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    Unit 4 Performance Management System

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    sakshi tomar
    The document discusses performance management systems, including: 1) Defining key concepts like performance appraisal, goal setting, and feedback processes. 2) Describing common appraisal methods like graphic rating scales, rankings, and narratives that evaluate employees on skills, goals, and job duties. 3) Explaining that performance management is a continuous process of aligning employee performance with organizational goals through direction, monitoring, feedback, coaching, and rewards.

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    Unit 4 Performance Management System

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    sakshi tomar
    209 views21 pages
    The document discusses performance management systems, including: 1) Defining key concepts like performance appraisal, goal setting, and feedback processes. 2) Describing common appraisal methods like graphic rating scales, rankings, and narratives that evaluate employees on skills, goals, and job duties. 3) Explaining that performance management is a continuous process of aligning employee performance with organizational goals through direction, monitoring, feedback, coaching, and rewards.

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    The document discusses performance management systems, including: 1) Defining key concepts like performance appraisal, goal setting, and feedback processes. 2) Describing common appraisal methods like graphic rating scales, rankings, and narratives that evaluate employees on skills, goals, and job duties. 3) Explaining that performance management is a continuous process of aligning employee performance with organizational goals through direction, monitoring, feedback, coaching, and rewards.

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    © All Rights Reserved
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    209 views21 pages

    Unit 4 Performance Management System

    Uploaded by

    sakshi tomar
    The document discusses performance management systems, including: 1) Defining key concepts like performance appraisal, goal setting, and feedback processes. 2) Describing common appraisal methods like graphic rating scales, rankings, and narratives that evaluate employees on skills, goals, and job duties. 3) Explaining that performance management is a continuous process of aligning employee performance with organizational goals through direction, monitoring, feedback, coaching, and rewards.

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    Unit 4

    Performance Management System


    Performance Management System
    • Concepts
    • Components of Performance Management System
    • Procedures and Technique of Performance Appraisal
    • Difference between Performance Appraisal and Performance
    Management System
    • Different Methods of Performance Appraisal
    • Ratings Errors and Biases
    Performance Appraisal
    • Performance appraisal means evaluating an employees current
    and/or past performance relative to his or her performance
    standards.
    • 3-Step Performance Appraisal Process
    • Setting Work Standards
    • Assessing The Employees Actual Performance Relative To Those Standards
    • Providing Feedback To The Employee With The Aim Of Helping Him Or Her To
    Eliminate performance deficiencies or to continue to perform above par.
    Why Performance Appraisal
    • Pay, promotion, and retention decisions based on the employees
    appraisal
    • Employee’s and teams performance makes sense in terms of the
    company s overall goals.
    • Develop a plan for correcting any deficiencies, and to reinforce the
    things the subordinate does right
    • Facilitate career planning
    • Identify employees training and development needs
    Defining the Employees Goals and
    Performance Standards
    • First, the supervisor must decide what to measure
    • Effective goals are SMART
    • Appraise employees based on the competencies and skills the job
    requires.
    • Appraises and rewards employees based on a skills matrix
    • the basic skills required to do that job (such as technical expertise )
    • the minimum level of each skill that job requires
    • What to appraise and how to appraise it will be obvious from the job
    description. In terms of what criteria to appraise, the job description
    should list the jobs duties or tasks
    Who Should Do the Appraising?
    • Appraisals by the immediate supervisor. Getting a supervisor’s
    appraisal is relatively straightforward and makes sense. The
    supervisor is usually in the best position to observe and evaluate his
    or her subordinates performance. The supervisor is also responsible
    for that persons performance.
    • The human resources department serves a policy-making and
    advisory role
    • Peer Appraisals With more firms using self-managing teams,
    appraisal of an employee by his or her peers peer appraisal is popular
    Who Should Do the Appraising? (contd.)
    • Rating Committees A rating committee is usually composed of the
    employees immediate supervisor and three or four other supervisors.
    Using multiple raters is advantageous. Multiple raters often see
    different facets of an employees performance.
    • Self-ratings Some employers obtain employees self-ratings, usually in
    conjunction with supervisors ratings. The basic problem, of course, is
    that employees usually rate themselves higher than do their
    supervisors or peers
    • Appraisal By Subordinates Many employers have subordinates rate
    their managers, usually for developmental rather than for pay
    purposes
    Who Should Do the Appraising?
    (contd.)
    • 360-degree Feedback – The employer collects performance
    information all around an employee from his or her supervisors,
    subordinates, peers, and internal or external customers generally for
    developmental rather than pay purposes. 360-degree appraisals are
    more candid when subordinates know rewards or promotions are not
    involved.
    Methods of Performance Appraisal

