard Scale

Mixed Standard Scale

Forced-ChoiceForced-Choice

EssayEssay


Trait Methods

• Graphic Rating-Scale Method– A trait approach to performance appraisal

whereby each employee is rated according to a scale of individual characteristics.

• Mixed-Standard Scale Method– An approach to performance appraisal similar to

other scale methods but based on comparison with (better than, equal to, or worse than) a standard.


Highlights in HRM 2

Graphic Rating Scale with Provision for Comments


Highlights in HRM 3

Example of a Mixed-Standard Scale


Trait Methods

• Forced-Choice Method– Requires the rater to choose from statements

designed to distinguish between successful and unsuccessful performance.

– 1. ______ a) Works hard _____ b) Works quickly– 2. ______ a) Shows initiative _____ b) Is responsive to

customers– 3. ______ a) Produces poor quality _____ b) Lacks good work

habits

• Essay Method– Requires the rater to compose a statement

describing employee behavior.

Appraising and improving performance

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