Vous êtes sur la page 1sur 27


7-8. Performance
Professor Debi S. Saini

Issues discussed in this Presentation are:

1.PM: general Perspectives & salience of PM

2.PA: Concept, Nature, Objectives
3.PA: Problems & How to Avoid them
4. Approaches to, & methods of PA

5.Caution on Performance Mgt.


Ms. Prachee Jain had a call from a customer
about a defective part on a product
that the co. sells but does not make (photo copier).

She kept her cool

despite severe verbal anger by the customer
She was able to identify the source of the defect,
called the manufacturer, and

resolved the issue within 15 minutes.


How will you to assess her Performance,

using Different Methods

1. Graphic rating scale:

2. Behaviour rating scale

3. Critical incidents method



General Perspectives
and Concept of
Performance Management

Performance: General Perspective

Shift: contract of employment to contract for performance
It is no good having all the right people all in the right place, but not delivering the goods. T. & Hall)

New catchwords: PM, engagement, job enlargement, EI

PM: An integrated, flexible approach to manage & reward

Focuses: individuals/teams/organization

Focus: Efficiency to effectiveness to feeling of achievement



Why is Performance so Critical?

Challenges of Globalization: Customer-centricity

Be innovative while performing

Ensure full potential of Human Capital

Attack complacency???

What is Performance Mgt.?

1. Set objectives; plan performance

2. Performance execution through support

3. Assess & measure performance

4. Performance review: Feedback & amend goals/activities



Fatures of Performance Mgt.

PM: A developmental process; almost whole HRM

Range of PM: Informal chat to elaborate procedures (e.g. TQM)

PM is a tool to improve orgl./indiv. performance:

Primary structural change (what org. be doing differently)

Primary behavioural change, and

Action plans for commitment

Execution of plans 9

Features of Performance Mgt. contd

PM is a new mgt. philosophy

A new role for managers

From controllers, and implementers
to leaders, developers, entrepreneurs

It needs: Leadership/team spirit/engagement



Performance Appraisal & Performance Mgt

Performance Appraisal Performance Management
1. Focus: Evaluate looking back 1. Focus: Future planning & review

2. A narrow term 2. A broader term

3. Deals with: indiv. performance 3. Deals with: indiv./team/orgl. Perform.

4. A part of Traditional PM 4. An aspect of Strategic HRM

5. Substantial role for HR mgrs. 5. Role: line/HR mgrs., teams, indiv.

6. Orientation: integrated/HRD
6. Orientation: control

7. PM Design: HR/line mgrs.

7. PA design: Involvement of HR

8. Review: annual or periodic 8. Continuous review/dev & LO


Nature and Objectives

Performance Appraisal



Performance Appraisal (PA): General

Employees want to know:

What is expected of them; How will it be measured?

What traits/behaviours/achievements are important?

Will PA be fair & equitableWill it lead to reward?


Performance Appraisal (PA): General contd

PA has many facets:
Involves observation/judgement
A feedback by manager
A measurement process
Emotional processInexact human process
PA perceived effective only in 10% orgs.: Still done

Key Q.: how to make it objective 14


What is Performance Appraisal (PA)

PA is a process through which

an employees job performance for a time period

is assessed & reviewed systematically

qualitatively &/or quantitatively

for taking various HR decisions


Features of PA
1. Involves reviewing job performance/behaviour

2. Designed by HR deptt. or in consultation with line

3. Generally done by mgr. annually or 6 monthly
4. Aims: HRD/ reward/Judging HR systems/Promotion

5. PA done for all categories of employees

Traditionally: done for mgrs. & supervisory staff
Later on: Secretarial & clerical staff included
Lately: Even workmen also included


Performance Appraisal:
Problems and
How to Avoid Them


Inherent Conflicts in PA






Problems in PA
I. Problems related to subjectivity & biases

1. Halo (Tendency to rate high on overall impression)

2. Horn effect (basing on 1 negative aspect)

3. Stereotyping (mental picture on basis of age, gender, etc.)

4. Personal prejudice

Problems in PA: Subjectivity & biases

5. Contrast error (Relating to other people than to performance)

6. Similarity error (Rater seeing own traits in ratee)

7. Central tendency

8. Leniency & strictness bias

9. Recency effect/Spillover effect (past-performance bias)



Problems in PA contd.

