The document discusses performance appraisal, including various methods of appraising employee performance such as work standards approach, critical incident appraisal, checklist, essay appraisal, graphic rating scale, behaviorally anchored rating scale, ranking methods, and forced-choice rating. It also covers goal setting or management by objectives, sources of performance information, common errors in performance appraisal like halo error and leniency error, and ways to overcome errors such as using multiple criteria and evaluators.

1. PERFORMANCE APPRAISAL

2. • METHODS OF APPRAISAL
• GOAL SETTING OR MBO
• SOURCES OF PERFORMANCE INFORMATION
• ERRORS IN PERFORMANCE APPRAISAL
• OVERCOMING ERRORS IN PERFORMANCE APPRAISAL
Topics to be
discussed

3. M E T H O D S O F A P P R A I S A L
Various methods of appraising employee performance consist of the
following:
• Work standards approach
• Critical-incident appraisal
• Checklist
• Essay appraisal
• Graphic rating scale
• Behaviorally anchored rating scale
• Ranking methods
• Forced-choice rating

4. WORK STANDARDS APPROACH
• Involves setting a standard level of output and then comparing
every employee’s performance with the standard
• Work standards generally represent the average output of the
average employee
using highly objective factors in evaluating performance.
difficulty of comparing standards for the different categories of
jobs.

5. CRITICAL-INCIDENT APPRAISAL
• The critical incident is recorded by an observer, indicating the
employee’s reaction towards a certain event.
• When recorded, the incidents are, later, used as basis for evaluating
the performance of the employee.
(1) recording the incidents covering all employees whether on a daily
basis is time-consuming;
(2) there is much difficulty in quantifying critical incidents.

6. • list of behavioral descriptions is used by the evaluator in the checklist appraisal.
• The items are presented in questions answerable by either “yes” or “no”
Simple and easy to administer
• evaluator may be affected by his own personal biases in the use of the checklist
• this method is very costly if there are many job categories
CHECKLIST

7. SAMPLE CHECKLIST ITEMS

8. ESSAY APPRAISAL
• Also known as free-form appraisal
• A method where the appraiser writes a narrative about the
person being appraised.
Simple and it requires no complex training for the appraiser
• writing abilities of the appraisers differ
• the narratives often vary in length and content, making it difficult
to compare one person with another
• narratives are difficult to quantify

9. GRAPHIC RATING SCALE
• Uses a set of identified performance factors.
Provides opportunities for quantitative analysis and which facilitates
comparisons of performance between various job categories.
• It does not provide the depth of information other methods do.

10. EXAMPLE OF A GRAPHIC RATING SCALE

11. BEHAVIORALLY ANCHORED RATING SCALE
• Behavioral anchors are used to assess the performance of an
employee.
• A separate scale for each job dimension is developed.
• Consists of scale values, which define specific categories of
performance and anchors, which are specific written
statements of actual behavior.

12. EXAMPLE OF BEHAVIORALLY
ANCHORED RATING SCALE

13. RANKING METHODS
• Calls for comparing the performance of two or more
employees.
The more popular ranking methods consist of:
• Alternation,
• Paired comparisons, and
• Forced distribution

14. ALTERNATION
• From a list of employees to be evaluated, the evaluator prepares
another list where the individual names are entered and arranged
according their value or importance.

15. PAIRED COMPARISON
• Under this method the name of an employee is paired with another
and the evaluator determines who is better employee.
Example of paired
comparison results

16. A sample summary
of comparisons

17. FORCED-CHOICE RATING
Under this method the evaluator also compares the performance of
employees. The evaluator allocates the results to the percentage
requirements of the various pre-determined levels of performance.

18. GOAL SETTING OR MBO
• Sometimes referred to as management by objectives (MBO)
• Facilitate a more elaborate means of performance evaluation
The employee and his superior jointly set goals
The employee tries to meet the goals
 Performance is evaluated against the goals
The employee and superior jointly set new goals for the next time
period.

19. For an MBO system to be successful, there are certain
prerequisites that must be satisfied accordingly which are as
follows:
• The use of participative style of management
• Pinpointing which employee is responsible for which results; and
• Providing performance feedback to concerned employees

20. SOURCES OF INFORMATION
• Supervisors
• Peers
• Subordinates
• Self
• Customers

21. ERRORS IN PERFORMANCE APPRAISAL
It is when the result of evaluation of one trait influences the
evaluator in the assessment of the other traits.
To avoid this error, the evaluator must be diligent enough to use the
standard procedure in all traits under consideration.

22. • An error in appraisal may happen when a job consisting of
several tasks is evaluated on the basis of a single criterion.
• Evaluators are confronted with the tendency to use his or her
own value system in appraising the performance of certain
individuals.
• The leniency of the evaluator may lead to a very high or very
low ratings when applied to a group of employees.

23. Is committed when all employees are rated within a narrow range as if the
performances of all employees are equal or almost equal.

24. • Occurs when recent performance is given grater weight than earlier
performance
• The opposite of recency problem is the primary error, where early
performance is considered more important than later performance

25. OVERCOMING ERRORS IN PERFORMANCE
APPRAISAL
• Using multiple criteria
• Emphasizing behaviors rather than traits
• Documenting performance behaviors
• Using multiple evaluators
• Evaluating selectively
• Training evaluators

26. o The various methods of appraising performance consist of work standards
approach, critical incident appraisal, checklist, essay appraisal, graphic
rating scale, behaviorally anchored rating scale, ranking methods, forced-
choice rating, and goal setting or management by objectives.
o Information about employee performance may be sourced through
supervisors, peers, subordinates, self, and customers.

27. o Appraisal error consist of halo error, single criterion, leniency error, central
tendency error, and recency problem.
o Errors in performance appraisal may be overcome with the application of
the following: using multiple criteria, emphasizing behavior rather than
traits, documenting performance behaviors, using multiple evaluators,
evaluating selectively, and training evaluators.

28. QUESTIONS:
• What do you think is the commonly
committed error in performing
performance appraisal in an
organization?
• Discuss the advantage of using multiple
raters against single raters.