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Performance Appraisal

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Description of Performance Appraisal. Explanation.


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Performance AppraisalDefinition Performance Appraisal. Description.

 

A Performance Appraisal is a method and a process to identify, observe, measure, evaluate and develop individual employee performance and (indirectly) to improve the effectiveness of the organization as a whole. An appraisal normally consists out of the assessment by a qualified person of the performance and of the development and training needs of an employee. It is important to realize there are two sides to any appraisal:

  1. Judgment (Historic). Actual performance is compared against performance targets and feedback (both positive and negative) is given. This may or may not include the determination of a pay increase. Generally, including pay in the Appraisal has the major disadvantages that honest and open communication becomes almost impossible, and the judgment part of the Appraisal becomes too dominant.

  2. Development (Future-oriented). The needs of the employee are evaluated in terms of the training requirement to improve skills and knowledge in line with future performance objectives and the direction the employee wants to grow. Furthermore Employee Objectives (SMART: Specific, Measurable, Achievable, Realistic/Relevant, Time-related) are agreed. Compare: Career Management.

Any Performance Appraisal should be:

  1. Documented.

  2. Delivered in a face-to-face meeting.

Performance Appraisal FormAny Appraisal should be well prepared for by both the manager and the employee. Although normally the line manager of the employee is best positioned to be the appraiser, in some organizations it can be a special Personnel Manager. The advantage can be that this specialized person has more experience, special skills and knowledge on doing employee reviews. An issue is that the Personnel Manager must be aware of how the employee is functioning in his work environment. This can be supported by Peer-Appraisals and/or by 360-Degree Feedback.

 

Steps in a Performance Appraisal. Process

Typically a an appraisal of performance is comprised of three main steps:

  1. Definition of the expected duties and the job standards. By line manager, together with employee.
  2. Conduct of the performance appraisal, comparing the actual performance of the employee with the performance standard that were previously defined.
  3. Feedback and follow-up: line manager provides feedback to the employee and plans are made for future development.

Forum

Recent User Comments
Naveen Gupta - India Performance Appraisal Quotes "My quote for the day not related to this topic but willing to add here "use less people instead of useless people" in the performance appraisal. Don't use this quote if you are a appraiser, but just re-wind the calender year and look-out for the good and bad about the appraisee. Current performances (bad or good) of the employee must be kept aside like an un-sent mail & evaluate based on the past performance considering future perspectives."    2
Neil F. Keehn - USA Performance Appraisal and Salary Determination "The performance appraisal process should be based upon an assessment of the employee's value to the company. This value should be based upon the employee's contribution to revenue generation, profit enhancement and/or cost reduction.
I have devised a 13-point employee evaluation method that is part of a process that leads an estimate of an employee's total monetary value to the company. Once the total value of the individual has been computed, the employee's baseline salary can be computed. One method for computing this value is to use the inverse relief from royalty valuation method. This value is based upon the employee's past performance.
A real options method is then used to modify this baseline salary up or down, depending upon management's perception of what the employee will contribute to the company's bottom line in the future. The time horizon for this estimate is based upon how quickly the employee's skill set becomes obsolete if he/she does nothing to upgrade his/her skills."		    0
Rommel Aniag - Philippines A Case of Mismatch: Actions Yesterday, Rewarded/punished This Year "It has always been my concern that the traditional way of determining the compensation of an employee is on the basis (almost always) of what he has done in the past (good or bad) and not so much (if at all its considered), what he is capable of (or will be) doing for the next period.
During appraisal season, I have often grappled with the dilemma of "punishing" an employee for mistakes committed in the past year (and for which he has learned from), reflecting it his appraisal. Which eventually directly affects his supposed annual increase (or lack thereof).
My argument is that when the employee has clearly learned his lesson and will not likely succumb to the same mistakes, he should not be made to carry that mistake into his future take home pays, for an entire period, for he has learned his lessons about it. Our HR Director has often disagreed with me on this matter. It seems that I am a lonely voice coming from this perspective. Please share your thoughts."		    0
Debahooti Basu - India Performance Appraisal "It is not only the performance that is to be studied but the situation where the job is being carried out needs to be studied. We human are always carried away by our perception. We need to check back our views and criticise our own output& also try to implement it."    6
Francis E Hilotina - Philippines Value System Appraisal "Performance evaluation is a function of any value system. Thus, efficient performance appraisal should deliver valuable results to organization. Anything in a PA that is outside this context accounts for ineffective exercise of function, produces undesirable results, much less irrelevant to organizational objectives. Performance is about managing human capital that is as fragile as the window of future any company can open. Managers must take care that employees happily deliver today and return to work the following morning."    1



