Performance Management - : DR GB Urs, Prof & Hod, Ai 1

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Performance Management –

Performance appraisal (PA) – Introduction – Meaning – Need –


Purpose – Objectives – Contents of PAS – Appraisers and
different methods of appraisal – Uses of performance
appraisal – Limitations and problems of performance
appraisal – 360° Appraisal – Post appraisal feedback.

Dr GB Urs, Prof & HoD, AI 1


Definition
PA is a method of evaluating the behavior of employees in the work spot, normally
including both the qualitative and quantitative aspects of job performance.

Meaning & core issues of PA


• In order to find out, if the employee is worthy of continued employment or not; so
also to devise the response the management;
• Degree of accomplishment of the tasks
• Fulfilling the job demands
• Is measured in terms of results (& not efforts)
• Also implies the employee’s future level of effort, activities, results and task
direction.
• The potential for development is also taken into consideration

Characteristics of PA
• PA is systematic description of an employee’s job relevant issues – SWOT
• Basic purpose is to know ‘how well’ is the performance and plan for G & D
• PA is periodical, systemati, continuous and structured
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Need (for PA)
• Provides info about the performance, and has a bearing on decision of the
management towards the particular employee
• Provides info about level of achievement, behavior of subordinates; thereby
rectifying the performance deficits, apply CAPA, achieve the set goals.
• Provides info for diagnosing deficits in the employee – skill, knowledge levels,
etc.
• To determine T & D programs to fulfill these gaps – so as to achieve G & D.
• Provide info to counsel / feedback the employee
• To prevent grievances and indisciplinary activities.

Purpose – (Administrative & Developmental)


Administrative
• Document HR decisions with regard to PA
• Determine the management decisions about every employee (promotion,
transfers, change in assignments)
• Identify poor performers, their areas and decide (T & D, retention, termination,
bench, layoffs, retire)
• Validate selection criteria relating performance to selection tests and interview
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Administrative (Cont)
• Meet legal requirements
• T & D programs – evaluation of the impact & apply CAPA
• HR Planning
• Helpful in deciding on salary / compensation and other perks, benefits.

Developmental purposes
• Provides Feedback
• Identify skill sets, core competency / ies, strengths and weaknesses
• Recognize and record performance levels
• Assist, help in identify, set, motivate and achieve goals – individual, group & Org.
• Evaluate goal achievement
• Identify training needs, plan T & D programs, implement, follow up.
• Reinforce authority / heirarchy structure
• Provides space to ventilate / vocalize concerns
• Improve communication
• Platform to help employees

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Objectives
• Helps to create and sustain a org culture of excellence that inspires every
employees
• Match org objectives to individual aspirations
• Equip people with the skills necessary to perform their duties
• Specify career paths and goals
• Provide new challenges to rejuvenate plateauing careers
• Forge partnership with employees – to manage their careers
• Empower employees to decide without the fear of failure
• Embed teamwork in all operational processes
• Allow the voices of workers closest to the customers – be heard
• De-bureaucratize the structure for free flow of info / communicate freely

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Contents of PA
• Contents will vary with the need / purpose of PA, types and level of employees.
• Has lot of bearing on the job analysis.
• Contribution to achievement of org. objectives (ROI, Cost saving, Production etc)
• Behavior which measure observable physical actions, movements
• Behavior which measure job related results (deposits mobilized)
• Indivividual / group traits which are measured in terms of personal characteristics
in employee’s job activities.

Appraisers and different methods of appraisal

Who is an appraiser ?
Is any person who has thorough knowledge about the job content, contents to be
appraised, standards of contents and observes a person at his job.

Characteristics of an appraiser
• Should be capable, skilled, experienced
• Conduct the assessment, prepare reports and judge
• Should be good counselor
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Types of appraisers
Supervisors, Peers, subordinates, Self, Customers, Service organizations,
Consultants, Teams / Groups.

Methods of Appraisals (for students)

Three types – Trait, behavioral & results methods.

Trait methods - Graphic rating scale, Ranking, Paired comparison, Forced


distribution, Checklists, Essay / Free form, Group, Confidential reports.

Behavioral methods – Behavioral checklist, Critical Incident, Behaviorally anchored


rating scale, Behavioral observation scales, Assessment Centre, Psychological
appraisal.

Results methods – Productivity measures, Balanced scorecard, HR accounting,


MBO.

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Uses of PA
1. Performance improvement
2. Compensation Adjustments
3. Placement decisions
4. T & D needs
5. Career planning & development
6. Staffing process deficiencies
7. Information Inaccuracies
8. Job Design errors (& CAPA)
9. Equal employment opportunity
10. External challenges
11. Feedback to HR

Limitations / problems of PA
Three areas –
• Rating biases,
• Failure of supervisors &
• Management perspective.
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I. Rating bias
• Halo effect,
• Errors of central tendency,
• Leniency & strictness,
• Personal prejudice,
• Recency effect,
• Absence of interrater reliability,

II. Failure of supervisors


• Failure to conduct PA interviews,
• Subjective,
• Less reliability and validity of the PA techniques,
• Potential appraisal is based on guess work,
• PA is conducted in a few minutes,
• Lack tack in offering constructive suggestions,
• Confused due to many objectives of PA,

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III. Management perspective
• -ve ratings affect IPR’s & Industrial relations systems
• Influence of external environmental factors & uncontrollable internal factors
• Feedback and post appraisal interview may impact production and so on.
• Relationship between PA and decisions taken by management – do not match
• Management emphasis on punishment rather than development of an employee
in PA.

3600 Appraisal
• Appraisal by all concerned to get ‘total & complete’ info about the employee is
known as 3600 Appraisal.
• The all concerned may include - Supervisors, Peers, subordinates, Self,
Customers, Service organizations, Consultants, Teams / Groups.

Post Feedback Feedback / Interview


• Very important part of PA
• Last part of PA
• Helps explain the PA to the employee concerned.
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Explain the PA – completely
• Ratings,
• Traits & Behaviors,
• Standards,
• Goals,
• Rating scales,
• Internal & external environment causes for low level of performance,
• Resources responsible for the present performance)
• Review standards
• Set new standards
• Helps appraiser to offer his suggestions
• Help, guide and coach the employee for G & D

Actual uses of PA
• Inform employees – about reality about themselves
• Clarify the exact need of the org in relation to the employee
• To plan for G & D
• Strengthen subordinate – superior relationship
• Helps to voice / express themselves.
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