Performance appraisal of employees is one of the most efficient methods for employees’ development, motivation and evaluation.  Performance appraisal systems are typically used to measure the effectiveness and efficiency of an organization's employees.  The objective of performance reviews is to help ensure employee productivity is sufficient to meet the overall organizational objectives outlined in the Strategic HRM plan. HR professionals and management usually develop an appraisal system so employee performance can be evaluated on a regular basis.  This system also normally includes a set of formal policies to help deal with performance issues in the workplace. The advantage of having such a policy is that it can eliminate wrongful termination legal action.

1. Managing
Employee
Performance

2. Performance
appraisal
• Performance appraisal of employees is one of the most
efficient methods for employees’ development,
motivation and evaluation.
• Performance appraisal systems are typically used to
measure the effectiveness and efficiency of an
organization's employees.
• The objective of performance reviews is to help ensure
employee productivity is sufficient to meet the overall
organizational objectives outlined in the Strategic HRM
plan.
• HR professionals and management usually develop an
appraisal system so employee performance can be
evaluated on a regular basis.
• This system also normally includes a set of formal
policies to help deal with performance issues in the
workplace.
• The advantage of having such a policy is that it can
eliminate wrongful termination legal action.

3. Graphic Rating ScaleManagement by
Objectives
Work Standards
Approach
Behaviorally
Anchored Rating
Scale (BARS)
Ranking
Checklist scale
various
methods of
performance
assessment.
Critical Incident
Appraisals

4. Management
by Objectives
• One of the most widely used approaches to performance
appraisal is called Management by Objectives (MBO).
• Developed by Peter Drucker in his 1954 book The Practice of
Management.
Manager &
employee
meet
together
Together
develop
objectives
for the time
period
Time for PE,
the manager
& employee
sit down to
review
Determine
whether
they were
met.
• Advantage of this is the open communication, employee also
has 'buy-in' since he/she helped set the goals and the
evaluation can be used as a method for further skill
development.

5. To be efficient at MBOs, the managers and employees should be able to develop strong
objectives that are SMART (Specific, Measurable, Attainable, Relevant and Time-bound)

6. • The key disadvantage of this method is that it does
not allow for reasonable deviations (e.g. the
employee normally performs well). Thus,
this approach works best in situations
where a reasonable measure of performance can be
assessed over a certain period of time.
• This method is also used in manufacturing
environments where production output is vital. For
example, in an automotive assembly line, the focus is
on how many cars can be built within a set time so
employee performance is measured this way too.
• However, this method doesn't
allow for rating of other factors, such as ability to wor
k on a team or communication skills, which can be an
important part of the job, too.
• A BARS method allows performance to be assessed
along a scale with clearly defined scale points which
contain examples of specific behaviours. In this
system, there is a specific narrative outlining what
exemplifies a “good” and “poor” behavior for each
category.
• The advantage of this type of system is that it focuses
on the desired behaviors that are important to
complete a task or perform a specific job. This
method combines a graphic rating scale with a critical
incidents system.
Work Standards
Approach
Behaviorally
Anchored Rating
Scale (BARS)

7. The graphic rating scale, a behavioral method, is perhaps the most popular choice for performance evaluations.
This type of evaluation lists traits required for the job and asks the source to rate the individual on each attribute.
A discrete scale is one that shows a number of different points.
The ratings can include a scale of 1–10; excellent, average, or poor; or meets, exceeds, or doesn’t meet expectations
The disadvantage of this type of scale is the subjectivity that can occur.
This type of scale focuses on behavioral traits and is not specific enough to some jobs.
Development of specific criteria can save an organization in legal costs.
Many organizations use a graphic rating scale in conjunction with other appraisal methods to further solidify the tool’s validity.
Graphic Rating
Scale

8. Checklist scale
A checklist method for
performance evaluations lessens
the subjectivity, although
subjectivity will still be present
in this type of rating system.
With a checklist scale, a series of
questions is asked and the mana
ger simply responds yes or no to
the questions, which can fall into
either the behavioural or the tra
it method, or both.