II. Other Problems

1. Lack of clarity: Most PAs evaluate perform. or potential

2. Raters incompetence or low rater-motivation

3. PA systems assume: people work independently

But we depend on others to accomplish our jobs

4. Info. often kept secret from employee: Need for PA interviews

5. Often we judge personality than performance 21

How to Avoid Appraisal Problems

1. Understanding both the problem & the context
2. Choosing the right appraisal tool
Use measures of traits & behaviour
Using multiple raters: peer review 360 degree

3. Train supervisors to avoid rating errors

Raters shown a video tape of jobs being done; asked to rate
Ratings then placed on flipchart
Rater then gives correct rating, & illustrates errors
Errors such as leniency, halo explained along with reasons


How to Avoid Appraisal Problems contd

4. Rate selectively: rate only in knowledge areas

5. Reduce outside factors

e.g. Union pressure

6. Diary Keeping: (Write down positive & negative critical incidents)


How to Avoid Appraisal Problems contd

7. Need for excellent interviewing & coaching skills

8. HR to help line to devise simple & workable PA system

9. Help people develop themselves:

Imp. of self-appraisal

10. Regular feedback from line & even customers



What Do Researches Reveal about PA?

1. Results are taken into a/c in PA, not input/efforts

Lack of soft measures to bring behaviour change

2. WM have a deep desire for PA system to be equitable

3. In PA individuals value:
i) Participation ii) Opportunity to put ones own case

4. Multiple appraisers puts pressure on others to be fairer


Approaches to
Performance Appraisal



Approaches to PA
1.Confidential Report

2. Self Appraisal

3. Three-sixty degree PA

4. Peer Review

5. Open Appraisal & Performance Interview


Performance Appraisal



Methods of Performance Appraisal

Traditional Methods
1. Ranking Method
A. Simple or Straight Ranking
B. Paired Comparison Method
C. Forced Distribution Method

2. Narrative or Descriptive Method

A. Free Report or Essay
B. Critical Incidents
C. Field Review Method

3. Graphic Rating Scales

4. Checklist Method 29

Methods of PA contd
II. Modern Methods

5. Behaviourally-Anchored
Rating Scales (BARS)

6. Management by Objectives (MBO)



1A. Simple Ranking Method

Rater assigns relative ranks to employees in a unit
Employees involved are doing the same job

Overall ranking from best to poorest

Whole man is compared with whole man, not performance

Relative position of employees reflected in ranks


1B. Paired Comparison Method

A modified version of ranking

Each person is compared with all others in pairs
Comparison tells which of the ratees is superior
The no. of times a person is ranked better tells his rank
Employee with highest no. of positive signs gets rank 1

Formula for no. of comparisons is:

Employee with a minus sign means
That he is worse than the other person in the pair 32


1C. Forced Distribution Method

Rater to distribute ratings into normal bell-shaped curve

Aim is to eliminate raters bias of central tendency

Ranking technique is used here differently

Ratees required to be allocated to some %age:
Superior, above ave., average, below average, inferior

PR design & format involves 2 major tasks:

Number of categories
Percentage of people to be allocated to each category

PA method where ratings are distributed along a

bell-shaped curve



2A. Free Report or Essay

Rater writes an essay on ratees performance
Essay written on basis of overall performance

Information: Factual & concrete

Ratee described in broad categories e.g.

Strengths & weaknesses
Major achievements & failures
Potential; training & development needs
Overall performance
Suggestions for improvement

2B. Critical Incidents Method

Involves brief anecdotal reports by supervisors

Recording major critical incidents e.g.

behaviour in emergencyin go-slow--in power failure

Stress on effective & ineffective things done

Focus on behaviour, not traits or performance



2C. Field Review Method

Interviewing of supervisors by HR man or Outsider

Various Qs about emp.s performance: Qs. prepared in advance

Qs: e.g. Performance levelWork progressPromotion potential, etc

Evaluator takes detailed notes of ans., compiles them

Supervisor reviews notes; changes madeAns put in emp.s file


Skills/Abilities Behaviors Results

Job Knowledge Perform Tasks Sales
Loyalty Obeys Instructions Production Levels
Coordination Reports Problems Production Quality
Business Knowledge Maintains Equipment Scrap/Waste

Desire to Achieve Follows Rules Accidents

Dependability Submit Suggestions Equipment Repairs
Creativity Follow-up Customers Served
Leadership Writes Reports Customer Satisfaction

Honesty Completes Reviews Feedback



3. Rating Scales (RS)

Also called Graphic RS/Linear RS/Adjective RS: Oldest

Criteria/factors identified: e.g. HonestyPunctuality, etc

Numerical scale ranges from Excellent to Poor

Typically 5 to 10 point are used on the continuum

Rater is given a printed form for each employee

Checks performance level on each factorthen total numerical score

Types of Graphing Rating Scales

Two types of graphic rating scales in use today

1. Most common type: Lists factors in job performance

Quality (factor) of work; quantity (level)