    Traditional Method Modern Method


    1. Ranking Method
    2. Paired Comparison
    1. Management by Objectives
    3. Grading Method (MBO)
    4. Forced Distribution Method 2. Behaviourally Anchored Rating
    5. Forced-Choice Method
    6. Check-List Method
    Scales (BARS)
    7. Critical Incidents Method 3. Assessment Centers
    8. Graphic Rating Scale Method
    9. Essay Method 4. 360 – Degree Appraisal
    10. Field Review Method 5. Human Resource Accounting
    11. Confidential Report
    Techniques of Performance Appraisal
    • Graphic Rating Scale Method - Simplest and most popular method
    for appraising performance. A graphic rating scale lists
    • Traits or performance dimensions (such as communication or teamwork ) and
    • A range of performance values (from below expectations to role model or
    unsatisfactory to outstanding, ) for each trait.

     The supervisor rates each subordinate by circling or checking the score that
    best describes the subordinates performance for each trait
     The employee is then rated by identifying the score that best describes his
    or her level of performance for each traits
     The manager then totals the assigned ratings for the traits.
    Techniques of Performance Appraisal
    • Graphic ratings scales used to illustrate the range of traits or
    performance dimensions
    • Some rating scales assess generic job dimensions such as communications,
    teamwork, know-how, and quantity.
    • Another option is to rate the employees performance on the jobs actual
    duties.
    • Competency-based appraisal forms are another option. Here you focus on
    the extent to which the employee exhibits the competencies (generally the
    skills and/or knowledge) needed to perform the job
    Techniques of Performance Appraisal
    • Alternation Ranking Method Ranking employees from best to worst
    on a trait or traits is another option. Since it is usually easier to
    distinguish between the worst and best employees, an alternation
    ranking method is most popular.
    • Paired Comparison Method The paired comparison method helps
    make the ranking method more precise. For every trait (quantity of
    work, quality of work, and so on), you pair and compare every
    subordinate with every other subordinate.
    Techniques of Performance Appraisal
    • The forced distribution method is similar to grading on a curve.With
    this method, you place predetermined percentages of ratees into
    several performance categories. Forced distribution makes some
    sense. It reflects the fact that top employees often outperform
    average or poor ones by as much as 100%.
    • The critical incident method, the supervisor keeps a log of positive
    and negative examples (critical incidents) of a subordinates work-
    related behavior. Every 6 months or so, supervisor and subordinate
    meet to discuss the latters performance, using the incidents as
    examples. Keeping a record of uncommonly good or undesirable
    examples of an employees work-related behavior and reviewing it
    with the employee at predetermined times.
    Techniques of Performance Appraisal
    • Management by Objectives (MBO): The concept of MBO can be
    described as a “process whereby the superior and subordinate
    managers of an organization jointly identify its common goals, define
    each individual’s major areas of responsibility in terms of results
    expected of him, and use these measures as guides for operating the
    unit and assessing the contribution of each its members”.
    • Assessment Centers: An assessment center is a central location where
    the managers may come together to participate in job related
    exercises evaluated by trained observers. The principle idea is to
    evaluate managers over a period of time, by observing and later
    evaluating their behaviour.
    Techniques of Performance Appraisal
    • Narrative Forms All or part of the written appraisal may be in
    narrative form. Here the persons supervisor assesses the employees
    past performance and required areas of improvement. The
    supervisors narrative assessment aids helps the employee understand
    where his or her performance was good or bad, and how to improve
    that performance.
    • A behaviorally anchored rating scale (BARS) is an appraisal tool that
    anchors a numerical rating scale with specific illustrative examples of
    good or poor performance. An appraisal method that aims at
