Presented By-

Swayam Gupta

08 BBA 2013

Performance Appraisal

Meaning

Objectives

Benefits

Methods

Job Evaluation

Meaning

Methods

In simple terms, Performance Appraisal may be understood as the assessment of individual’s performance in a systematic way, the performance being measured against such factors as job knowledge, quality and quantity of output, initiative, leadership abilities, supervision, dependability, co-operation, judgment, versatility and health. Assessment should not be confined to past performance alone. Potentials of the employee for future performance must also be assessed.

A formal definition of Performance Appraisal is:

It is the systematic evaluation of the individual with respect to his/her performance on the job and his/her potential for development.

To maintain records in order to determine

compensation packages, wage structure,

salaries etc.

To identify the strengths and weaknesses of

employees to place right men on right job.

To maintain and assess the potential present in

a person for further growth and development.

To provide a feedback to employees regarding

their performance and related status.

To review and retain the promotional and

other training programmes.

It helps the supervisors to chalk out the promotion programmes for efficient employees.

It helps the supervisors to frame training policies and programmes.

It helps to analyse strengths and weaknesses of employees so that new jobs can be designed for efficient employees.

It also helps in framing future development programmes.

The subordinates can also understand and create a trust and confidence in superiors.

It also helps in maintaining cordial and congenial labour management relationship.

It develops the spirit of work and boosts the morale of employees.

Broadly all methods of appraisals can be

divided into two different categories:

Past Oriented Methods

Future Oriented Methods

Rating Scales: 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.

Checklist: 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.

Forced Choice Method: The series of statements arranged in the blocks of two or more are given and the rater indicates which statement is true or false. The rater is forced to make a choice. HR department does actual assessment.

Field Review Method: This is an appraisal done by someone outside employees’ own department usually from corporate or HR department.

Performance Tests & Observations: This is based on the test of knowledge or skills. The tests may be written or an actual presentation of skills. Tests must be reliable and validated to be useful.

Comparative Evaluation Method: These are collection of different methods that compare performance with that of other co-workers. The usual techniques used may be ranking methods and paired comparison method.

Ranking Methods: Superior ranks his worker based on merit, from best to worst. However how best and why best are not elaborated in this method. It is easy to administer and explanation.

Paired Comparison Methods: In this method each employee is rated with another employee in the form of pairs. The number of comparisons may be calculated with the help of a formula as N x (N-1) / 2

Management By Objectives: It means management by objectives and the performance is rated against the achievement of objectives stated by the management.

Psychological Appraisals: These appraisals are more directed to assess employees potential for future performance rather than the past one. It is done in the form of in-depth interviews, psychological tests, and discussion with supervisors and review of other evaluations.

360-Degree Feedback: It is a technique which is systematic collection of performance data on an individual group, derived from a number of stakeholders like immediate supervisors, team members, customers, peers and self.

A job evaluation is a systematic way of

determining the value/worth of a job in

relation to other jobs in an organization.

It tries to make a systematic comparison

between jobs to assess their relative worth

for the purpose of establishing a rational

pay structure.

There are primarily three methods of job

evaluation:

Ranking Method,

Classification Method,

Factor comparison Method

Point Method.

Perhaps the simplest method of job evaluation

is the ranking method. According to this

method, jobs are arranged from highest to

lowest, in order of their value or merit to the

organization.

Jobs can also be arranged according to the

relative difficulty in performing them.

According to this method, a predetermined

number of job groups or job classes are

established and jobs are assigned to these

classifications.

This method places groups of jobs into job

classes or job grades. Separate classes may

include office, clerical, managerial,

personnel, etc.

This method is widely used and is considered to be one of the reliable and systematic approach for job evaluation in mid and large size organisations.

Under this method, each job is ranked according to a series of factors. These factors include mental effort, physical effort, skill needed, responsibility, working conditions etc.

Pay will be assigned in this method by comparing the weights of factors required for each job.

Jobs are expressed in terms of key factors.

Points are assigned to each factor after

prioritizing each factor in order of

importance.

The points are summed up to determine

the wage rate for the job.

Jobs with similar point totals are placed in

similar pay grades.

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