What is Performance appraisal?

Hi all,
I am new one and student. I want to be friends with you all.

I want to know about more performance appraisal- can anyone explain about it. Thanks

myalay
View Public Profile
Send a private message to myalay
Find all posts by myalay

#2 (permalink)
22-10-2007, 10:06 AM
Join Date: Sep 2007 Said Thanks: 0
sudhanshu112june Location: Delhi Thanked 0 Times in 0 Posts
Posts: 49

Re: What is Performance appraisal?

Performance Appraisal

The history of performance appraisal is quite brief. Its roots in the early 20th century can
be traced to Taylor's pioneering Time and Motion studies. But this is not very helpful, for
the same may be said about almost everything in the field of modern human resources
management.

As a distinct and formal management procedure used in the evaluation of work

performance, appraisal really dates from the time of the Second World War - not more
than 60 years ago.

Yet in a broader sense, the practice of appraisal is a very ancient art. In the scale of
things historical, it might well lay claim to being the world's second oldest profession!

There is, says Dulewicz (1989), "... a basic human tendency to make judgements about
those one is working with, as well as about oneself." Appraisal, it seems, is both
inevitable and universal. In the absence of a carefully structured system of appraisal,
people will tend to judge the work performance of others, including subordinates,
naturally, informally and arbitrarily.
The human inclination to judge can create serious motivational, ethical and legal
problems in the workplace. Without a structured appraisal system, there is little chance of
ensuring that the judgements made will be lawful, fair, defensible and accurate.

Performance appraisal systems began as simple methods of income justification. That is,
appraisal was used to decide whether or not the salary or wage of an individual employee
was justified.

The process was firmly linked to material outcomes. If an employee's performance was
found to be less than ideal, a cut in pay would follow. On the other hand, if their
performance was better than the supervisor expected, a pay rise was in order.

Little consideration, if any, was given to the developmental possibilities of appraisal. If

was felt that a cut in pay, or a rise, should provide the only required impetus for an
employee to either improve or continue to perform well.

Sometimes this basic system succeeded in getting the results that were intended; but
more often than not, it failed.

For example, early motivational researchers were aware that different people with
roughly equal work abilities could be paid the same amount of money and yet have quite
different levels of motivation and performance.

These observations were confirmed in empirical studies. Pay rates were important, yes;
but they were not the only element that had an impact on employee performance. It was
found that other issues, such as morale and self-esteem, could also have a major
influence.

As a result, the traditional emphasis on reward outcomes was progressively rejected. In

the 1950s in the United States, the potential usefulness of appraisal as tool for motivation
and development was gradually recognized. The general model of performance appraisal,
as it is known today, began from that time.

Modern Appraisal
Performance appraisal may be defined as a structured formal interaction between a
subordinate and supervisor, that usually takes the form of a periodic interview (annual or
semi-annual), in which the work performance of the subordinate is examined and
discussed, with a view to identifying weaknesses and strengths as well as opportunities
for improvement and skills development.

In many organizations - but not all - appraisal results are used, either directly or
indirectly, to help determine reward outcomes. That is, the appraisal results are used to
identify the better performing employees who should get the majority of available merit
pay increases, bonuses, and promotions.

By the same token, appraisal results are used to identify the poorer performers who may
require some form of counseling, or in extreme cases, demotion, dismissal or decreases
in pay. (Organizations need to be aware of laws in their country that might restrict their
capacity to dismiss employees or decrease pay.)

Whether this is an appropriate use of performance appraisal - the assignment and

justification of rewards and penalties - is a very uncertain and contentious matter.

Controversy, Controversy
Few issues in management stir up more controversy than performance appraisal.

There are many reputable sources - researchers, management commentators,

psychometricians - who have expressed doubts about the validity and reliability of the
performance appraisal process. Some have even suggested that the process is so
inherently flawed that it may be impossible to perfect it (see Derven, 1990, for example).

At the other extreme, there are many strong advocates of performance appraisal. Some
view it as potentially "... the most crucial aspect of organizational life" (Lawrie, 1990).

