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    PerformanceAppraisals

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    Contents

    1. Understanding Performance Appraisal

    2. Characteristics and Objectives of PA

    3. Benefits to Company & Employees4. Performance Appraisal Design

    5. Problems in PA

    6. Performance Appraisal Process

    7. Performance Appraisal Methods

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    Performance Appraisal

    Performance Appraisal (PA) refers

    to all those procedures that are

    used to evaluate the personality,performance, potential, of an

    Organizations' Human Resources.

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    The Questions?

    Why do we measure performance?

    What are the effective

    performance appraisal systems?

    How do we measure performance?

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    Characteristics of

    Performance Appraisals

    It is a step by step process

    It examine the employee strengths and

    weaknesses Scientific and objective study

    Ongoing and continuous process

    Secure information for making correct

    decisions on employees

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    PA - Needs and Objectives

    Provide feedback about employees

    Provide database

    Diagnose the S & W of individuals

    Provide coaching, counseling, careerplanning to subordinates

    Develop positive relation and reducegrievance

    Facilitates research in personnelmanagement

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    Appraisal Benefits - Company

    Appraisals offer the company:

    Documentation

    Employee Development

    Feedback

    Legal protectionMotivation system

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    Appraisal Benefits - Employees

    Appraisals offer employees:

    Direction

    Feedback

    Input

    Motivation

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    Why Appraisals Are Important ?

    Recognize accomplishments

    Guide progress

    Improve performanceReview performance

    Set goals

    Identify problemsDiscuss career advancement

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    Steps in performance appraisal

    Establishing job standards

    Designing an appraisal programme

    Appraise performance

    Performance interview

    Use appraisal data

    For appropriate purpose

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    Process of Performance Appraisals

    Setting

    performance

    standardsTaking corrective

    measures

    Discussingresults

    Comparing

    standards

    Measuringstandards

    Communicating

    standards

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    Issues in Appraisal Design Process

    Appraisal Design?

    Formal and informal

    Whose performance?

    Who are the raters?

    What problems?

    How to solve?

    What to evaluate?

    When to evaluate?

    What methods?

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    Performance Levels to evaluate?

    (Philip Model)

    Problemchildren

    Planned

    separation

    Stars

    Social

    citizen

    H

    L H

    L

    Potential

    Performance

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    How PA contribute to Companys

    competitive advantage?

    Improving

    performance

    Making correctdecision

    Ensuring legal

    competenceMinimize

    Dissatisfaction levels

    Values and behavior

    Competitive

    advantage

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    Problems in performance appraisal1. Errors In rating

    Halo effects

    Stereotyping Central tendency

    Constant error

    Personal bias Spill over effect

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    Problems in performance appraisal

    (Contd)2. Incompetence

    3. Negative approach

    4. Multiple objectives

    5. Resistance

    6. Lack of knowledge

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    Essentials of an effective appraisal system

    Mutual trust

    Clear objectives

    Standardizations

    Training Job relatedness

    Documentation

    Feedback and participation

    Individual differences Post appraisal review

    Review and appeal

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    Discrimination

    Failure to communicate standards

    Failure to give timely feedback

    Failure to allow employees to correctperformance

    Inconsistency in measuring performance

    Failure to document performanceobjectively

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    Appraisal Forms

    Define performance expectations

    Describe measurement tools

    Use a rating system

    Cover specific examples

    Set measurable goals

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    Document Performance

    Make sure documentation is objective

    Document performance of all employees

    Provide complete and accurateinformation

    Document performance on a regular

    basis

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    Set Goals.

    Based on job requirements

    Realistic

    Measurable

    Observable

    Challenging

    Prioritized

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    Employees Inputs

    Employees take an active role in:

    Setting goalsDesigning action plans

    Identifying strengths and weaknesses

    Employees participate in the PA

    meeting

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    Preparing for Performance Appraisal

    Preparation for the interview begins withcompleting the appraisal form.

    The Appraiser should allow enough timeto complete the form carefully andthoughtfully.

    The Appraiser should think about howthe employee is likely to react to the

    appraisal and should plan how to handlethe employees reaction.

    Also be ready with some ideas for how tocorrect problems noted in the appraisal.

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    Preparation

    Notify the employee ahead of the timeof the interview.

    Arrange for a private place to hold

    the interview.

    Make arrangements to prevent

    interruptions.

    This is a very important event for

    both the supervisor and the

    employee--treat it as such.