Best User Comments
Martin Dale - USA Checklist of Common Errors in Performance Appraisals "I was asked to make a list of common mistakes by managers in performance appraisals.
G.T. Milkovich and J.M. Newman report the following ones (Compensation, 2002):
1. Halo Effect: a favorable rating for all job duties based on performance in one duty in which the employee is a 'saint'.
2. Central Tendency: rating all employees close to the midpoint of the scale (irrespective of their actual performance).
3. Recency Effect: judging overall effectiveness on the basis of recent experience.
Some others I found:
4. Subjectiveness: based on gut feeling
5. No/Poor Follow-up
6. Improper Preparation
Who can help me and provide further common mistakes or biases in employee appraisals? Thanks!"		    16
Muneer Al Abbasi - Bahrain The best Performance Appraisal Software "We are interesting to buy a new latest appraisal system in our organisation - Multinational Invetment Bank. Could you please help us in finding the best availble software (systems) in Employees Performance Appriasal, that you already have practiced & used.."    1
Sootasina - New Zealand Workplace Leadership "I need an advice, iwith an explanation of the appraisal methods and practical example - behaviourally anchored rating scale"    1
Kabaso K Cynthia - Zambia Appraisal for Future Job? "I am currently studying Project Planning and management . Can performance appraisal be done to appraise an employee on a job they are not currently holding but are qualified for?"    1
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Compare with: Self-Appraisal  |  Peer-Appraisal  |  Behavioral Observation Scales  |  Competency-based Approach  |  Behaviorally Anchored Rating Scales  |  360-Degree Feedback  |  Management by Objectives  |  CSFs and KPIs  |  Result Oriented Management  |  Pre-Employment Screening

 

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End of description Performance Appraisal. An explanation.

 

 
Copyright 2010 12manage - The Executive Fast Track. V10.5 - Last updated: 22-3-2010. All names tm by their owners.



  └► Trevor Akpomughe (Nigeria) Actions Yesterday. Rewarded / Punished This Year "I disagree with your opinion. So what is the consequence of the employee's bad performance? When will that consequence be meted out? You don't seem to mind the consequence of rewarding the employee for past performance. Granted the employee should(?) have learned from the error, but just as good judgment is rewarded, bad judgment should be punished and that should be done after performance appraisal!"
  └► Joseph (Malta) A Case of Mismatch: Actions Yesterday. Rewarded/punished This Year "Is there anyone on this planet that does not make mistakes? Mistakes are part of the learning curve and, in my opinion, they should be considered as adjustments not punishments on the employees. Obviously, this holds true if the employee learns from and not repeat his one-off mistakes - "to err is human, to persist is diabolical".
One could ponder on these questions: could it not also be that mistakes of the employees result from bad management example, lack of induction training? In such cases, does the management punish itself? Wouldn't the concept of trust be better? What happens if the one-off mistake done by an employee reveals a fault in the whole system? Shouldn't the employee be rewarded then for exposing the fault through his mistake?
One last thing, managers should also be humble enough to realise that their learning process is continuous and does not reach a limit. This means that managers have also many things to learn even from the lowest ranked employees."
  └► Hans Jørgen Pedersen (Denmark) A Case of Mismatch: Actions Yesterday / Punished This Year. "An interesting way of putting it.. I take, you consider pay raises as a right? Otherwise, I don't see the sense of saying that a lack of an annual increase is an "additional" punishment.
I think the trick here is to consider how the appraisal is performed and with what purpose. Is payment a disciplinary tool or simply the employer's side of the working agreement? I do hope for all that their learning feedback isn't pooled up for the annual appraisal, but in-evidently the salary budget to meter out to the staff has to be connected with performance and according to company politics."