Between these two extremes lie various schools of belief. While all endorse the use of
performance appraisal, there are many different opinions on how and when to apply it.

There are those, for instance, who believe that performance appraisal has many important
employee development uses, but scorn any attempt to link the process to reward
outcomes - such as pay rises and promotions.

This group believes that the linkage to reward outcomes reduces or eliminates the
developmental value of appraisals. Rather than an opportunity for constructive review
and encouragement, the reward-linked process is perceived as judgmental, punitive and
harrowing.

For example, how many people would gladly admit their work problems if, at the same
time, they knew that their next pay rise or a much-wanted promotion was riding on an
appraisal result? Very likely, in that situation, many people would deny or downplay
their weaknesses.

Nor is the desire to distort or deny the truth confined to the person being appraised. Many
appraisers feel uncomfortable with the combined role of judge and executioner.

Such reluctance is not difficult to understand. Appraisers often know their appraisees
well, and are typically in a direct subordinate-supervisor relationship. They work
together on a daily basis and may, at times, mix socially. Suggesting that a subordinate
needs to brush up on certain work skills is one thing; giving an appraisal result that has
the direct effect of negating a promotion is another.

The result can be resentment and serious morale damage, leading to workplace
disruption, soured relationships and productivity declines.

On the other hand, there is a strong rival argument which claims that performance
appraisal must unequivocally be linked to reward outcomes.

The advocates of this approach say that organizations must have a process by which
rewards - which are not an unlimited resource - may be openly and fairly distributed to
those most deserving on the basis of merit, effort and results.

There is a critical need for remunerative justice in organizations. Performance appraisal -

whatever its practical flaws - is the only process available to help achieve fair, decent and
consistent reward outcomes.

It has also been claimed that appraisees themselves are inclined to believe that appraisal
results should be linked directly to reward outcomes - and are suspicious and
disappointed when told this is not the case. Rather than feeling relieved, appraisees may
suspect that they are not being told the whole truth, or that the appraisal process is a
sham and waste of time.

The Link to Rewards

Research (Bannister & Balkin, 1990) has reported that appraisees seem to have greater
acceptance of the appraisal process, and feel more satisfied with it, when the process is
directly linked to rewards. Such findings are a serious challenge to those who feel that
appraisal results and reward outcomes must be strictly isolated from each other.

There is also a group who argues that the evaluation of employees for reward purposes,
and frank communication with them about their performance, are part of the basic
responsibilities of management. The practice of not discussing reward issues while
appraising performance is, say critics, based on inconsistent and muddled ideas of
motivation.

In many organizations, this inconsistency is aggravated by the practice of having separate

wage and salary reviews, in which merit rises and bonuses are decided arbitrarily, and
often secretly, by supervisors and managers.

sudhanshu112june
View Public Profile
Send a private message to sudhanshu112june
Find all posts by sudhanshu112june

#3 (permalink)
22-10-2007, 10:09 AM
Join Date: Sep 2007 Said Thanks: 0
sudhanshu112june Location: Delhi Thanked 0 Times in 0 Posts
Posts: 49

Re: What is Performance appraisal?

People differ in their abilities and their aptitudes. There is always some difference
between the quality and quantity of the same work on the same job being done by two
different people. Therefore, performance management and performance appraisal is
necessary to understand each employee’s abilities, competencies and relative merit and
worth for the organization. Performance appraisal rates the employees in terms of their
performance.

Performance appraisals are widely used in the society. The history of performance
appraisal can be dated back to the 20th century and then to the second world war when
the merit rating was used for the first time. An employer evaluating their employees is a
very old concept. Performance appraisals are an indispensable part of performance
measurement.

Performance appraisal is necessary to measure the performance of the employees and the
organization to check the progress towards the desired goals and aims.

The latest mantra being followed by organizations across the world being – “get paid
according to what you contribute” – the focus of the organizations is turning to
performance management and specifically to individual performance. Performance
appraisal helps to rate the performance of the employees and evaluate their contribution
towards the organizational goals. If the process of performance appraisals is formal and
properly structured, it helps the employees to clearly understand their roles and
responsibilities and give direction to the individual’s performance. It helps to align the
individual performances with the organizational goals and also review their performance.