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    Guidelines for Conducting the Interview

    Begin the interview session by an attempt to put theemployee at ease.

    A refreshment and small talk may help break the ice.

    Review the employees self-evaluation first, if there is one. Ask for reasons for the various ratings.

    Then the supervisor describes his or her evaluation of theemployee.

    Start with an overall impression, then explain the contents of the

    appraisal forms. Most employees are waiting for the bad news, so it is probably

    most effective to describe areas for improvement first.

    Then describe the employees strengths.

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    Start the Meeting

    Start with totally out of the topic /subject.

    Find out personal details / updates

    Lay out agenda

    Talk about colleagues, work etc.,

    Encourage appraisee inputs Give good news first, always.

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    During the MeetingReview performance

    Based on previous goals

    Noting strengths and accomplishments

    Identifying areas for improvement

    Set goals: Based on company goals

    Focus on areas that need improvement

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    End the Meeting

    Encourage good performance

    Lay out action plan for next review cycle

    Communicate outcome of goals did notmeet

    Confirm mutual understanding

    Share the deficiencies, if any, in more

    subtle way.

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    Tips to have effective Review meetings

    Focus on the overall performance, not therecent incidents.

    Recall the whole year / periods

    contributions, both positive and negative. Share positives - Always

    Give objective examples

    I

    nvite response Listen actively

    Create we mentality

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    Continuous Feedback

    Formal appraisals

    Informal appraisals Open communication

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    Recognize & Reward

    Good Performance

    Verbal

    Public

    Tangible

    Monetary

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    Identify Poor Performance

    Act early

    Take the right approach

    Deal with employee reaction

    Handle continued poor performance

    Be careful while reviewing highlyemotional employees

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    Discipline Poor Performance

    Recognize problems, in detail.

    Talk to the employees, at length. Help them to get over the problems, if

    any.

    Follow company policy in takingdiscipline actions, if needed.

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    Key Points to Remember

    You must conduct objective appraisals on ascheduled basis.

    Appraisals tell employees how theyre doing andhow they can improve.

    Appraisals help create a system of motivationand rewards based on performance.

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    Performance

    Appraisal

    Meth

    ods

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    Performance Appraisal Meth

    ods Individual Evaluation Methods

    Confidential report

    Essay evaluation

    Critical incidents

    Checklists

    Graphic rating scale

    Behaviorally anchored rating scale MBO

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    Critical-Incident Appraisal

    Critical-incident Appraisal: A performance appraisal inwhich the supervisor keeps a record of incidents that

    show positive and negative ways the employee has acted;

    the supervisor uses this record to assess the employees

    performance.

    To conduct a critical-incident appraisal, the supervisorkeeps a written record of incidents that show positive andnegative ways in which the employee has acted. The record should include dates, people involved, actions taken,

    and any other details that are relevant.

    At the time of the appraisal, the supervisor reviews the record toreach an overall evaluation of the employees behavior.

    During the appraisal interview, the employee has a chance torespond to each of the incidents recorded.

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    Critical Incident method

    Ex: A fire, sudden breakdown, accident

    Workers reaction scale

    A informed the supervisor immediately 5

    B Become anxious on loss of output 4

    C tried to repair the machine 3

    D Complained for poor maintenance 2E was happy to avoid work 1

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    Checklist method

    Simple checklist methodWeighted checklist method

    Forced choice method

    Simple checklist method:Is employee regular Y/N

    Is employee respected by subordinate Y/N

    Is employee helpful Y/N

    Does he follow instruction Y/N

    Does he keep the equipment in order Y/N

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    Weighted checklist method

    Weightage Performance Rating(scale 1 to 5 )

    1. Regularity 10%

    2. Loyalty 10%3. Willing to help 20%

    4. Quality of work 20%

    5. Working relationships 40%

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    Forced-Choice Approach

    Forced-choice Approach: A performance appraisal that presents the

    appraiser with sets of statements describing employee behavior; the

    appraiser must choose which statement is most characteristic of the

    employee and which is least characteristic.

    This type of appraisal form gives the supervisor sets of statementsdescribing employee behavior.

    For each set of statements, the supervisor must select the one

    that is most and the one that is least characteristic of the

    employee.

    These questionnaires prevent the supervisor from saying only

    positive things about employees. It is used when an organization

    finds that supervisors have been rating an unbelievably high

    proportion of employees as above average.