  └► Michel Lemieux (Canada) Performance Appraisal Errors "You could add 7. lack of preparation of evaluators (training, behaviours to evaluate, what is poor to exceptional performance...) in assessing level of performance of evaluees. Most often a set of guidelines is the only reference a superior is given in order to assess a performance."
  └► Runyararo Chimwanda (Netherlands) Common Perfomance Management Errors "8. Culture: in some cases the way organisations view perfomance management depends on the culture. A high flier can not score a low rating in the following year. This would then mean a mistake by the previous supervisor who could have awarded a higher rating.
Depending also on the culture of the nation, in some nations one can not score a 5 or 1. Where such a mark is awarded there are a lot of doubts in the credibility of such a rating."
  └► Oosterhof (Netherlands) Common Performance Appraisal Mistakes "9. Making appraisals too complicated is a common mistake too (e.g. too many dimensions). Look at the books "Hard Facts" and "Knowing Doing Gap" by Pfeffer & Sutton."
  └► David Mcara (UK) Performance Appraisal is a Big Mistake "The biggest mistake is imagining that performance appraisal is a useful idea and that organisation by management hierarchy is a sensible way to get anything done. Upward appraisal can be useful to managers who are skilled in listening."
  └► Shaikh Husnuddin Nooruddin (Qatar) Mistakes by Managers in Appraisal "10. Not considering the period of service and education level of the employee."
  └► Mauro Piccone (Italy) People are Different "11. Not being adaptive in the appraisal. People are different and so the assessor has to be able to put the person who he is talking to in a "comfortable" position in order to stimulate a good peer dialogue."
  └► Ugeux (Belgium) Common Mistakes in Appraisals "12. Use of a Gauss curve based on budget availability: whatever the actual performance level of the employee, the marks are poor/negative."
  └► Atba Bouchaib (Morocco) Common Errors in Performance Appraisal "13. Overemphasizing negative aspects of the performance and neglecting positive ones."
  └► Navin (India) Common Error Made Deliberately in Performance Appraisal. "14. Biasing deliberately towards employees is the most common error in performance appraisals."
  └► Gerald Abeyawardena (Singapore) Performance Appraisal Errors "15. Leniency: giving higher marks than the individual's performance deserves. Usually because a) no feedback was given during the year so appraisee might be angry; b) wanting to be popular, not to loose friends, and in the case of 360 appraisals, hoping that if I give you a good appraisal you will do likewise!; c) strong tendency to avoid criticism (in the east/middle east is more a cultural effect, but I have surprisingly encountered a similar diffidence in some western organisations, more of a 'do unto others' kind of thing I think.
16. Lack of understanding of the purpose of appraisal - a number of the issues of bad appraisals automatically come into sharp focus and hence are more likely to get resolved when the appraisor understands that the prime purpose of an appraisal is to recognise and appreciate achievements, give an appraisee feedback on what could have been done better, and "feedforward" on what/how to do better next time, whilst reinforcing your belief & trust that they will succeed."
  └► Joseph (Malta) Importance of the Person "17. Treating employees as assets: employees should not be viewed merely as an asset to the organisation. Each person should be viewed holistically, given the required training and made to feel as someone that counts for the organisation. Training should not be limited to specific and/or technical based only on the functions and tasks applicable to his/her line of work, but should also include personal growth."
  └► Gana Cisse (Senegal) Other Mistakes in Performance Appraisal "18. Projection Effect: when the appraiser projects himself, emphasizing his own experience or trying to draw attention to himself, forgetting the main objective of the appraisal;
19. Coffee Break: just viewing the appraisal meeting as an opportunity to have a good time.
20. Dialogue of the Deaf or Fusillade: showing poor listening skills."
  └► H P Jani (India) Frequent Performance Appraisal Mistakes "21. Impatience: an appraisal must be followed by hard work by the employee. Often it takes a lot of time time to achieve improvements."
  └► Ngosa Mubanga (Zambia) Frequent Mistake by Managers in Appraising Surbordinates "22. Wait for the final appraisal to point out employee weaknesses."
  └► Philip Oldfield (UK) Frequent Performance Appraisal Errors "23. Lack of effort and viewing the appraisal as a purely annual activity. This is especially evident in the public sector where benefits of the appraisal system are biased toward the organisation's needs rather than the individual. Data capture from management is poor, regular feedback on a weekly, monthly basis is poor, so this leaves an annual, one or so hours face time with an employee to attempt to convey what they have achieved, contributed, delivered, positive and negatively toward the organisation and their personal growth and development. Often the appraisal system is seen as a process rather than its intended use as a tool to help in developing the individual, poor practice, poor culture and poor management builds around an ill thought out appraisal system which leads to management lethargy and complacency."
  └► Maria Dolores Miranda (Nicaragua) Frequent Performance Appraisal Errors "24. Lack of a Rational Technique to analyze the appraisal. There are several good ones, like the Capice method.
25. Focus on Performance. We should use the appraisal to boost employee potential, and negotiate a commitment for self development that is going to be a benefit both for him and the organization."
  └► Marcel Wiedenbrugge (Netherlands) Performance Appraisal Purpose and Targets "26. Not clearly defining purpose and targets. Adding value is imho the sole and only purpose of each company. This concerns customers, employees and investors / shareholders. Value is added throughout the organization and is (should be) a combined effort. In fact the extent of value added is the result of the quality of cross functional communication and cooperation (with a focal point on customer satisfaction).
Any performance appraisal therefore should have three different levels:
A) individual (targets, what are you expected to achieve, how did you achieve your targets, who made it possible to achieve your targets - interdepencies),
