Competency based performance appraisal

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I. Contents of getting competency based performance appraisal

==================Competency management systems allow employers to evaluate employees' performance. Use of these systems allows managers and supervisors to identify gaps, deploy remedial training, recruit staff and compensate current employees appropriately. Developing competency-based performance management systems typically involves creating comprehensive competency models for all jobs and assessing employees against those models during annual performance reviews. Employers may use these systems for all staff or restrict their use for only salaried employees. By identifying core competencies that align with the companys mission, vision and goals, management can consistently and fairly rate employees who contribute to the bottom line. Successful organizations also encourage employees to establish personalized objectives that allow them to develop their abilities while supporting company goals.Advantages

Incorporating competencies into performance management activities demonstrates that companies connect achievement to compensation, align employee work to strategic goals and objectives, and reinforce behavior that leads to excellence. In addition to traditional business metrics, such as revenue and sales, employers who use competency-based performance management systems can quantify and qualify the work done by employees. For example, using comprehensive assessments, such as 360-degree reviews, employers gather extensive data about an employees work. This also allows company executives to more effectively manage resources and designate individuals to take over leadership positions.Challenges

Defining the skills and behavior required to complete a task successfully requires time, effort and coordination between multiple sources. Getting agreement on the relevancy of a particular competency, such as business acumen, communication or team management, may require numerous meetings and discussions to get consensus among multiple company executives. Defining the process for assessing individuals against the model may also take time. Additionally, conducting competency-based performance reviews tends to be time-consuming.

Alignment

Successful companies align competencies defined in the performance management system with the companys strategic objectives. For example, companies that want to improve customer satisfaction and loyalty may require employee competence in personal effectiveness competencies, such as communication, influencing and integrity. These skills involve speaking, writing and listening effectively to co-workers, partners and customers. Formally linking employee development to performance management systems ensures that knowledge transfer, succession planning and employee training needs get met as part of daily operations rather than remedial actions taken only when problems occur. Career development activities contribute to improved employee morale and retention. This tends to reduce absenteeism as well.Implementation

Implementing a competency-based performance management system typically begins by analyzing the business environment and listing the job roles needed to achieve strategic goals. By identifying the skills and behavior required to perform these jobs, effective HR professionals develop competency models. They publish these models on intranet pages, distribute newsletters and run workshops to explain how these frameworks can be used by employees for career development. Then, employees create their development plans aligned with the companys mission. When managers conduct performance reviews and enter data into the performance management system, they can evaluate each employee fairly and consistently. Many systems also permit employees to conduct a self-assessment.

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III. Performance appraisal methods

1. Essay Method

In this method the rater writes down the employee description in detail within a number of broad categories like, overall impression of performance, promoteability of employee, existing capabilities and qualifications of performing jobs, strengths and weaknesses and training needs of the employee. Advantage It is extremely useful in filing information gaps about the employees that often occur in a better-structured checklist. Disadvantages It its highly dependent upon the writing skills of rater and most of them are not good writers. They may get confused success depends on the memory power of raters.

2. Behaviorally Anchored Rating Scales

statements of effective and ineffective behaviors determine the points. They are said to be behaviorally anchored. The rater is supposed to say, which behavior describes the employee performance. Advantages helps overcome rating errors. Disadvantages Suffers from distortions inherent in most rating techniques.

3. Rating Scale

Rating scales consists of several numerical scales representing job related performance criterions such as dependability, initiative, output, attendance, attitude etc. Each scales ranges from excellent to poor. The total numerical scores are computed and final conclusions are derived. Advantages Adaptability, easy to use, low cost, every type of job can be evaluated, large number of employees covered, no formal training required. Disadvantages Raters biases

4. Checklist method

Under this method, checklist of statements of traits of employee in the form of Yes or No based questions is prepared. Here the rater only does the reporting or checking and HR department does the actual evaluation. Advantages economy, ease of administration, limited training required, standardization. Disadvantages Raters biases, use of improper weighs by HR, does not allow rater to give relative ratings

5.Ranking Method

The ranking system requires the rater to rank his subordinates on overall performance. This consists in simply putting a man in a rank order. Under this method, the ranking of an employee in a work group is done against that of another employee. The relative position of each employee is tested in terms of his numerical rank. It may also be done by ranking a person on his job performance against another member of the competitive group.Advantages of Ranking Methodi. Employees are ranked according to their performance levels.ii. It is easier to rank the best and the worst employee.Limitations of Ranking Methodi. The whole man is compared with another whole man in this method. In practice, it is very difficult to compare individuals possessing various individual traits.ii. This method speaks only of the position where an employee stands in his group. It does not test anything about how much better or how much worse an employee is when compared to another employee.iii. When a large number of employees are working, ranking of individuals become a difficult issue.iv. There is no systematic procedure for ranking individuals in the organization. The ranking system does not eliminate the possibility of snap judgements.

6. Critical Incidents Method

The approach is focused on certain critical behaviors of employee that makes all the difference in the performance. Supervisors as and when they occur record such incidents. Advantages Evaluations are based on actual job behaviors, ratings are supported by descriptions, feedback is easy, reduces recency biases, chances of subordinate improvement are high. Disadvantages Negative incidents can be prioritized, forgetting incidents, overly close supervision; feedback may be too much and may appear to be punishment.

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