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    Forced Choice Method

    Criteria Rating

    1.Regularity on the job

    Always regularInform in advance for delay

    Never regular

    Remain absentNeither regular nor irregular

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    Graphic Rating Scale Graphic Rating Scale: A performance appraisal that rates the degree to

    which the employee has achieved various characteristics.

    The graphic rating scale is the most common type of appraisal used.

    Various characteristics such as job knowledge or punctuality are ratedby the degree of achievement.

    The rate usually receives a score of 1 to 5,with 5 representingexcellent performance.

    Some forms allow for additional comments.

    The advantage of this type of appraisal is that it is relatively easy to use.

    However, the ratings themselves are subjective.

    What one supervisor considers excellent may seem just

    average to someone else.

    Also, many supervisors tend to rate everyone as being at least a

    little bit above average.

    Additional descriptive information is an attempt to overcome these

    problems.

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    Graphic Rating Scale

    Employee name_________ Deptt_______

    Raters name ___________ Date________

    ------------------------------------------------------------------------

    Exclnt. Good Acceptable Fair Poor

    5 4 3 2 1 _ 1. Dependability

    2. Initiative

    3. Overall output

    4. Attendance

    5. Attitude

    6. Cooperation

    Total score

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    Behaviorally Anchored Rating Scales

    Behaviorally Anchored Rating Scales: A performance appraisalin which the employee is rated on scales containing statementsdescribing performance in several areas.

    This is a method of performance appraisal that is tailored to theorganization and positions within that organization.

    Some organizations pay behavioral scientists or organizational

    psychologists to create behaviorally anchored rating scales.

    These scales rate employee performance in several areas.

    The supervisor selects the statement that best describes how theemployee performs.

    Each job title in the organization has a different set of rating statements.

    The advantage of using this technique is that it is tailored to theorganizations objectives for employees.

    It also tends to be less subjective than some other approaches.

    However, developing the scales is time-consuming and therefore relativelyexpensive.

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    BARS( Behaviorally Anchored Rating Scale)

    Step 1. Identify critical incidents

    Step 2. Select performance dimension

    Step 3. Retranslate the incidents

    Step 4. Assign scales to incidents

    Step 5. Develop final instrument

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    Management by Objectives (MBO)

    In organizations where MBO is used to set

    goals and objectives for employees, the

    supervisor will use this approach for

    performance appraisal also. The appraisal is based on whether or not the

    employee has met his or her objectives.

    The advantage is that employees know what to

    expect.

    The supervisor focuses on results rather than

    more subjective criteria.

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    MBO Process

    Set organizational goals

    Defining performance target

    Performance review feedback

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    Group Appraisal

    Ranking

    Paired comparison

    Forced distribution

    Performance tests Field review technique

    Performance Appraisal Methods

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    Ranking method

    Employee Rank

    A 2

    B 1

    C 3

    D 5

    E 4

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    Forced Distribution Method

    10% 20% 40% 20% 10%

    poor Below

    average

    average good Excellent

    No.

    of

    employees

    Force distribution curve

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    360* Appraisal Process 360-degree Feedback: Performance appraisal

    that combines assessment from several sources.

    Because the supervisor cannot know all of anemployees behaviors and their impact on others

    in the organization, the supervisor may combinehis or her appraisal with self-assessments by theemployee or with appraisals by peers orsubordinates.

    Combining several sources of appraisals is called 360-degreefeedback.

    The self-assessment may be done before the interview.

    Then the supervisor and employee can compare theemployees appraisal with his or her own evaluation.

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    360* Appraisal Process

    Performance subordinate peers superior customer

    Dimension

    Leadership ^ ^

    Communication ^ ^

    Interpersonal skills ^ ^

    Decision making ^ ^ ^

    Technical skills ^ ^ ^

    Motivation ^ ^ ^

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    Performance Appraisal

    Guidelines forDifferent Levels

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    For Senior Management

    Return on capital employed

    Contribution to community

    development

    Degree of upward communication

    from middle-level executives

    Degree of growth and expansion ofenterprise.

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    for Middle Level Managers

    Departmental performance

    Coordination among employees

    Degree of upward communication fromsupervisors

    Degree of clarity about corporate goals

    and policies

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    For Junior Level Managers

    Quality and quantity of output in a givenperiod

    Labor cost per unit of output in a given

    period Material cost per unit in a given period

    Rate of absenteeism and turnover of

    employees No of accidents in a given period

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    Any Questions ???