Performance appraisal takes into account the past performance of the employees and
focuses on the improvement of the future performance of the employees. Here at
naukrihub, we attempt to provide an insight into the concept of performance appraisal,
the methods and approaches of performance appraisal, sample performance appraisal
forms and the appraisal softwares available etc. An attempt has been made to study the
current global trends in performance appraisal.

sudhanshu112june
View Public Profile
Send a private message to sudhanshu112june
Find all posts by sudhanshu112june

#4 (permalink)
22-10-2007, 10:14 AM
sudhanshu112june Join Date: Sep 2007 Said Thanks: 0
 Location: Delhi Thanked 0 Times in 0 Posts
Posts: 49

Re: What is Performance appraisal?

ESTABLISHING PERFORMANCE STANDARDS
The first step in the process of performance appraisal is the setting up of the standards
which will be used to as the base to compare the actual performance of the employees.
This step requires setting the criteria to judge the performance of the employees as
successful or unsuccessful and the degrees of their contribution to the organizational
goals and objectives. The standards set should be clear, easily understandable and in
measurable terms. In case the performance of the employee cannot be measured, great
care should be taken to describe the standards.

COMMUNICATING THE STANDARDS

Once set, it is the responsibility of the management to communicate the standards to all
the employees of the organization.

The employees should be informed and the standards should be clearly explained to the.
This will help them to understand their roles and to know what exactly is expected from
them. The standards should also be communicated to the appraisers or the evaluators and
if required, the standards can also be modified at this stage itself according to the
relevant feedback from the employees or the evaluators.

MEASURING THE ACTUAL PERFORMANCE

The most difficult part of the performance appraisal process is measuring the actual
performance of the employees that is the work done by the employees during the
specified period of time. It is a continuous process which involves monitoring the
performance throughout the year. This stage requires the careful selection of the
appropriate techniques of measurement, taking care that personal bias does not affect the
outcome of the process and providing assistance rather than interfering in an employees
work.

COMPARING THE ACTUAL WITH THE DESIRED PERFORMANCE

The actual performance is compared with the desired or the standard performance. The
comparison tells the deviations in the performance of the employees from the standards
set. The result can show the actual performance being more than the desired performance
or, the actual performance being less than the desired performance depicting a negative
deviation in the organizational performance. It includes recalling, evaluating and analysis
of data related to the employees’ performance.

DISCUSSING RESULTS

The result of the appraisal is communicated and discussed with the employees on one-to-
one basis. The focus of this discussion is on communication and listening. The results,
the problems and the possible solutions are discussed with the aim of problem solving
and reaching consensus. The feedback should be given with a positive attitude as this can
have an effect on the employees’ future performance. The purpose of the meeting should
be to solve the problems faced and motivate the employees to perform better.

DECISION MAKING

The last step of the process is to take decisions which can be taken either to improve the
performance of the employees, take the required corrective actions, or the related HR
decisions like rewards, promotions, demotions, transfers etc.

Purpose Of Performance Appraisal

Performance appraisal is being practiced in 90% of the organisations worldwide. Self-

appraisal and potential appraisal also form a part of the performance appraisal processes.

Typically, performance appraisal is aimed at:

To review the performance of the employees over a given period of time.

To judge the gap between the actual and the desired performance.

To help the management in exercising organizational control.

To diagnose the training and development needs of the future.

Provide information to assist in the HR decisions like promotions, transfers etc.

Provide clarity of the expectations and responsibilities of the functions to be performed

by the employees.

To judge the effectiveness of the other human resource functions of the organization such
as recruitment, selection, training and development.

To reduce the grievances of the employees.

