Om Kothari Institute of Management & Research

PRESENTATION ON

Submitted to: MS. SHIKHA BANSAL

Prepared by : POONAM SHARMA

NISHA MANGHANI
NEHA KUMAWAT
SHASHANT SINGH
SAWAAN CHANDEL
PIYUSH ADALAKHA
PERFORMANCE
APPRAISAL
 PERFORMANCE APPRAISAL
• MEANING : Performance appraisal is a
method of evaluating the behavior of employees
in the work spot , normally including both the
quantitative and qualitative aspects of job
performance. Performance here refers to the
degree of accomplishment of the tasks that
make up an individual’s job.
 PERFORMANCE APPRAISAL
• Definition : According to Cubin,
“Performance appraisal is a systematic
appraisal of the employee’s personality
traits and performance on the job and is
designed to determine his contribution and
relative worth to the firm”.
 PERFORMANCE APPRAISAL
• A formal definition : “It is the systematic
evaluation of the individual with respect to
his or her performance on the job and his
or her potential for development”.
 Nature of Performance Appraisal
Performance appraisal may be understood as the
assessment of an individual’s performance in a
systematic way ;the performance being
measured against such factor as job knowledge,
quality and quantity of output , leadership
abilities, supervision, judgment, versatility,
health and the like.
 JOB PERFOFMANCE PERFORMANCE
ANALYSIS STANDERDS APPRAISAL

Translate job
Describes work and requirements into Describes the job
personnel levels of relevant strength and
requirement of a acceptable or weaknesses of each
particular job unacceptable individual
performance
 Performance Appraisal And
competitive advantage
• THE OBJECTIVES OF PERFORMANCE
APPRAISAL,LISTED ABOVE ,POINT OUT THE
PURPOSE WHICH SUCH AN EXERCISE SEEKS TO
MEET. WHAT NEED EMPHASIS IS THAT
PERFORMANCE EVALUATION CONTRIBUTE TO
FIRMS STRENGTH. BESIDES ENCOURAGING HIGH
LEVEL OF PERFORMANCE, THE EVALUATION
SYSTEM HELPS IDENTIFY EMPLOYEES WITH
POTENTIAL ,REWARD PRFORMANCE EQUITABLY
AND DETERMINE EMPLOYREE’S NEED FOR
TRAINING.

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 improving
performance
Making
correct
Strategy decisions
and
behavior

Competitiv
e
advantage
Competitive
advantage

Values and
behaviour Ensuring
legal
compliance
Minimizing
dissatisfaction
and turnover

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 Consistency between
organisational strategy and
•
behaviour
An organisation needs a strategy consistent with
the behaviours of its employee’s if it were to realise
its goals . A truism of organisational life is that
people engage themselves in behaviours that they
perceive will be rewarded .If the focus on cost
control , employee’s will seek to control cost and
thus we recognised and rewarded. Thus the
performance appraisal system is an important
organisational mechanism to elicit feedback on the
consistency of the strategy behaviour link.

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Organisational strategy and
performance appraisal
– The performance appraisal system serves many
organisatonal objective and goals. Besides
encouraging high level performance,the
evolution system is usefull in identifying
employee’s with potential.Performance
apprasial hss definet rolls in all the three
strategy.Typically ,defenders have an narrow
and relatively stable product market
domain.Because of this narrow focus these
organisations seldom need to make measure
adjustment ‘s in tech.
 Objectives of Performance
Appraisal

The main purpose of employee

assessment are:
1) To effect promotions based on competence and
performance.

2 ) To confirm the services of probationary employees

upon their completing the probationary period
satisfaction.
5) To let the employees know where
they stand insofar as their performance
is concerned and to assist then with
constructive criticism and guidance for
the purpose of their development.
 Multiple purposes of
performance assessment
General applications Specific purpose

Developmental uses Identification of individual

needs.
Performance feedback.
Determining transfers and
job
assignments.
Identification of individual
strengths
and development needs.
• 3) Organizational maintenance HR planning.
& objection. Determining
organisation
training
needs.
Evaluation of
HR systems.
Information
for goal
identification.
• 4) Documentation Criteria
for validation research.