B) department (which value did the each department add to the performance of the company) and
C) overall (this merely relates to cross functional cooperation)
As such a performance appraisal should be measured against general goals on both an individual and group level."
  └► Jayaram.TR (India) Performance Appraisal Errors "27. Annual meeting only: performance appraisal should not be limited to discuss across once in a year. I am into strong opinion that this activity should be carried in a phased manner by selecting important topic at least once every 3 months."
  └► Joseph Ubom (USA) Performance Appraisal Structure and Reward System "Organizations should create a more structured system of performance appraisal to avoid bias within the system. The purpose should be clearly stated to identify weaknesses in performing the assigned tasks and plans for skill development. The issue of 28. promotion and pay increase should be separated from the system of performance appraisal. Appraisers use this system to favor friends from the same race and culture to get promotion and pay increase over others, not based on merit. Poor performing employees are appraised and elevated to the top above the most experienced and educated ones. It should be used as a means to discover their hidden potentials for proper utilization, greater achievements and reward for all."
  └► Fariborz (Iran) Frequent Performance Appraisal Flaws "29. Unqualified appraiser: since performance appraisal is playing an important role in both the employee's future as well that of the company, the sensitive points in the performance appraisal process should be identified by the company first.
One of the sensitive points in this process is the appraiser himself/herself, since the related information is gathered and processed by him/her.
PA's should be allocated to a person who is well qualified, it is important to realize that a qualified appraiser does not mean only a person with enough knowledge & experience but also the background of the person in question is essential too, including his/her commitment and loyalty to the company. A person with such attributes can provide excellent results for the company."
  └► Ray Hager (USA) Frequent Performance Appraisals Faults "30. (Un)pleasant surprises: nothing in a performance appraisal should be a surprise to the receiving individual. All aspects of their performance, whether it is good or an area or opportunity, should already have been discussed with the individual as part of their ongoing training and development. See also 27."
  └► Nirmala Strange (United Kingdom) SMART Performance Appraisals "31. Objectives not SMART: discerning which employees are likely to take on board constructive feedback and apply it in context takes initial time investment, fine art motor skills and management expertise.
We found that winning the hearts and minds of our employees sometimes on a daily/weekly basis coupled with measuring against SMART objectives has been very useful and aided in reducing anxiety at appraisal time as each others expectations were better managed."
  └► Mthembu (South Africa) Common Performance Appraisal Fallacies "32. Rigid appraisal formats: the appraisal system is many organizations is based on a standardised format, which makes it rigid. Any supervisor has to use the format and must adhere to the structure of the forms. Therefore the mistakes are not made by managers but by the organization systems and procedures that do not allow supervisors to use real time assessment of the subordinate's performance."
  └► Tom Barasa (Kenya) Problems with Perfomance Appraisals "The performance appraisal system is good in improving organizational achievement of goals. If used well, it will also enhance personnel development. But in many organizations it is turned into a 33. mere paper filling exercise. Managers need to be as objective as possible and put in place mechanisms of corrective action such as training, positive motivation, not punishment."
  └► Ismail Sahabodien (South Africa) Performance Appraisals Problems "34. Poor Identification of Objectives of Organization: the objectives were not properly identified in the first place. Appraisals should reflect an assessment of whether the employee is on track in contributing to the organisation's strategic goals, whether short term or long term. But if these corporate strategic goals are not properly interpreted or defined in the first place, your employees lower down the line and do not have any understanding about how their individual contribution can add to the corporate strategic objectives. Come appraisal time, neither he/she nor the managers can have a clue about their contributions."
  └► Ahmed N. Qeshta (Palestine) Performance Evaluation System "35. The performance evaluation system itself is bad: it could be that the performance evaluation system itself needs to be evaluated before performance evaluation of the work. If the system of performance evaluation is bad, it never gives us a real image about the work performed, whether the work was good or bad."
  └► Sujata (India) Biases and Grudges During Appraisal Time "36. Time to get even: a lot of supervisors wait for the appraisal to square up the pent up grudges. It's like a mini war situation where who will attack first with which weapon."
  └► Dodi Gunawan (Indonesia) Strictness in Performance Appraisal "37. Strictness. This "strictness" is subject to the tendencies to give low scores in performance appraisal. Score 10 is only for God as he is the only perfect one; 9 is for my President; 8 is for my CEO; 7 is for my GM; 6 is for me; and the rest of 5 till 1 are the suitable score for my subordinate. This strictness can be judged as the opposite of "Leniency" (#15)."


  └► Editor (Netherlands) BARS "See link below in section 'Compare with:'..."
  └► Dobson (Australia) PM Performance Management "Sootasina, suggest you have a read of Optimizing Human Capital with a Strategic Project Office: Select, Train, Measure,and Reward People for Organization Success by J. Kent Crawford, Jeannette Cabanis-Brewin. You can access excerpts here. "

  └► Bharat Gupta (Dubai) Appraisal for Future Job? "No, a performance appraisal cannot be done before a performance of an employee. A performance appraisal is a reaction to the past periodic deeds and actions of an employee; it cannot be forecasted based on qualifications! The qualifications' certificate/s are in the form of degree/s or diploma/s etc. They portray that the holder is qualified in quantitative terms of class or grades. But a performance appraisal is like a post mortem of the employee's performance or applied qualifications."