UNIT-3

Potential Appraisal

The potential appraisal refers to the appraisal i.e. identification of the hidden talents and skills of a
person. The person might or might not be aware of them. Potential appraisal is a future – oriented
appraisal whose main objective is to identify and evaluate the potential of the employees to assume
higher positions and responsibilities in the organizational hierarchy. Many organisations consider and
use potential appraisal as a part of the performance appraisal processes.

The purposes of a potential review are:

1. to inform employees of their future prospects;

2. to enable the organisation to draft a management succession programme;
3. to update training and recruitment activities;
4. to advise employees about the work to be done to enhance .their career opportunities.

Techniques of potential appraisal:

1. Self – appraisals
2. Peer appraisals
3. Superior appraisals
4. MBO
5. Psychological and psychometric tests
6. Management games like role playing
7. Leadership exercises etc.

Potential appraisal helps to identify what can happen in future so that it can be guided and directed
towards the achievement of individual and organizational growth and goals. Therefore, potential should
be included as a part of the Performance appraisal in organisations.

Potential Appraisal Vs. Performance Appraisal

Potential Appraisal is forward looking process whether performance appraisal is backward looking
process. Any good or worse assessment results of performance appraisal may not be a good factor for
potential appraisal. But current performance of an employee could show evidance somewhere whether
he/she is flexible for new working conditions.

Contemprory issues potential appraisal:-

There are certain issues with respect to assessment centres that persist in Indian organisations such as:-

1)-complexity of implementation
2)-clear behavioural description of competencies

3)-availability of assessors

4)-Assessor training

5)-Inter rater reliability

6)-Appropriateness of selection tools

7)-Validity of exercises

8)-Organisational commitment in terms of time and resources

9)-Involvement of line managers

10)-Feedback to participants

11)-Data security

Competency Mapping

Competency Mapping is a process of identifying key competencies for an organization and/or a job and
incorporating those competencies throughout the various processes (i.e. job evaluation, training,
recruitment) of the organization. A competency is defined as a behavior (i.e. communication,
leadership) rather than a skill or ability.

The steps involved in competency mapping with an end result of job evaluation include the following:

1. Conduct a job analysis by asking incumbents to complete a position information questionnaire

(PIQ). The PIQ can be provided for incumbents to complete, or you can conduct one-on-one interviews
using the PIQ as a guide. The primary goal is to gather from incumbents what they feel are the key
behaviors necessary to perform their respective jobs.
2-Using the results of the job analysis, you are ready to develop a competency based job description.
This is developed by carefully analyzing the input from the represented group of incumbents and
converting it to standard competencies.
3-With a competency based job description, you are on your way to begin mapping the
competencies throughout your HR processes. The competencies of the respective job description
become your factors for assessment on the performance evaluation. Using competencies will help guide
you to perform more objective evaluations based on displayed or not displayed behaviors.
4-Taking the competency mapping one step further, you can use the results of your evaluation to
identify in what competencies individuals need additional development or training. This will help you
focus your training needs on the goals of the position and company and help your employees develop
toward the ultimate success of the organization.
Competency mapping & its linkage with career development:-

There are 7 steps of competency mapping in link with career development:-

1) Identify key components of employee job descriptions - the critical points only. Focus on what

characteristics and skills are absolutely essential to get the job done. Remember that job descriptions

often serve different purposes when posting a position than is needed to explain the role's
responsibilities.

2) Clarify roles and eliminate superfluous information - narrow the scope again. Look through your

essential words and phrases. Ask yourself whether you have more words than needed to describe the

essential characteristics. Then ask yourself whether the role's responsibilities are clear. How do they

align to the task? the team's mission? the overall organizational strategy? If they don't, back to the

drawing board.

3) Identify required aptitudes, attitudes, skills, and knowledge for roles - critical components of the

competencies are what is beneath the surface of employee behavior. Like an iceberg, we see only what

is above water, but realize the vast majority is underneath. These values, underlying skills, and

approach to work is what you're after. Identify what you need for a successful employee.

