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Chapter-6 Evaluating Employee Performance

The document discusses performance evaluation in organizations. It describes the objectives, bases, process, and methods of performance evaluation. The key objectives are to provide feedback, identify training needs, document criteria for rewards, and facilitate communication. Bases of evaluation include job understanding, organizational skills, quality of work, and problem solving. The process involves establishing standards, setting goals, measuring performance, comparing to standards, discussing with employees, and initiating corrective actions if needed. Methods include absolute standards, relative standards, and objectives/goal-setting approaches. Factors like leniency error, halo effect, and central tendency can distort appraisals.

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Saimon Abedin
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0% found this document useful (0 votes)
351 views16 pages

Chapter-6 Evaluating Employee Performance

The document discusses performance evaluation in organizations. It describes the objectives, bases, process, and methods of performance evaluation. The key objectives are to provide feedback, identify training needs, document criteria for rewards, and facilitate communication. Bases of evaluation include job understanding, organizational skills, quality of work, and problem solving. The process involves establishing standards, setting goals, measuring performance, comparing to standards, discussing with employees, and initiating corrective actions if needed. Methods include absolute standards, relative standards, and objectives/goal-setting approaches. Factors like leniency error, halo effect, and central tendency can distort appraisals.

Uploaded by

Saimon Abedin
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Chapter - 6

Evaluating Employee Performance


Performance Evaluation
Performance evaluation is a formal process in an
organization whereby each employee is evaluated to
determine how the employee is performing.

Performance evaluation can be used effectively


recognize, reward, develop, redirect and document
the performance of our employees.
Objectives of Performance Evaluation
Generally, the aims of a performance appraisal are to:
 Give employees feedback on performance
 Identify employee training needs
 Document criteria used to allocate organizational rewards
 Form a basis for personnel decisions: salary increases,
promotions, disciplinary actions, bonuses, etc.
 Provide the opportunity for organizational diagnosis and
development
 Facilitate communication between employee and
administration
 Validate selection techniques and human resource
policies to meet federal Equal Employment Opportunity
requirements.
 To improve performance through counseling, coaching
and development.
Bases of Evaluation
Evaluation can be done on a lot of issues. Bases of evaluating an
employee may be a lot. But all of them are not applicable
everywhere. Which bases should be used for evaluating of the
employee depends on the nature of the job he/she is performing.
But here is a list of performance evaluation bases which are mostly
common in all respects:

Job Understanding:
 Understands job duties and responsibilities.
 Possesses sufficient skill and knowledge to perform all parts of
the job effectively, efficiently and safely.
 Understands and promotes department mission and values.

Organizational Skills:
 Ability to prioritize workload.
 Ability to manage information flow (including internal, volunteer,
and external communication, and filing/documentation).
Bases of Evaluation
Continued…….
Quality of Work:
 Attentive to detail and accuracy.
 Demonstrates thoroughness, completeness, follow through on
presentation and appearance of work.
Dependability/Reliability:
 Punctuality and regularity in attendance: arrives on time and
ready for the workday.
 Completes tasks satisfactorily:
o Meets commitments
o Works independently
o Handles change
o Stays focused under pressure
Problem Solving:
 Defines problems/central issues.
 Collects and evaluates significant or relevant data.
 Evaluates options, proposes and implements a sound solution.
Bases of Evaluation
Continued…….
Communications Skills:
 Listens effectively and responds clearly and directly.
 Makes effective oral and written communication clear and easy
to understand.
 Interacts with others in a helpful and informative manner.
Interpersonal Skills and Teamwork:
 Works effectively with other employees/departments.
 Develops positive working relationships.
 Helps improve work processes.
 Helps to accomplish specific tasks.
Planning Skills:
 Ability to establish short and long-term goals and objectives.
 Ability to develop a well-defined plan according to established
goals and objectives.
 Ability to execute a plan in an organized fashion.
Performance Evaluation Process
Evaluating the performance of the employees is an important task
of human resource management. Because a good performance
evaluation provides the true information about the efficiency and
effectiveness of the employee which helps the organization to
take any kind of decision e.g. promotion, increment, training
requirement, transfer, promotion etc. about the employee. So it
should go through a formal process. The process contains six
steps. They are:
Step 1: Establish performance standards with employees

Step 2: Mutually set measurable goals

Step 3: Measure actual performance

Step 4: Compare actual performance with standards

Step 5: Discuss the appraisal with the employee

Step 6: If necessary, initiate corrective action


Performance Evaluation Process
Continued…….
Step 1: Establish performance standards with employees: In
the first step it is required to establish some standard of the
performance on the basis of which we can be able to measure
the standard of performance of the employee. But what will be
the standard of performance depends on the nature of the job.

