What is Performance Appraisal? Just what it sounds like! We’ve all undergone performance appraisal in the course of our everyday lives—many times. In I/O psychology, we’re talking about performance appraisal in organizational life. Performance appraisal is thus defined as “the systematic review and evaluation of job performance, as well as the provision of performance feedback.” . . . why go through such a process?
RatingFormats How is a performance appraisal implemented? Organization decides on goals. Goals given to employee. Good behavior will be reinforced. So, process of conducting P.A. process pretty simple. What’s hard to determine are the specifics. Leads to our first question: What’s the best rating format or scale for measuring performance appraisals? For years, deciding on the right rating format for conducting appraisal seen as the absolute key to a system’s success.
Research Questions (Levy, 2010) The main research questions of P.A. can be summarized as: What’s the best rating format or scale for measuring performance appraisals? Raters must use some sort of instrument to measure performance; options typically referred to asrating formats or rating scales. How much do rater errors and biases affect actual P.A. process? Can rater training programs prevent influence of errors and biases on ratings? How important is social context versus rating formats/errors in evaluation of P.A.? What aspects of the social-psychological context have impact on P.A. process? What aspects of P.A. processes have been shown to affect ratees’ reactions to their appraisal and feedback?
RaterError However, rating systems are not entirely objective, and so long as supervisor ratings of their subordinates are even slightly based on subjective decisions, room always remains for human biases and perceptions to easily sneak in and distort the appraisal process. Understanding how errors occur starts with understanding the expectations of supervisor or other rater. Easy for mistakes to slip in unintentionally at any step in the cognitive processing of employee behavior. For years, performance appraisal was evaluated in the context of rating format and rater errors: The key to the perfect appraisal system was finding the perfect rating format. And the chief goal of any performance appraisal system was itsaccuracy(lack of rater errors).
Modern Issuesin Performance Appraisal Importance of Social-Psychological Context: Reaction criteria vs. accuracy. Supervisor/subordinate relationships. Organizational politics. Importance of trust. Multiple feedback sources. Appraisal system knowledge + participation. Movement away from errors.. ..towards increased understanding of process.
Performance Appraisal & Cultural Context Very little research investigating the extent to which our current performance appraisal systems translate across cultures. A few studies have been conducted: “East Asians” and “Westerners” have different psychological processes, aptitudes for certain skill tasks. In India, workers have different relation with bosses.
Company Performance Appraisal Comparison Chevron: Vertically-integrated Promotions to the top Performance Management Process “Bringing out the best” appraisal program. Hitachi: Horizontally-integrated Pay raises Fast-Pass Promotion Program
References Brown, M., Hyatt, D., & Benson, J. (2010). Consequences of the performance appraisal experience. Personnel Review, 39(3), 375-396. DeNisi, A. S., & Pritchard, R. D. (2006). Performance appraisal, performance management and Improving individual performance: A motivational framework. Management and Organization Review, 2(2), 253-277. Hitachi: Living together with society. (2009). Hitachi Group Social Responsibility Report, 24-25. Retrieved from http://www.hitachi.com/csr/csr_images/csr2009e_052-087.pdf Levy, P. E. (2010). Performance appraisal. Industrial/Organizational Psychology (pp. 104-129). New York, NY: Worth Publishers. MacDonald, H. A., & Sulsky, L. M. (2009). Rating formats and rater training redux: A context-specific approach for enhancing the effectiveness of performance management. Canadian JournalofBehavioural Science, 41(4), 227-240. Narcisse, S., & Harcourt, M. (2008). Employee fairness perceptions of performance appraisal: A Saint Lucian case study. The International Journal of Human Resource Management, 19(6), 1152-1169. Payne, S. C., Horner, M. T., Boswell, W. R., Schroeder, A. N., & Stine-Cheyne, K. J. (2009). Comparison of online and traditional performance appraisal systems. Journal of Managerial Psychology, 24(6), 526-544. Varma, A., Pichler, S., & Srinivas, E. S. (2005). The role of interpersonal affect in performance appraisal: Evidence from two samples - the US and India. International Journal of Human Resource Management, 16(11), 2029-2044. Yun, G. J., Donahue, L. M., Dudley, N. M., & McFarland, L. A. (2005). Rater personality, rating format, and social context: Implications for performance appraisal ratings. International Journal of Selection and Assessment, 13(2), 97-107.