    combining the benefits of narrative critical incidents and quantified
    ratings by anchoring a quantified scale with specific narrative
    examples of good and poor performance.
    Performance Management
    • The continuous process of identifying, measuring, and developing the
    performance of individuals and teams and aligning their performance with
    the organizations goals
    • Performance management is about what you’re going to do to help an
    employee continue in their development to become increasingly better in
    their performance for your organization.
    • Performance management encompasses how an employee is managed
    throughout his or her life cycle as part of the company. Performance
    management begins in the orientation and onboarding period, continues
    throughout the employee’s tenure, and involves the continuous feedback
    between employee and manager, colleagues, etc.
    Performance Management Elements
    • Direction sharing means communicating the companys goals throughout the company and then
    translating these into doable departmental, team, and individual goals.
    • Goal alignment means having a method that enables managers and employees to see the link
    between the employees goals and those of their department and company.
    • Ongoing performance monitoring usually includes using computerized systems that measure and
    then e-mail progress and exception reports based on the persons progress toward meeting his or
    her performance goals.
    • Ongoing feedback includes both face-to-face and computerized feedback regarding progress
    toward goals.
    • Coaching and developmental support should be an integral part of the feedback process.
    • Recognition and rewards provide the consequences needed to keep the employees goal-directed
    performance on track.
    Performance Appraisal vs. Performance
    Management
    Performance appraisal Performance management
     Operational  Strategic
     Top-down assessment  More likely to involve dialog
     Retrospective for corrections  Future-oriented for growth
     Ongoing or continuous review, interspersed with
     Typically once or twice per year
    formal reviews
     Often uses ratings or rankings  Less likely to involve ratings
     Rigid structure/system  Flexible process
     Not linked to business needs  Linked to business needs
     Combines quantitative and qualitative
     Usually takes a quantitative approach
    approaches
     Individual  Collective
     Often linked to compensation  Not usually linked to compensation
     Often very bureaucratic with a focus on
     Less concerned with documentation
    paperwork/documents
     Usually housed in HR department  Conducted by managers and supervisors
    Rating Errors
    • UNCLEAR STANDARDS - This graphic rating scale seems objective.
    However, it would probably result in unfair appraisals, because the
    traits and degrees of merit are ambiguous. For example, different
    supervisors might define good performance, fair performance, and so
    on differently. The same is true of traits such as quality of work or
    creativity.
    • HALO EFFECT Experts define halo effect as the influence of a rater s
    general impression on ratings of specific ratee qualities. In
    performance appraisal, the problem that occurs when a supervisors
    rating of a subordinate on one trait biases the rating of that person on
    other traits
    Rating Errors
    • CENTRAL TENDENCY Some supervisors stick to the middle when filling
    in rating scales. For example, if the rating scale ranges from 1 to
    7,they tend to avoid the highs (6 and 7) and lows (1 and 2) and rate
    most of their people between 3 and 5. Central tendency means rating
    all employees average. Doing so distorts the evaluations, making
    them less useful for promotion, salary, or counseling purposes.
    • LENIENCY OR STRICTNESS This strictness/leniency problem is
    especially severe with graphic rating scales. On the other hand,
    ranking forces supervisors to distinguish between high and low
    performers.
    Bias
    • The tendency to allow individual differences such as age, race, and
    sex to affect the appraisal ratings employees receive.
    • Performance ratings amplify the quality of the personal relationship
    between boss and employee. Good relationships tend to create good
    [appraisal] experiences, bad relationships bad ones

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