4) Synthesize ideas into central themes and define them - no more than 10 competencies. You will

get mired in the assessment and analysis portion if you don't narrow it down to the critical few. Start

researching other similar organizations and the competencies they require of employees. Look to the K-

12 educational sector. There's quite a bit of knowledge about teacher competencies that will likely align

very well with your team.

5) Create a five-scale rubric system - describe what a novice looks like for each competency. What

about your expert? What does performance at each level in between look like? What are the skills,

aptitudes, and knowledge required at the minimum for each level? Here's where you will want to

clearly describe the behaviors exhibited by individuals who perform at each level on the novice-to-

expert scale. Ask others to review your list. Would they know what is expected to perform at each

level? If not, it's back to the drawing board.

6) Build assessments - organize your set of questions aimed at identifying level of alignment for each

of the five scales you've designed. Don't just ask questions that measure whether someone is an expert.

Look for open ended questions such as "describe how you would do..." or "explain what you did when

you were able to accomplish..." Ask your candidates multiple layered questions. Never, ever, ask a

question that can be answered with a "yes or no." You're looking for depth of answer here so that you

can evaluate how well it fits to your rubric.

7) Build logistics for roll-out and on-going measurement cycles - this is the fun part! You build a list

of competencies, defined them, built rubrics to assess level of competency on a novice-to-expert scale.

Now you need to launch your program. Pay attention to your audience. Are they a group of people with

test anxiety? Do they prefer written or oral assessment? Would they be excited to show where they are

at as far as their performance? The program will lose its luster if you only do it once. Build a plan for

continuous assessment - but don't go crazy with it. Twice a year is probably more than enough. Use the

time in between to build on the gap areas of your team. Make sure they're moving toward the skillset of

your defined expert. However, don't assume everyone will get there. A good rule of thumb is that you'll

have the majority of your team in the middle 60%, with 20% of them on either side of the novice-to-

expert scale.

Balance score card:-

Concept of Balanced Score Card (BSC):

The concept of Balanced Score Card (BSC) was introduced by Robert S. Kaplan and David P. Norton

in 1992 through an article published in the Howard Business Review in 1992.

This concept consists in identifying the vision and mission of an organisation; identifying the strategies

to achieve that mission and analyzing the performance of the organization from certain perspectives –

to have an idea of how for the organization is successful or otherwise.

Meaning of BSC:-

The balanced scorecard (BSC) is a strategy performance management tool – a semi-standard

structured report, supported by design methods and automation tools, that can be used by managers to
keep track of the execution of activities by the staff within their control and to monitor the
consequences arising from these actions.
The critical characteristics that define a balanced scorecard are:_

 its focus on the strategic agenda of the organization concerned

 the selection of a small number of data items to monitor
 a mix of financial and non-financial data items.

The Concept of BSC could be depicted by means of the following diagram:

Advantages of BSC:

Following are some advantages of BSC:

(i) BSC adopts a balanced and comprehensive approach for judging and controlling an organization’s

performance; by setting objectives and performance measures in four key perspective viz. financial,

customer, business and internal processes and learning and growth.

(ii) BSC facilitates communication and understanding of business goals and strategies, at all levels of

an organization.

(iii) BSC brings organization’s strategy and vision, to the centre of management focus; so that

management may never deviate from these.

(iv) BSC integrates financial and non-financial goals and performance measures into a single system –

a thing which traditional controlling techniques never consider.

Limitations of BSC:

BSC approach to controlling suffers from serious limitations, some of which are as follows:

(i) BSC bases its approach to analysis around four perspectives (viz. financial, customer, business and

production processes and learning and growth) only. In fact, there may be many more perspectives

more important than these e.g. managerial development perspectives, social responsibility perspective

and so on. As such, the so called Balanced Score Card really turns into an imbalanced and imperfect

score card.

(ii) BSC is a vague concept and approach, to controlling an organization’s success; as there are neither

any set of standard goals nor any set of standard performance measures, for each of the four

perspectives, which from the core of BSC.

(iii) BSC just considers organizational performance from four perspectives. It suggests nothing about

what should be done to better performance in each of these perspectives. Its job, it seems, is just

counting casualties, after the battle is over.

Example of Balance Score Card:-