Helps to strengthen the relationship and communication between superior – subordinates
and management – employees.
According to a recent survey, the percentage of organisations (out of the total
organisations surveyed i.e. 50) using performance appraisal for the various purposes are
as shown in the diagram below:

The most significant reasons of using performance appraisal are:

Making payroll and compensation decisions – 80%

Training and development needs – 71%

Identifying the gaps in desired and actual performance and its cause – 76%

Deciding future goals and course of action – 42%

Promotions, demotions and transfers – 49%

Other purposes – 6% (including job analysis and providing superior support, assistance
and counseling)

Approaches to Performance Development

Performance appraisal - Traditional approach

Traditionally, performance appraisal has been used as just a method for determining and
justifying the salaries of the employees. Than it began to be used a tool for determining
rewards (a rise in the pay) and punishments (a cut in the pay) for the past performance of
the employees.

This approach was a past oriented approach which focused only on the past performance
of the employees i.e. during a past specified period of time. This approach did not
consider the developmental aspects of the employee performance i.e. his training and
development needs or career developmental possibilities. The primary concern of the
traditional approach is to judge the performance of the organization as a whole by the
past performances of its employees
Therefore, this approach is also called as the overall approach. In 1950s the performance
appraisal was recognized as a complete system in itself and the Modern Approach to
performance appraisal was developed.

Performance appraisal - Modern approach

The modern approach to performance development has made the performance appraisal
process more formal and structured. Now, the performance appraisal is taken as a tool to
identify better performing employees from others, employees’ training needs, career
development paths, rewards and bonuses and their promotions to the next levels.

Appraisals have become a continuous and periodic activity in the organizations. The
results of performance appraisals are used to take various other HR decisions like
promotions, demotions, transfers, training and development, reward outcomes. The
modern approach to performance appraisals includes a feedback process that helps to
strengthen the relationships between superiors and subordinates and improve
communication throughout the organization.

The modern approach to performance appraisal is a future oriented approach and is

developmental in nature. This recognizes employees as individuals and focuses on their
development.

360 DEGREE PERFORMANCE APPRAISALS

360 degree feedback, also known as 'multi-rater feedback', is the most comprehensive
appraisal where the feedback about the employees’ performance comes from all the
sources that come in contact with the employee on his job.

360 degree respondents for an employee can be his/her peers, managers (i.e. superior),
subordinates, team members, customers, suppliers/ vendors - anyone who comes into
contact with the employee and can provide valuable insights and information or feedback
regarding the “on-the-job” performance of the employee.

360 degree appraisal has four integral components:

1. Self appraisal
2. Superior’s appraisal
3. Subordinate’s appraisal
4. Peer appraisal.

Self appraisal gives a chance to the employee to look at his/her strengths and
weaknesses, his achievements, and judge his own performance. Superior’s appraisal
forms the traditional part of the 360 degree appraisal where the employees’
responsibilities and actual performance is rated by the superior.

Subordinates appraisal gives a chance to judge the employee on the parameters like
communication and motivating abilities, superior’s ability to delegate the work,
leadership qualities etc. Also known as internal customers, the correct feedback given by
peers can help to find employees’ abilities to work in a team, co-operation and sensitivity
towards others.

Self assessment is an indispensable part of 360 degree appraisals and therefore 360
degree appraisals have high employee involvement and also have the strongest impact on
behavior and performance. It provides a "360-degree review" of the employees’
performance and is considered to be one of the most credible performance appraisal
methods.

360 degree appraisal is also a powerful developmental tool because when conducted at
regular intervals (say yearly) it helps to keep a track of the changes others’ perceptions
about the employees. A 360 degree appraisal is generally found more suitable for the
managers as it helps to assess their leadership and managing styles. This technique is
being effectively used across the globe for performance appraisals. Some of the
organizations following it are Wipro, Infosys, and Reliance Industries etc.

Performance Appraisal Process - Key to Change organizational Culture

The performance appraisal process provides an opportunity for introducing
organizational change. It facilitates the process of change in the organizational culture.
The interactive sessions between the management and the employees, the mutual goal
setting and the efforts towards the career development of the employees help the
organization to become a learning organization. Conducting performance appraisals on a
regular basis helps it to become an ongoing part of everyday practice and helps
employees to take the responsibility of their work and boosts their professional
development.

Various studies in the field of human resources have already proved that performance
appraisal process can affect the individual performance (in a negative or positive way),
thus having an impact on the collective performance.