9. In a ranking method system (also
called stack ranking), employees in
a particular department are ranked
based on their value to the
manager or supervisor.
This system is a
comparative
method for
performance
evaluations.
The manager will have a list of all
employees and will first choose the
most valuable employee and put
that name at the top. Then he or
she will choose the least valuable
employee and put that name at
the bottom of the list. With the
remaining employees, this process
would be repeated.
To make this type of
evaluation most valuable (and
legal), each supervisor should
use the same criteria to rank
each individual.
Obviously, there is room for
bias with this method, and it
may not work well in a larger
organisation, where managers
may not interact with each
employee on a day-to-day
basis.
Another consideration is the effect on
employee morale should the rankings
be made public. If they are not made
public, morale issues may still exist, as
the perception might be that
management has “secret” documents.
Ranking

11. The key internal and external that can lead to performance
issues are listed in the above table.
There is conflict with other employees or the manager.
The employee doesn’t have correct equipment or tools to
perform the job.
The goals or expectations are not in line with the
employee’s abilities.
The job design is incorrect.
The goals or expectations are not in line with the
employee’s abilities.
External motivation factors are absent.
The employee views unfairness in the workplace. There is a lack of management support.
The employee is dissatisfied with the job. The employee’s skills and job are mismatched.
Internal Factors External Factors

12. The Process for
Handling Performance Issues
Each individual job analysis should have rules and policies that apply to that specific job.
Model that can be used to develop policies around performance, for fairness and consistency.
Behaviour
Pattern
Persistent
Pattern
Disciplinary
Intervention
Single IncidentMandated Issue

13. Mandated Issue
• The mandated issue is serious and must
be addressed immediately.
• The mandated issue addressed immediately.
• Usually, a mandated issue is one that goes
beyond the company.
• Examples of mandated issues might include
an employee sharing information that
violates privacy laws, not following safety
procedures, or engaging in sexual
harassment.

14. Single Incident
• The second performance issue can be called a
single incident.
• Perhaps the employee misspeaks and insults
some colleagues or perhaps he or she was over
budget or late on a project.
• These types of incidents are usually best solved
with a casual conversation to let the employee
know what he or she did wasn’t appropriate.
• Consider this type of misstep a development op
portunity for your employee.

15. Behaviour Pattern
In this case, it’s important to
talk with the employee and let
him or her know what is
expected.
• Often when single incidents are not immediately
corrected, they can evolve into a behavior
pattern, which is our third type of performance
issue.
• This can occur when the employee doesn’t think
the incident is a big deal because he/she hasn’t
been correct before or may not even realize
they are doing something wrong.

16. Persistent Pattern
• If the employee has been
corrected for a behavior
pattern but continues to exhibit
the same behavior, we call this
a persistent pattern.
• Often you see employees
correct the problem after an
initial discussion but then fall
back into old habits.
• If they do not self-correct, it
could be they do not have the
training or the skills to perform
the job.
• If you believe the employee
just doesn’t have the skills or
knowledge to perform the job,
asking him or her about this
could be helpful to getting to
the root of the problem as well.

17. Disciplinary
Intervention
• If the employee continues to be nonperforming,
you may consider utilising a progressive
discipline process before initiating the employee
termination process.
• However, investigation of the performance issue
should occur before implementing any sort of
disciplinary action, which normally includes
an investigative interview with the employee.
• Another option for handling continued
infractions is to consider putting the employee
on an improvement plan, which outlines the
expectations and steps the employee should take
to improve performance.

18. Investigation of
Performance
Issues
• When an employee is having a
performance issue, often it is our
responsibility as HR professionals to
investigate the situation.
• Training managers on how to
document this is the first step in this
process.
• Proper documentation is vital should
the employee need to be terminated
later for the performance issue.
This documentation should
include the following
information:
Date of incident
Time of incident
Location of incident
A description of the
performance issue
Notes on the
discussion with the
employee on the
performance issue
An improvement plan,
if necessary
Next steps, should the employee commit the same infraction: Signatures
from both the manager and employee

19. • With this proper documentation, the
employee and the manager will clearly know
the next steps that will be taken should the
employee commit the infraction in the
future.
• Once the issue has been documented, the
manager and employee should meet about
the infraction.
• This type of meeting is called an investigative
interview and is used to make sure the
employee is fully aware of the discipline
issue.
• This also allows the employee the
opportunity to explain his or her side of the
story.
• These types of meetings should always be
conducted in private, never in the presence
of other employees.

20. • If an employee is not meeting the expectations, discipline might need to occur. Discipline is defined
as the process that corrects undesirable behavior. The goal of a discipline process shouldn’t
necessarily be to punish, but to help the employee meet performance expectations.
• Often supervisors choose not to apply discipline procedures because they have not documented past
employee actions or did not want to take the time to handle the situation. When this occurs, the
company lacks consistency among managers, possibility resulting in motivational issues for other
employees and loss of productivity.
Guidelines on
creation of
rules and
organizational
policies:
All rules or procedures
should be in a written
document.
Rules should be related to
safety and productivity of
the organisation.
Rules should be written clearly,
so no ambiguity occurs between
different managers.
Supervisors, managers and
HR should outline rules
clearly in orientation,
training and via other
methods.
Rules should be
revised periodically,
as the organisation’s
needs change.

21. References
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22. References
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