Performance Appraisal Methods

Here’s a concise summary of the traditional tools for appraising performance, based on your
input:

1. Graphic Rating Scale Method

 Simplest and most popular method.

 Lists job dimensions (e.g., communication, teamwork) with performance values (e.g.,
“unsatisfactory” to “outstanding”).
 Supervisors rate employees for each trait and total the scores.
 Variants include competency-based scales, behavioral competencies, and goal-based
scales.

2. Alternation Ranking Method

 Ranks employees from best to worst on specific traits.

 Starts by identifying the highest and lowest performers, then alternates between the next
highest and lowest.
 Simplifies comparison but may lack precision.

3. Paired Comparison Method

 Compares each employee with every other employee for each trait.
 Uses a chart to determine rankings (e.g., who is better in quality or creativity).
 Provides precise comparisons but is time-consuming.

4. Forced Distribution Method

 Assigns employees into fixed performance categories (e.g., top 15%, middle 75%, bottom
10%).
 Prevents bias in ratings but may damage morale and create stress.

5. Critical Incident Method

  Supervisors keep logs of positive and negative job-related behaviors.
 Logs are used during periodic performance discussions.
 Helps anchor appraisals in reality but doesn’t provide relative ratings for pay decisions.

6. Behaviorally Anchored Rating Scales (BARS)

 Combines numerical ratings with specific examples of performance.

 Developed through five steps: writing incidents, grouping them into dimensions,
verifying groupings, scaling incidents, and finalizing the tool.
 Provides clarity and objectivity but requires significant time to develop.

7. Management by Objectives (MBO)

 A goal-oriented method where employees and managers set measurable goals.

 Involves multiple steps, from setting organizational goals to conducting periodic reviews.
 Time-consuming but fosters alignment with company objectives.

Modern Variants and Tools

 Forms: Simple but inefficient as headcount grows.

 Computerized/Cloud-Based Systems: Expedite appraisals and often integrate with
talent management systems.
 Electronic Performance Monitoring (EPM): Tracks performance digitally but may
increase stress.

Appraising Performance Problems and Solutions

Performance appraisal is an essential process for evaluating employee contributions and
determining areas for improvement. However, the process can be susceptible to various problems
that affect the accuracy and fairness of the assessments. These problems, known as rater errors,
arise when evaluators fail to assess employee performance objectively and consistently. Here’s a
detailed breakdown of potential appraisal problems and practical solutions:

1. Unclear Standards:
  Problem: Appraisal scales with ambiguous terms like "good," "fair," or "excellent" can
lead to inconsistent ratings. For example, different supervisors may have different
interpretations of "quality of work," making performance assessments unreliable.
 Solution: To avoid this, clear and specific definitions should be included in rating forms.
Descriptive phrases that outline what traits like "Role Model" or "Below Expectations"
mean in measurable terms lead to more consistent and easily explained appraisals.

2. Halo Effect:

 Problem: The halo effect occurs when a supervisor's overall impression of an employee
influences how they rate specific traits. For example, if a manager generally likes an
employee, they may rate them highly on all performance aspects, even if their actual
performance on specific tasks doesn't warrant it.
 Solution: Supervisors should be trained to assess employees independently on each
performance dimension. Using tools like Behaviorally Anchored Rating Scales
(BARS), where performance dimensions are more independent of each other, can help
mitigate this issue.

3. Central Tendency:

 Problem: In central tendency, raters tend to rate all employees as average, avoiding
both the extremes of the rating scale. For instance, a supervisor may rate everyone
between 3 and 5 on a 7-point scale, leading to a lack of differentiation between
employees.
 Solution: Ranking employees rather than using a graphic rating scale forces supervisors
to distinguish between high and low performers. Alternatively, employers can implement
a forced distribution, requiring that a specific percentage of employees fall into each
performance category.

4. Leniency or Strictness:

 Problem: Supervisors with a lenient or strict approach tend to rate all employees
similarly—either too high or too low—distorting the accuracy of the evaluation. For
example, a lenient manager might rate everyone "excellent," even when their
performance varies.
 Solution: Supervisors should be encouraged to apply a more balanced approach,
avoiding overly lenient or strict ratings. A forced distribution (e.g., 10% rated as
excellent, 20% as good) can help ensure that ratings are more evenly distributed. It’s
important, however, to acknowledge that this method may not always reflect actual
performance if all employees are performing well.
6. Bias:

 Problem: Bias refers to the influence of personal characteristics (e.g., age, race, gender)
on the performance evaluation. Research has shown that evaluators may rate individuals
differently based on their demographic traits, even when their actual performance is
similar.
 Solution: To minimize bias, it’s crucial to have multiple raters for each employee, review
ratings by a supervisor’s superior, and conduct calibration meetings where managers
discuss and standardize appraisals. Ensuring diversity in the appraisal process can help
reduce bias and promote fairer evaluations.

Best Practices for Fair Appraisals:

 1. Set Clear Standards: Ensure all employees understand the criteria and the
expectations for each rating level.
 2. Use Multiple Raters: Incorporate feedback from several sources to minimize
individual bias and provide a more balanced evaluation.
 3. Provide Training for Supervisors: Equip managers with the skills to deliver fair
appraisals by training them in both technical and interpersonal aspects of the evaluation
process.
 4. Regularly Review and Update Appraisal Systems: Ensure the appraisal system
evolves based on feedback and remains aligned with organizational goals.
 5. Foster Open Communication: Allow employees to share their own views on their
performance, which encourages transparency and trust in the appraisal process.

