Behaviorally Anchored Rating Scales: Modern-Method of Performance Appraisal

Modern-Method of Performance Appraisal
ASSESSMENT CENTRES -
An assessment centre typically involves the use of methods like
social/informal events, tests and exercises, assignments being given to a group
of employees to assess their competencies to take higher responsibilities in the
future. Generally, employees are given an assignment similar to the job they
would be expected to perform if promoted. The trained evaluators observe and
evaluate employees as they perform the assigned jobs and are evaluated on job
related characteristics.
The major competencies that are judged in assessment centres are

interpersonal skills, intellectual capability, planning and organizing
capabilities, motivation, career orientation etc. assessment centres are also an
effective way to determine the training and development needs of the targeted
employees.
BEHAVIORALLY ANCHORED RATING

SCALES
Behaviorally Anchored Rating Scales (BARS) is

a relatively new technique which combines the
graphic rating scale and critical incidents
method. It consists of predetermined critical
areas of job performance or sets of behavioral
statements describing important job
performance qualities as good or bad (for eg.
the qualities like inter-personal relationships,
adaptability and reliability, job knowledge
etc). These statements are developed from
critical incidents.
In this method, an employee’s actual job

behaviour is judged against the desired
behaviour by recording and comparing the
behaviour with BARS. Developing and
practicing BARS requires expert knowledge.
HUMAN RESOURCE ACCOUNTING

METHOD
Human resources are valuable assets for

every organization. Human resource
accounting method tries to find the relative
worth of these assets in the terms of money.
In this method thePerformance appraisal of
the employees is judged in terms of cost and
contribution of the employees. The cost of
employees include all the expenses incurred
on them like their compensation, recruitment
and selection costs, induction and training
costs etc whereas their contribution includes
the total value added (in monetary terms).
The difference between the cost and the
contribution will be the performance of the
employees. Ideally, the contribution of the
employees should be greater than the cost
incurred on them.
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
degreePerformance appraisal 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.
MANAGEMENT BY OBJECTIVES
The concept of ‘Management by Objectives’ (MBO) was first given by Peter
Drucker in 1954. It can be defined as a process whereby the employees and
the superiors come together to identify common goals, the employees set their
goals to be achieved, the standards to be taken as the criteria for measurement
of their performance and contribution and deciding the course of action to be
followed.
The essence of MBO is participative goal setting, choosing course of actions

and decision making. An important part of the MBO is the measurement and
the comparison of the employee’s actual performance with the standards set.
Ideally, when employees themselves have been involved with the goal setting
and the choosing the course of action to
be followed by them, they are more likely to fulfill their

responsibilities.
THE MBO PROCESS

UNIQUE FEATURES AND ADVANTAGES OF MBO
The principle behind Management by Objectives (MBO) is to create

empowered employees who have clarity of the roles and
responsibilities expected from them, understand their objectives to
be achieved and thus help in the achievement of organizational as
well as personal goals.
Some of the important features and advantages of MBO are:
 Clarity of goals – With MBO, came the concept of SMART

goals i.e. goals that are:
Specific
Measurable
Achievable
Realistic, and
Time bound.
The goals thus set are clear, motivating and there is a

linkage between organizational goals and performance
targets of the employees.
 The focus is on future rather than on past. Goals and
standards are set for the performance for the future with
periodic reviews and feedback.
 Motivation – Involving employees in the whole process of

goal setting and increasing employee empowerment
increases employee job satisfaction and commitment.
 Better communication and Coordination – Frequent reviews

and interactions between superiors and subordinates helps
to maintain harmonious relationships within the enterprise
and also solve many problems faced during the period.

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Modern-Method of Performance Appraisal

The major competencies that are judged in assessment centres are

BEHAVIORALLY ANCHORED RATING

Behaviorally Anchored Rating Scales (BARS) is

In this method, an employee’s actual job

HUMAN RESOURCE ACCOUNTING

Human resources are valuable assets for

360 degree respondents for an employee can be his/her peers,

360 degree appraisal has four integral components:

Self appraisal gives a chance to the employee to look at his/her strengths

Subordinates appraisal gives a chance to judge the employee on the

Self assessment is an indispensable part of 360

360 degree appraisal is also a powerful

The essence of MBO is participative goal setting, choosing course of actions

be followed by them, they are more likely to fulfill their

THE MBO PROCESS

The principle behind Management by Objectives (MBO) is to create

Some of the important features and advantages of MBO are:

 Clarity of goals – With MBO, came the concept of SMART

The goals thus set are clear, motivating and there is a

 Motivation – Involving employees in the whole process of

 Better communication and Coordination – Frequent reviews

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