Documentation for HR decision.

Helping
to meet legal requirement
 Objectives of performance appraisal

Establish job expectations

Design an appraisal programme

Appraise performance

Performance interview

Archive appraisal data

Use appraisal data for appropriate purposes

 • Promotion and transfer
• Assessing tranning needs
• Awarding pay increase

Traditional System
Guiding value Attribution to individual Attribution to system
Primary goal Control, documentation Development and problem
solving

Leadership practice Directional, evaluative Facilitative, coaching

Appraisal frequency occational frequent
Degree of formality high low
The second step in the appraisal process is to establish job
expectations. This includes informing the employee what is
expected of him or her on the job. Normally, a discussion is
held with his or her superior to review the major duties
contained in the job description. Individuals should not be
expected to begin the job until they understand what is
expected of them.
 What
Methods ?

What to Formal vs Informal

Evaluate ?

Appraisal design
How to Whose
Solve? Performance ?

Who are
What Problems? the Raters ?
A.FORMAL VS INFORMAL

Formal appraisals usually occur at specified time periods- once or twice a

year. Formal appraisals are most often required by the organization for the
purpose of employee evaluation.

Informal performance appraisal can occur whenever the supervisor feels

the need for communication.

For example, if the employee has been consistently meeting or executing

standards, and informal appraisal may be in order to simply recognize this
fact. Discussions can take to be ensuring that the discussion in held in
private.
B. Whose Performance ?

-Individual
-group level

C.Who are Raters? :

Raters can be immediate supervisors, specialists from the HR department,
subordinates, peers, committees, clients, self-appraisals, or a combination of
several.
D. Problems of Rating: :Problems of Rating: Performance
appraisals are subject to a wide variety of inaccuracies and
biases referred to as ‘rating errors’. These errors occur in
the rater’s observation; judgment, information procession
and can seriously affect assessment results.
The most common rating errors are leniency or severity,
central tendency, halo effect, rater effect, primacy and
regency effects, perceptual set, performance dimension
behavior, spill over effect and status effect.

E. How to Solve?
Trainning
Remedying outside factor
F. What should be rated? :What should be rated? One of the steps in designing
an appraisal programme is to determine the evaluation criteria .It is obvious that the
criteria should be related to the job. The six criteria for assessing performance are:

1. Quality: The degree to which the process or result of carrying out an activity
approaches perfection in terms of either conforming to some ideal way of
performing the activity, or fulfilling the activity’s intended purpose.

2. Quantity: The amount produced, expressed in monetary terms, number of

units, or number of competed activity cycles.

3. Timeliness: The degree to which an activity is completed or a result produced,

at the earliest time desirable from the standpoints of both coordinating with the
outputs of others and of maximizing the time available for other activities.
.
4. Cost of Effectiveness: the degree to which the use of the
organizations resources e.g.human, monetary, technological and
material) is maximized in the sense of getting the highest gain or
reduction in loss from each unit or instance of use of a resource.

5. Need for supervision: The degree to which a job performer can carry
out a job function without either having to request supervisory assistance
or requiring supervisory intervention to prevent an adverse outcome.

6. Interpersonal impact: The degree to which a performance promotes

feeling of self-esteem, goodwill and cooperation among co-workers and
subordinates
H. Methods of Appraisal :Methods of Appraisal Numerous methods have been
devised to measure the quantity and quality of employees’ job performance.
Each of the methods discussed could be effective for some purposes, for
some organizations. None should be dismissed or accepted as appropriate
except as they relate to the particular needs of the organization or of a
particular type or employees. Broadly, all the approaches to appraisal can
be classified into

I) Past-oriented methods

I) II) Future-oriented methods

Past-oriented Methods: :Past-oriented Methods:
Rating scales
Checklists
Forced choice method
Critical incident method
Field review method Performance tests and observations
Annual confidential reports
Essay method
Cost accounting approach
Comparative evaluation approach

Future Oriented tests:

:Future Oriented tests:
Management by objective
360-Degree appraisal
Psychological appraisals
Assessment centers
•Measure the performance

