1. Performance Management
Performance Appraisal is a
systematic description of job relevant
strengths and development needs of
an employee’s actual performance
relative to established standards.

2. Performance Management …
is a process to control
employee work behaviors and
outputs through providing
feedback on performance.

3. Performance Management …
Benefits: An Employee Perspective
Improved Performance requires
Assessment and Feedback
Fairness results when performance is
measured objectively and outcomes are
equitable
Recognition of performance can
motivate employee improvement

4. Performance Management …
 Administrative/Evaluative
pay, promotions, layoffs
 Developmental
training, career development, HR research
 Legal (minimize exposure to EEO)
Job related appraisal
Avoid vague/subjective performance criteria
Implement a review and appeals process
Respect employee privacy and confidentiality

5. Performance Management
 Uses of Performance Appraisal Systems
Rewards
Staffing/Career Decisions
Training/Development Assessment
Motivation
Validate HR Research

6. Performance Management
 Requirements for an Effective
Performance Appraisals
Relevant
Acceptable (Evaluators and Employees)
Practical (Organization and Evaluators)
Reliable
Sensitive to Employee Issues and Needs

8. Performance Management
 Performance Appraisal Criteria
 Traits (focus on the Person)
 Observable personality dimensions
 Reliable, decisive, loyal
 Ambiguous and open to bias
 Behavioral (focus on worker behaviors)
 Behaviors required to accomplish the job
 More legally defensive (than Traits), expensive, time consuming
and limits application across jobs (more job specific)
 Outcomes
 Clear, Unambiguous Criteria
 Eliminates subjective rater error ~ subject to criteria
contamination and deficiency

9. Performance Management
 Comparative Methods
Ranking, Forced Distribution, Essay
 Advantage
Differentiates employees
 Disadvantages
Degree of differences unclear
Difficult to compare across groups
May cause conflict among workers
Vague feedback-difficult to defend

10. Performance Management
 Adjective Descriptor Methods
Behavioral Checklist, Graphic Rating Scale
 Advantages
Avoids conflict
Allows comparison across work groups
Feedback of Specific performance dimensions
 Disadvantages
Open to Rater Error
Inconsistency Across Raters

11. Sample Trait Scales Using
Absolute Standards
Rate each worker using the scales below.
Decisiveness:
1 2 3 4 5 6 7
Very low Moderate Very high
Reliability:
1 2 3 4 5 6 7
Very low Moderate Very high
Energy:
1 2 3 4 5 6 7
Very low Moderate Very high
Loyalty:
1 2 3 4 5 6 7
Very low Moderate Very high
Fig. 7-4 © 1998 by Prentice Hall

13. Performance Management
 Expected Outcome Methods
Management by Objectives, Behavioral
Anchored Rating Scales (BARS)
 BARS measures actual performance
behaviors exhibited by an employee
relative to pre-defined behaviors of a
critical performance dimension.
 MBO is a mutual goal setting process
comparing actual performance to agreed
upon performance objectives.

15. Performance Management
 Effective Performance Evaluators should be
Knowledgeable of job requirements
Able to observe performance
Accurate, unbiased, able to differentiate
performance levels

16. Performance Management
Sources of Evaluators
Peers
Self appraisals (Employee)
Subordinates
Outside personnel
Computer monitoring
§The 360 degree method
§Choice Depends on Objectives

17. Performance Management
 Evaluator Error (Bias)
Halo/horn
Harshness/strictness
Leniency
Central Tendency
Recency
Contrast- similar or dissimilar to me
Anchoring- biased by prior appraisal

18. Performance Management
 Scheduling (Timing) of Performance Appraisal
 Intermittent v. Continuous (Formal v. Informal)
 Purpose: Developmental v. Pay Adjustment
 Intermittent v. Continuous
 Formal ~ usually intermittent (monthly, semi-annual,
annual)
 Informal ~ should be continuous (daily if necessary)
 Communicate when required – support positive results or
correct developmental (deficient) performance areas
 Development v. Pay (Two separate Appraisal Interviews)
 First discuss performance strengths and developmental
needs
 Second discuss pay issues

19. Performance Management
 Improving Performance Appraisal Process
 Give daily not once a year
 Have employee’s rate their performance
 Encourage the employee to participate
 Emphasize Constructive criticism
 Provide constant Feedback
 Focus on behavior (performance) not the person
 Mutually agree on specific goals, timelines, and
developmental programs/assignments