Performance appraisal: An opportunity for an organisational culture shift

Performance appraisal process focuses on the goal setting approach throughout the
organisation.

Performance appraisal helps the clarity and understanding of the roles and
responsibilities of the employees.

The performance appraisal processes have the potential positive effects on recruitment

It increases organisational effectiveness i.e. what to do and how to do through a formal

and structured approach.

Some evidence of the beneficial effects of team rewards

Therefore, performance appraisal is also an important link in the process of change in
organization culture.

sudhanshu112june
View Public Profile
Send a private message to sudhanshu112june
Find all posts by sudhanshu112june

#5 (permalink)
23-10-2007, 10:58 AM
Join Date: Aug 2007 Said Thanks: 3
sangeetachauhan Location: India Thanked 6 Times in 2 Posts
Posts: 181

Re: What is Performance appraisal?

Hi Myalay

There is host of information of this site regarding performance appraisal. Pls. type the
word "performance appraisal" in the search query box and you will get all the
information needed.

I have posted my project on performance appraisal which I'm sure will be very useful to
you.

Hope your query is solved.

regards
sangeeta

__________________
regards

Sangeeta

sangeetachauhan
View Public Profile
Send a private message to sangeetachauhan
Find all posts by sangeetachauhan

#6 (permalink)
11-08-2008, 11:38 AM
Join Date: Feb 2008 Said Thanks: 2
parameshwarsreekumar Location: UAE Thanked 1 Time in 1 Post
Posts: 26

very good article.

parameshwarsreekumar
View Public Profile
Send a private message to parameshwarsreekumar
Find all posts by parameshwarsreekumar

#7 (permalink)
11-08-2008, 02:12 PM
Join Date: Jul 2008 Blog Entries: 3
Posts: 78 Said Thanks: 1
priyankareddyavuthu
Thanked 13 Times in 12 Posts

Performance appraisal, also known as employee appraisal, is a method by which the

job performance of an employee is evaluated (generally in terms of quality, quantity, cost
and time). Performance appraisal is a part of career development.

Performance appraisals are a regular review of employee performance within

organizations.
Generally, the aims of a scheme are:

• Give feedback on performance to employees.

• Identify employee training needs.
• Document criteria used to allocate organizational rewards.
• Form a basis for personnel decisions: salary increases, promotions, disciplinary
actions, etc.
• Provide the opportunity for organizational diagnosis and development.
• Facilitate communication between employee and administrator.
• Validate selection techniques and human resource policies to meet federal Equal
Employment Opportunity requirements.

A common approach to assessing performance is to use a numerical or scalar rating

system whereby managers are asked to score an individual against a number of
objectives/attributes. In some companies, employees receive assessments from their
manager, peers, subordinates and customers while also performing a self assessment.
This is known as 360° appraisal.
The most popular methods that are being used as performance appraisal process are:

• Management by objectives (MBO)

• 360 degree appraisal
• Behavioral Observation Scale (BOS)
• Behaviorally Anchored Rating Scale (BARS)

Trait based systems, which rely on factors such as integrity and conscientiousness, are
also commonly used by businesses. The scientific literature on the subject provides
evidence that assessing employees on factors such as these should be avoided. The
reasons for this are two-fold:
1) because trait based systems are by definition based on personality traits, they make it
difficult for a manager to provide feedback that can cause positive change in employee
performance. This is caused by the fact that personality dimensions are for the most part
static, and while an employee can change a specific behavior they cannot change their
personality. For example, a person who lacks integrity may stop lying to a manager
because they have been caught, but they still have low integrity and are likely to lie again
when the threat of being caught is gone.
2) Trait based systems, because they are vague, are more easily influenced by office
politics, causing them to be less reliable as a source of information on an employee's true
performance. The vagueness of these instruments allows managers to fill them out based
on who they want to/feel should get a raise, rather than basing scores on specific
behaviors employees should/should not be engaging in. These systems are also more
likely to leave a company open to discrimination claims because a manager can make
biased decisions without having to back them up with specific behavioral information.
regards,
priyanka