2. Behavioural: Specific behaviours listed

Effectiveness of behaviour of each tested



Table: Rating Scales Illustration

Employee Name ____________________ Deptt. _______________
Perform. Factor Excellent** Good Acceptable Fair Poor
5 4 3 2 1
1. Dependability* _____ ____ _____ ____ _____
2. Initiative _____ ____ _____ ____ _____
3. Attitude _____ ____ _____ ____ _____
4. Cooperation _____ ____ _____ ____ _____
5. Work Quality

20. Attendance _____ ____ _____ _____ _____

* Often performance factors are elaborated in the form itself e. g.
1. Dependability : is following directions & company policies without supervision
2. Work Quality: is accuracy skill & completeness of work

** Also, in place of excellent, good, poor, etc. performance rating may be defined as
consistently unsatisfactory; occasionally unsatisfactory; consistently satisfactory;
sometimes superior, etc. 41

4. Checklist
List of statements or words; rater checks applicable statement

Typical checklist statements are: Yes No

Can be expected to finish work on time
Often agrees to work overtime
Is cooperative & helpful
Accepts criticism

Checklist can be modified: weights are assigned to statements

The results can then be quantified; weights often not known to the rating supervisors

An analyst in HR scores checklist; often weighing factors

Performance of a WM rated on the basis of positive checks


5. Behaviourally-Anchored Rating Scales

Aims to test employee behaviour than other features

It is a variation of RS: Job dimension rated in behaviours

Use critical incidents to describe various Perform. Levels

Presumes: Using specific job behav.: leads to error-free PA


Behaviourally-Anchored Rating Scales contd

Firstly, relevant job-related dimensions identified

e.g. human relations skills; risk-taking; professionalism

Wide variety of behavioural examples are considered

The examples identified & evaluated by a sample Gr. of raters
A scale-point (7 or 9 ) to each example selected is allocated (Fig.)
Behaviour expected at each point identified i.e. good, poor

For clarity only 1 behavl. example given at each point

But in fully-developed scale, can be several behaviours at each point

Thus WMs actual job behaviour judged against desired



Table: BARS for Deputy Sec.HR Skills

Performance Category: Human Relations Skills

Excellent 7 Can be expected to maintain and facilitate harmonious relationship with

the most disagreeable professors/students/staff even in adverse situation

Good 6 Can be expected to command high respect by nearly all professors,

students, staff, most of whom consider the employees to be a warm cooperative person

Above Ave. 5 Can be expected to maintain composure in difficult situations and is

polite to those entering the Department Office

Average 4 Can be expected to treat the majority of persons with courtesy and
resolve minor conflicts that occasionally arise between staff members

Below Ave 3 Can be expected to exhibit somewhat superficial politeness with a

tendency toward curtness when under stress

Poor 2 Can be expected to exhibit frequent unprovoked rudeness that

occasionally but significantly impairs job performance

Extreme poor 1 Can be expected not to get along well with others and is a significant
source of low employee morale and poor relations with other departments 45

Still Another Behavioural Rating Scale

Behaviorally Anchored Rating Scales (BARS):

The customer service representative

1 2 3 4 5

Argued with Offered positive Used positive

customer information phrases to
about product when asked describe
suitability directly product


6. Management by Objectives (MBO)

Precise, measurable org. wide goal-setting; includes:
Profits, sales, wastage level, complaints, quality of product

Org. objectives translated into depttl. goals:

Deptt. heads & superiors involved in depttl. goal-setting
Targets passed to departments, division, individuals
Depttl. head discusses depttl. goals with subordinates

Subordinate involved in setting/reviewing targets

Indivs. asked to set own goals; discussed; joint target-setting
Targets periodically reviewed/revised to keep flexible/update

Management by Objectives

Source: Robbins, 2003


Management by Objectives

Source: Schermerhorn, 2003

Caution in
Performance Mgt. System



Performance Problems
Research: huge performance gap between high
and low performers in any organization

between 30%-50% for unskilled jobs

& up to 100% for highly technical ones

From : Why people do not get fired: the psychology of discipline avoidance 51
- http://www.workrelationships.com/site/articles/performance_management.htm

How to Destroy PM System

Do not follow policies
Be inconsistent in application
Treat it as unimportant

Do not follow-up
Reprimand in public; Reward in private

Conduct when angry

Be late


What Can one Learn from this Session?

Performance Mgt is a broader term than PA

Many alternative approaches & methods of PA

Managers need to guard against typical problems in PA

To ensure performance, mgrs must devise effective PA system

Approaches to PA and its methods must not be mixed

There is tendency to move to more modern PA methods