Performance Appraisal

Presented by
Anjili Gupta
Student regd no-221214681/08/2011

1
 Acknowledgement
 I have taken efforts in this project. However, it would not have been possible without
the kind support and help of many individuals . I would like to extend my sincere
thanks to all of them.
 I am highly indebted to the institute of company secrtaries of India for a wonderful
video sessions through which I could select content of my topic as well as for providing
necessary information regarding the project.
 I would like to express my gratitude towards my parents for their kind co-operation and
encouragement which help me in completion of this project.
 I would like to express my special gratitude and thanks to industry persons for giving
me such attention and time.
 My thanks and appreciations also go to my colleague in developing the project and
people who have willingly helped me out with their abilities

2
 List of Appendices
 Introduction-----------------------------------------------------------------------5
 Objective of performance appraisal -----------------------------------------6
 Process of performance appraisal -----------------------------------------7-8
 Challenges of performance appraisal ---------------------------------------9
 Methods of performance appraisal ------------------------------------10-14
 Benefits of performance appraisal------------------------------------------15
 Designing performance appraisal programme---------------------------16
 Requirement of sound performance appraisal programme-----------17
 Modern trends in performance appraisal-----------------------------18-19
 360 degree feedback--------------------------------------------------------20-24
 Tips for success of performance appraisal----------------------------25-26
 Bibliography--------------------------------------------------------------------27
3
 Introduction
Performance appraisal is the process of obtaining, analysing
and recording information about the relative worth of an
employee.
It aims at measuring ‘ what an employee does’
As per B. Filippo ‘ performance appraisal is the systematic,
periodic and impartial rating of an employee’s excellence in
the matters pertaining to his job and his potential for a
better job’

4
 Objectives
 Performance review and understanding the cause behind under
and over performance.
 Maintaining organizational control.
 Diagnosing strength & weakness of the members to help design
training & development programmes.
 Clarifying expectations and responsibility of employees
 Reducing worker grievances.
 Judging effectiveness of recruitment, selection, orientation,
training and development.
5
 Process of performance appraisal
 Establishing, communicating and explaining performance
standard
 Measuring actual performance
 Comparing actual performance with desired performance and
determining the deviation
 Discussing result on one to one basis to identify causes and
develop futuristic feedback
 Decision making as to corrective action such as revising the
standard, rewarding, promoting or demoting workers or transfer
etc.
6
7
 Challenges
 It is very difficult to set quantifiable, measuring and
objective set of performance appraisal standard
 Determining rating instrument or the tool such as
procedures, periodicity
 Lack of competence with raters or evaluators
 Errors in rating and evaluation due to involvement of bias
and lack of objectivity
 Resistance from employees and union

8
 Methods of performance appraisal
in order to assess the worth or merit of any employee traditional and
modern methods are applied as shown below

 Traditional method
They are trait oriented appraisal. Evaluation of employee is done on the basis of standard of
personal trait or qualities such as attitudes, judgement, versatility, initiative, leadership etc.
Traditional methods are:-
 unstructured appraisal:- under this appraiser is required to write down his impression
about the person being appraised
 Ranking method:- ranking is a simple process of placing employee in a rank according
to their job performance. It permits comparison of all employees in any single rating
group regardless of the type of work
 Forced distribution method:- it is devised to force the appraiser to fit the employees
being appraised into predetermined ranges of scale. This system is base on the
presumption tes can be divided into five points scale of outstanding, above average,
average, below average, poor. 9
Continued………..
 Graphic rating scale method:- under this method scales are established for a
number of specific factors and qualifies against which workers performance is
appraised. Five degrees are established for each factor and general definitions
appear at point along the scale.
 Weighted checklist method:- under this method various statements are
prepared in such a manner that they describe various types and level of
behaviour for a particular job. Each statement is attached with a scale value. At
the time of rating the employees, the supervisor just collects and check all the
statements. After the weights or values are attached to the individual traits, the
rating is gathered on the rating sheet. Then the weights are averaged and
evaluated. Employees are ranked from poor to excellent.

10
 Modern method

 Management by objectives:-

11
 Under this approach an employee is not appraised by hia recognisable traits but by his
performance with respect to the agreed goals or objectives. MBO involves following
steps:-
the subordinate discusses his job descriptions with his superior and they agree on the
contents of his job and the key results areas

the subordinate prepares a list of reasonable objectives for the coming period of six to
twelve months

he sits with his superior to discuss these targets and plans and a final set is worked out

check points are established for the evaluation of progress and the ways of measuring
progress are selected

the superior and the subordinate meet at the end of the period to discuss the results of
the subordinate’s efforts to meet the targets mutually established.