•Need to measure performance and not mere activity

Performance to job include following elements

1.Quantity of output

2.Quality of output

3.Timeliness of output

4.Presence at work

5.Cooperativeness
•To change behaviour of employees whose performance does not meet
organisationalrequirement or there own personal goals

•To maintain the behaviour of employees who perform in acceptable

manner

•To recognise superior performance behaviour so that they will be

continued

Methods
Tell and sell
Tell and listen
Problem solving
mixed
Organisations need to store the data so that at any point in future, the
Information can be retrieved and used.
The final step in evaluation process . The data and information generated through
performance evaluation must be used by the HR dept., the data and information will
be useful in the following areas in HRM:

1. Remuneration administration

2. Validation of selection programmes

3. Employee training and development programmes

4. Promotion, transfer and lay-off decisions

5. Grievance and discipline programmes

6. HR planning.
 ESSAY APPRAISAL METHOD

• This traditional form of appraisal, also known as

"Free Form method" .

• involves a description of the performance of an

employee by his superior.
 STRAIGHT RANKING METHOD

• This is one of the oldest and simplest techniques of

performance appraisal.

• In this method, the appraiser ranks the employees from the

best to the poorest on the basis of their overall performance.
 PAIRED COMPARISON

• A better technique of comparison than the straight ranking

method.
• This method compares each employee with all others in
the group, one at a time. After all the comparisons on the
basis of the overall comparisons, the employees are given
the final rankings.
 CRITICAL INCIDENTS METHODS

• In this method of Performance appraisal , the

evaluator rates the employee on the basis of
critical events.
• It includes both negative and positive points.
 FIELD REVIEW

• In this method, a senior member of the HR department or a

training officer discusses and interviews the supervisors to
evaluate and rate their respective subordinates.

• this method helps to reduce the superiors’ personal bias.

 CHECKLIST METHOD

• The rater is given a checklist of the

descriptions of the behavior of the employees
on job.
 GRAPHIC RATING SCALE

• In this method, an employee’s quality and quantity of

work is assessed in a graphic scale indicating
different degrees of a particular trait.

• For example a trait like Job Knowledge may be

judged on the range of average, above average,
outstanding or unsatisfactory.
 FORCED DISTRIBUTION

• To eliminate the element of bias from the rater’s

ratings, the evaluator is asked to distribute the
employees in some fixed categories of ratings like on
a normal distribution curve.
 Modern Method
• ASSESSMENT CENTRES -

An a central location where managers may come

together to have their participation in Job-related
exercise evaluated by trained observers.
 MANAGEMENT BY OBJECTIVES
• 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.
MBO PROCESS
 Behaviorally Anchored Rating Scales

• In this method, an employee’s actual job behavior is judged

against the desired behavior by recording and comparing the
behavior with BARS.

• Developing and practicing BARS requires expert knowledge.

 HUMAN RESOURCE ACCOUNTING METHOD

• In this method the performance appraisal of the employees is

judged in terms of cost and contribution of the employees.
 360 degree feedback

• The 360-degree techniques is understood as systematic

collection of performance data on an individual or
group, derived from a number of stakeholders.

• This typically includes the employee's manager, peers, and

direct reports.
Challenges of performance
appraisal
 Challenges of performance
appraisal
• Create a culture of excellence that inspires
every employee to improve and lend
himself or herself to be assessed.

• Align organizational objectives to

individual aspirations.
 Challenges of performance
appraisal
• Clear growth paths for talented individuals.

• Provide new challenges to rejuvenate

careers that have reached the plateau
stage.
• Empower employees to make decisions
without the fear of failing.
APPRAISING TEAM
 Identify KRAs critical to business during the year

Set tangible targets for Each KRAs. Incorporate stretch Elements for
each target Fix the minimum Acceptable target

Determine intangible parameters Which indicate Pockets of individual

Excellence with the team.

Evaluate performance of the team against predetermined targets

Communicate the results to ensure transparency.

Measure the performance of the team actual vs. targets Every month.

Identify individuals who have excelled. Discount subjective factors by

including assessors from outside the team to identify outstanding Individuals.
Thank
You