Performance Appraisal

A formal system of PERIODIC (not sporadic) review and evaluation of an individuals or teams job performance.

The process by which an employees contributions towards meeting the mandate of the organization during a specified period of time is assessed.

Performance Appraisal - Purpose

Improving communication between boss and subordinates through feedback mechanism. Planning human resources. Predicting employees performance. Identifying training needs. Planning for career and development. Determining promotion, rewards and remuneration or otherwise. Strengthening employer employee relations. Assessing employee potential for entrusting them higher level of responsibilities.

Components of Appraisal Processes:

Defining Performance - Linking individual performance to organizational objectives (tuning/alignment) Measuring Performance Multiple performance criteria. Feedback and Coaching, Counselling, Monitoring and Mentoring- Feedback on past performance and help to SET and MEET next performance targets.

Methods of Performance Appraisal

1. 360-Degree Feedback A multi-rater evaluation that involves input from multiple levels within the firm and external sources as well. 2. Rating Scales Employees are rated according to defined factors. 3. Critical Incident consists of a written record of highly favourable and highly unfavourable employee work.

4. Essay Rater records a brief narrative describing employees performance.

5. Work Standards employees performance is compared to a predetermined standard levels of output.

6. Ranking the Rater places subordinates in rank order of overall performance. 7. Paired Comparison every employee to be rated is paired with and compared to every other subordinate on each trait. 8. Forced Distribution the rater assigns employees in a work group to a limited number of categories similar to a normal frequency distribution. 9. Forced-Choice the rater is given a series of statements about an individual and indicates which items are most or least descriptive of the employee.

10. Behaviourally Anchored Rating Scales Combination of the traditional rating scale and critical incident methods. 11. Results Based Systems/Management by Objectives (MBO) Manager and the subordinate jointly agree on objectives for the next appraisal period. 12. Assessment Centres

Problems in Performance Appraisal 1. Lack of Objectivity 2. Halo Error 3. Leniency / Strictness 4. Central Tendency

5. Recent Behaviour Bias

6. Personal Bias 7. Manipulating the Evaluation

Individual Performance

There is a growing recognition that the work performance of people in organizations comes primarily from within, but is also powerfully affected by the social, economic and political environment in which people work.
Individual Performance = Energy (Physical and Mental) Capabilities (Competencies) Level of Motivation x External Factors (Environment)

Performance Management
It is a process that significantly affects organizational success by having managers and employees work together to set expectations, review results, and reward performance. Employees work behaviours are aligned with the organizations goals.

Performance Appraisal and Performance Management

Performance Management Creating a shared vision of the purpose and aims of the organisation, helping each individual employee understand and recognise his/her part of contributions towards organization and in doing so, manage and enhance the performance of both: a. b. the individuals, and the organization.

Performance Management integrates both at the conceptual and practical levels. These include:
Business planning Performance indicators Benchmarking for performance Competence-based education and training Clinical audit of performance Non-monetary rewards Performance-related pay Use of assessment and development centres Performance appraisal

Performance Management System

1. Business Ingredients
Job Description Job Skills / Knowledge Individual Skills / Knowledge Team Business Objectives

Plan
2. Performance Planning

4. Performance Measurement Evaluation

3. Performance Development

Action