There is emphasis on problem solving rather than criticism of the performance of the
subordinates
12
 Behaviourally anchored rating scales
 It is output focussed method of performance appraisal. Under this technique
behaviourally anchored rating scales are designed to:
 Identify the critical areas of performance for a job
 To describe the more effective and less effective job behaviour for getting
results
 Process of setting BARS is as follows:-
 identify important job dimension .
 Write short statements of job behaviour
 Assign statements to job dimensions
 Set scales for anchors

13
14
 Designing performance appraisal

15
 Requirements of sound
performance appraisal
 Simple to operate and easy to understand
 Performance based, uniform and non-variables, fair, just and equitable
 Employees should be made aware of the performance in terms of goals, targets,
behaviour etc expected of them
 The appraisal plan should be devised in consultation with the subordinates
 Create climate of reliable appraisal throughout the organisation
 The appraiser should be selected and trained properly
 There should be provision of appeals against appraisals

16
 Modern trend in performance
appraisal
 The performance appraisal process has become central to modern HR practices
responsible for performance management. The emerging trends are as follows:-
 Career development orientation to explore and utilize worker potential
 More detailed, structured, analytical and person specific
 Trend toward 360 degree feedback
 Orientation toward anticipation of problem to not allow them happen
 Both team and individual appraisal over stress upon individual performance appraisal
may bring unhealthy competition. At maruti udyog ltd individual performance of
technician is measured in terms of timely attendance and proper leave planning.
Productivity appraisal are collective and even organisation mode
 Rank and yank strategy:- such a hard approach is also adopted particularly by ford,
Microsoft and sun micro system. It is known as up or out policy i.e. after performance
appraisal either improve during the given time or leave the organisation. It ranks
performance on a scale ranging between best to worst. Poor performers are given
17
improvements opportunities but with time management
Balanced score card:- it is a measure of team performance. All factors are given due
significance.

Performance management:- it is a modern approach to bringing productivity. Traditional

performance appraisal focus upon fault finding and post mortem exercises.
But modern practices advocates that just appraisal is not sufficient. Efforts of every
employee must focus like laser on helping company to achieve its strategic goals.
It requires an integrated performance management approach to guiding, developing and
appraising employees.
In this regard performance management is a process that consolidates goal setting,
performance appraisal and worker training development into single common system.
It aims to ensure that the employee’s performance is supporting the attainment of
company’s strategic aims. In this sense it plays role of enabling employees rather than
putting the employee a court to find his/ her fault
Accordingly central philosophy of performance management is each employee must
continually improve his/her personal performance from one appraisal period to another.

18
 360 degree feedback

19
It is also known as multi source assessment or multi-rater feedback
it is a comprehensive appraisal of employees performance from all the sources :-
peers, direct reportees, manager, cutomers that comes in contact with the
employee on his job
 Feedback is taken from multiple sources
 Feedback ratings are gathered against various performance dimension
 Feedback may be presented directly to individual or to their managers or both
 Expert counselling and coaching for individual as a result of the feedback may
be provided by a member of the HR department or by an outside consultant
 Need for 360 degree feedback:-
 Inability of managers to observe workers from every angle
 Generating awareness of any discrepancy between how we see ourself and how
others see us
 Aligning leaders behaviour, work unit result and customer expectation
 Increasing self awareness and employee participation in leadership
development and work unit effectiveness
20
 How to implement it?

21
 Tips to make 360 feedback a
success

22
 Pros and cons of 360 degree
feedback

23
 Tips for success of performance
appraisal
 1. First of all, you have to acknowledge they are necessary.
 They may seem like a hassle, but the truth is, your team needs them. With all of the
hype against performance reviews lately, you might think your team can get by on
intermittent feedback alone
 2. Underline what you want your employee to learn from the performance
appraisal.
 Other than simply “good job on project XYZ,” and “I think this could be
improved,” this meeting with your employee should have a goal. What bit of
knowledge do you want them to leave the performance appraisal with? Give them
practical ways to improve and grow after every appraisal.
 3. Ask your employee to come prepared for the meeting.
 Of course, you’ll be prepared and have your notes ready for the review, but it is a
two-way process. Your employee should come to the performance appraisal with
some questions and successes as well. If you expect your employees to be prepared
for the review, you have to be prepared for the performance appraisal as well. If not
for your own organization, for the success of the team.
24
Continued……
 4. Be open and willing to discuss challenges and successes.
 This is a safe zone. Your employees should feel comfortable talking about their challenges
and successes as a team member, just as they should be comfortable suggesting how your
team can provide better leadership. Ask them to identify three ways your team can lead them
better.
 5. Work with your employee to develop an action plan.
 Setting a performance plan to help employees improve their skills should be a collaborative
effort. Even if they have met or surpassed company performance standards, there’s nothing
wrong with setting high bars for your team. Select goals (2 is a good number) and work
backward into those goals and deadlines together. Pick reasonable deadlines, and identify
where support will help and how you will measure the success of the goal! Voila!
 6. Underscore what you will do to help them meet goals.
 Understanding what your employee needs to hit the goals you both have just set in the above
tip is crucial to their success. Nearly 80% of workers feel more appreciated when their
strengths are emphasized, and 64% believe they would be more successful in the office if
they can build on those strengths. [3] By outlining what you will do to help them reach their
goals, you help them to build on those strengths. Just as you want your employee to commit
to the plan, your management will need to commit to supporting that plan with resources,
tools or assistance at specific intervals.
 7. Express continuing support.
 Ensure your team understands you support them and ask what you can do to show that
support. Check in periodically on the progress of their action plan or their goals and make
sure they have the tools and resources they need in order to be successful. 25
 Bibliography

 HUMAN RESOURCE MANAGEMENT 11TH EDITION – STEPHEN P

ROBBINS
 WIKIPEDIA
 RANKER’S CLASSES NOTES

26