EVALUATING EMPLOYEE

PERFORMANCE
PERFORMANCE APPRAISALS
▪ Formalized means of assessing worker performance in

comparison to certain established organizational standards

▪ Career advancement

▪ Salary increment, promotion

▪ Feedback

2
MEASUREMENT OF JOB PERFORMANCE
▪ Performance criteria – measures used to determine

successful and unsuccessful job performance

▪ Objective (Hard) – easily quantifiable

▪ Subjective (Soft) – ratings or judgments of performance

3
Objective performance criteria

▪ Less prone to bias & distortion

▪ Directly tied to bottom-line assessment of organization’s

success

▪ Difficult to obtain for certain jobs

▪ Too much focus on quantifiable outcomes

4
Sources of performance rating

▪ Supervisor appraisals

▪ Self-appraisals

▪ Peer appraisals

▪ Subordinate appraisals

▪ Customer appraisals

▪ 360-degree feedback

5
Supervisor appraisals

▪ Performed by supervisor

▪ Supervisors know about job requirements

▪ Position to provide rewards for effective performance

▪ High reliability than peer ratings

▪ High test-retest reliability

6
Self-appraisals

▪ Correlate slightly with supervisor performance appraisals

▪ More lenient

▪ Focus more on effort exerted than on performance

accomplishments

▪ Highlight differences in supervisor and worker perceptions

7
Peer appraisals

▪ Good agreement between performance ratings by peers

and supervisors

▪ Conflict among employees

▪ Competition for scarce job rewards

8
Subordinate appraisals

▪ Assess effectiveness of persons in supervisory positions

▪ Considerable agreement with supervisor ratings

▪ Different, meaningful perspective on supervisor’s

performance

9
Customer appraisals

▪ Employees working in customer service can be rated by

customers

▪ When employee and customer have significant, ongoing

relationship

10
360-degree feedback

▪ Comprehensive form of performance appraisal

▪ Performance ratings are gathered from supervisors,

subordinates, peers, customers

▪ Improved reliability

▪ High cost
11
METHODS OF RATING PERFORMANCE
Comparative Methods Individual Methods

▪ Rankings ▪ Graphic rating scales

▪ Behaviorally anchored rating scales

▪ Narratives

12
 Comparative Methods
Rankings

▪ Ranking of supervisees from best to worst on specific

performance dimensions, or overall comparative ranking

on job performance

▪ Simple, easy, less time consuming

▪ No absolute standard of performance

13
Paired comparisons

▪ Rater compares each worker with each other worker in the

group

▪ Each person’s final rank consists of the number of times

that individual was chosen as the better of a pair

▪ Simple, applicable to variety of jobs

14
Forced distributions

▪ Assigning workers to established categories of poor to

good performance with fixed limitations on how many

employees can be assigned to each category

▪ Abundance of either very good or very poor workers

15
 Individual Methods

Graphic rating scales

▪ Predetermined scales to rate the worker on a number of

important aspects of the job

▪ 7 to 12 key job dimensions - derived from the job analysis

▪ Takes time to develop, Applicable to variety of jobs

▪ Prone to biased response patterns

▪ Rating scales with labels reflecting examples of poor,

average, and good behavioral incidents

▪ Lengthy, tedious to develop

▪ Focuses on performance behavior relevant to a particular

job
17
18
Behavioral observation scales (BOS)

▪ It require appraisers to recall how often a worker has been

observed performing key work behaviors

▪ BARS - expectations that a worker would be able to

perform specific behaviors that are typical of certain

▪ BOS - concentrate on critical behaviors that were actually

performed
19
Checklists

▪ Series of statements about performance in a particular job

▪ Check off the statements that apply to the worker being

evaluated

▪ Each statements is given a numerical value reflecting the

degree of effective performance associated with it

▪ Choose among finite set of statements

22
Narratives

▪ Open-ended written accounts of a worker’s performance

▪ Freedom to describe performance in your own words and

to emphasize elements that you feel are important

▪ No quantification

23
PROBLEMS IN PERFORMANCE APPRAISALS
▪ Leniency/severity error

▪ Halo effect

▪ Recency effect

24
Leniency/severity error

▪ Tendency to give all workers very positive performance

appraisals

▪ Negative performance appraisals

▪ Central tendency error - Appraiser tends always to use

the midpoint of the rating scale

25
Halo effect

▪ An overall positive evaluation of a worker based on one

known positive characteristic or action

Reverse halo effect

▪ Overall negative evaluation is made on the basis of one

instance of failure or one negative characteristic

▪ Tendency to give greater weight to recent performance

and lesser value to earlier performance

27
28
THE END