Step 2: Mutually set measurable goals: In the second stage it


is required to set the goals for which we are evaluating the
employee. The goals may be that to determine whether he/she
is capable to act in a higher position.

Step 3: Measure actual performance: In the third stage we


should go for the implementation of the performance evaluation
program to measure the actual performance of the employee. It
can be done with use of the evaluation form.
Performance Evaluation Process
Continued…….
Step 4: Compare actual performance with standards: In this
stage it is required to compare the actual performance with the
standards. Here it is tried to predict that whether the employee
is performing according to the standard or not.

Step 5: Discuss the appraisal with the employee: At stage


five it is required to discuss about the appraisal result with the
employee. In this stage we should present the appraisal to the
employee and ask him whether he has any kind of clarification
or not and shall tell them to be more efficient if there is any
deviation.

Step 6: If necessary, initiate corrective action: At the last


stage we should take corrective actions if necessary and if
there is no deviation, then we should give him/her the reward.
Methods of Performance Evaluation
According to many of human resource management experts there
are three different approaches for doing performance
evaluation. They are:
1. Absolute Standards Method
2. Relative Standards Method
3. Objectives
1. Absolute Standards Method : According to this method the
performance of the employee’s is measured against some
established standards. There are six types of methods under
absolute standards method. They are:
a) The essay appraisal: This is a performance evaluation method
whereby an evaluator writes a narrative about the employee. This can
be done through observing the performance of the employee or it can
be done by taking an interview of the employee. This is the most
easiest way of evaluating an employee. But in all respect it is not a
clarified and dependable way of evaluating an employee.
b) Critical Incident Appraisal: This is a performance appraisal method
that focuses on the key behaviors that make the difference between
doing job effectively or inefficiently.
Methods of Performance Evaluation
Continued…….
c) The checklist appraisal: This is a performance appraisal type
in which a rater checks off those attributes of an employee that
apply.

d) The adjective rating scale appraisal: This is a performance


appraisal method that lists a number of traits and a range of
performance for each.

e) Forced-choice Appraisal: This is a type of performance


appraisal method in which the rater must choose between two
specific statements about an employee’s work behavior.

f) Behaviorally anchored rating scale: This is a performance


appraisal technique that generates critical incidents and
develops behavioral dimensions of performance. The appraiser
appraises behaviors rather than traits.
Methods of Performance Evaluation
Continued…….
2. Relative Standards Method: In this method individuals are
compared against other individuals. These methods are
relative standards rather than absolute measuring devices.
There are three types of relative standard method. They are-

a) Group Order Ranking: This is a relative standard of


performance characterized as placing employees into a
particular classification such as the “top one-fifth”.
b) Individual Ranking: In this method employees’ performance
in ranked from highest to lowest.
c) Paired Comparison: In this method individual’s performance is
ranked by counting the number of times any one individual is
the preferred member when compared with all other
employees.

3. Objectives: This is a performance appraisal method that


induces mutual objective setting and evaluation based on the
attainment of the specific objectives.
Factors That Can Distort Appraisals

inappropriate
leniency error
substitutes

inflationary distortions halo error


pressures

central
similarity error
tendency
Factors That Can Distort Appraisals

 leniency error : each evaluator has his/her own


value system; Some evaluate high (positive leniency)
and others, low (negative leniency)

 halo error : evaluator lets an assessment of an


individual on one trait influence evaluation on all traits

 similarity error: evaluator rates others in the same


way that the evaluator perceives him or herself
Factors That Can Distort Appraisals

 central tendency: the reluctance to use the


extremes of a rating scale and to adequately
distinguish among employees being rated

 inflationary pressures: pressures for equality


and fear of retribution for low ratings leads to less
differentiation among rated employees

 inappropriate substitutes for performance:


effort, enthusiasm, appearance, etc., are less relevant
for some jobs than others

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