The appraisal interview and the role of Appraisal in

Managing performance
The Appraisal Interview is an essential part of performance management where managers
provide feedback to employees on their performance. These interviews help in clarifying the
expectations, acknowledging achievements, and addressing any performance issues. There are
different types of appraisal interviews, and each requires a unique approach to be effective. Let’s
go through the various types and the guidelines for conducting a productive interview.

Types of Appraisal Interviews

1. Satisfactory—Promotable:
o In this type of interview, the employee’s performance is rated highly, and they are
considered ready for promotion. The focus should be on recognizing the
 employee’s contributions, highlighting strengths, and discussing the potential
career growth opportunities.
o Focus: Growth, development, and future opportunities.
o Objective: Provide motivation and guidance on the next steps toward promotion.
2. Satisfactory—Not Promotable:
o Here, the employee’s performance is satisfactory, but they are not yet ready for
promotion. This could be due to the employee not having the necessary skills or
experience required for the next level.
o Focus: Recognition of good work and setting clear development goals to help the
employee continue improving.
o Objective: Encourage continued strong performance and clarify areas for future
growth.
3. Unsatisfactory—Correctable:
o In this scenario, the employee's performance is unsatisfactory, but the issues are
identifiable and can be addressed with corrective action. This type of interview is
often focused on giving constructive feedback and creating a plan for
improvement.
o Focus: Identifying the problems, setting clear goals for improvement, and
offering support.
o Objective: Help the employee understand the issues and guide them through
corrective actions.
4. Unsatisfactory—Uncorrectable:
o When an employee’s performance is unsatisfactory, and there is little room for
improvement, the focus shifts to exploring possible consequences, including
termination or reassignment. This interview type requires a high level of
sensitivity and clarity.
o Focus: Addressing performance gaps, setting clear expectations, and discussing
consequences.
o Objective: Ensure that the employee understands their performance issues, the
consequences, and the next steps.

Guidelines for Conducting an Appraisal Interview

To ensure that the performance appraisal interview is constructive, professional, and productive,
here are some key guidelines for managers:

1. Talk in Terms of Objective Work Data:

o Base the discussion on concrete facts and measurable outcomes rather than
subjective opinions or emotions. This helps in making the appraisal process more
transparent and objective.
o Example: Instead of saying, “Your work has been lacking,” say, “In the last
quarter, your projects were completed two weeks past the deadline, and the
quality didn’t meet our standards.”
2. Don’t Get Personal:
 o Focus on the employee’s work performance rather than personal characteristics or
behaviors. Avoid making any comments that could be perceived as personal
criticism, which could negatively affect the employee's morale.
o Example: Instead of saying, “You’re always late,” try, “There have been delays
in your project submissions which have impacted deadlines.”
3. Encourage the Person to Talk:
o Give the employee an opportunity to share their perspective, thoughts, and
concerns. This not only makes the process more collaborative but also shows that
you value their input and want to understand any challenges they may be facing.
o Example: “Can you tell me about any challenges you’ve encountered in your role
recently?”
4. Get Agreement:
o It’s important to ensure that both you and the employee are on the same page
regarding their performance and the actions required moving forward. This can be
achieved by setting specific, measurable goals for the employee.
o Example: “Do you agree that completing your projects on time and with higher
quality is an area we need to focus on?”

MAAM SOLAT TOPICS

How to Handle a Defensive Subordinate

1. Recognize that Defensive Behavior is Normal:
o Understand that defensive reactions are a natural response to perceived threats,
criticism, or stress. Employees may feel vulnerable or embarrassed, leading them
to react defensively. This could manifest as denial, excuses, or even aggression.
o Action: Approach the conversation with empathy, acknowledging that their
defensiveness is a common emotional response and not necessarily a sign of
hostility or disengagement.
2. Never Attack a Person’s Defenses:
o Attacking or confronting a defensive employee head-on can escalate the situation.
Avoid directly challenging their defenses or becoming confrontational. This will
only make them more defensive and close off the conversation.
o Action: Instead of saying, "You're just making excuses," try reframing the
situation. For example, “I understand you feel there are challenges, but let’s focus
on what we can do together to improve the situation.”
3. Postpone Action:
o If an employee becomes highly defensive and isn’t receptive to feedback, it’s best
to postpone decisions or actions until they are in a better emotional state to engage
productively.
o Action: Calmly suggest, "It seems like we’re both getting frustrated. How about
we take a break and revisit this conversation tomorrow?" This gives both parties
time to cool down and reflect on the situation.
4. Recognize Your Own Limitations:
 o Recognizing that you, as a manager or supervisor, have your own biases, triggers,
and limitations is crucial for navigating a defensive conversation. If you feel
triggered by the subordinate’s defensiveness, it may cloud your judgment and
hinder a constructive discussion.
o Action: Before reacting, take a deep breath and assess the situation with a clear
mind. If necessary, acknowledge that you may not have all the answers and invite
the employee to provide their perspective. This shows humility and helps reduce
defensiveness.

Performance Management
• Performance Management
 Is the continuous process of identifying, measuring, and developing
the performance of individuals and teams and aligning their
performance with the organization’s goals.
• How Performance Management Differs From Performance Appraisal
 A continuous process for continuous improvement
 A strong linkage of individual and team goals to strategic goals
 A constant reevaluation and modification of work processes

Basic Building Blocks of

Performance Management
 Direction sharing
 Goal
alignment
 Ongoing performance monitoring
 Ongoing
feedback
 Coaching and development support
 Rewards, recognition, and compensation

FOR THE REST READ SLIDES CHAP 9