chapter-6 tools pmrs

7/28/2019 Chapter-6 Tools Pmrs

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Chapter-6

TOOLS FOR MEASURING

PERFORMANCE


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Objectives of the Chapter

Tools for Appraising Performance

Traditional Performance Appraisal Methods

Purposes of Traditional PerformanceAppraisals

Modern and Developmental Performance

Appraisal Methods


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There are two prevalent approaches to

Performance Management

Traditional Approach

Modern Approach



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Traditional Performance Appraisal

Methods

It is based on the evaluation of character of an

employee. The system may list some personal

traits such as ability to get along with people,judgments, initiative, leadership etc.


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Purposes of Traditional

Performance Appraisals

Performance appraisal for evaluation using thetraditional approach has served the followingpurposes:

To make promotion, separation, and transferdecisions.

To provide feedback to the employee regardinghow the organization viewed the employees

performance. To conduct evaluations of relative contributions

made by individuals and entire departments inachieving higher level organization goals.


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To develop criteria for evaluating theeffectiveness of selection and placementdecisions, including the relevance of the

information used in the decisions within theorganization.

To make reward decisions, including meritincreases, promotions, and other rewards .


Performance Appraisals contd


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To ascertain and diagnose training anddevelopment decisions.

To develop criteria for evaluating the success

of training and development decisions. To collect information upon work schedulingplans, budgeting and human resourcesplanning.


Performance Appraisals contd


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Traditional Methods

Graphic Rating Scales

Confidential Reports

Straight Ranking Method

Paired Comparison Method

Force Distribution Methods

Grading System

Check List Method Critical Incident Method


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Graphic Rating Scales

Method

The graphic rating scale is the simplest andmost popular method for appraisingemployees performance.

A rating scale lists traits and a range ofperformance values for each trait.

Two types of rating scales

a. Continuous

b. Discontinuous


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Confidential Reports

It differs from department to department.

The report is written for a unit of one year and

relates to the performance, ability andcharacter of the employee during the

particular year.


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Straight Ranking Method

Every employee is judged as a whole without

distinguishing the rates from the employees

performance.

A list is then prepared for ranking the workers

in order of their performance on the job so that

excellent employees will be highly rewarded

and the poor performers will be counseled.


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Paired Comparisons Method

Every employee is compared trait wise and

with other persons, one at a time.

The number of times a person is compared

with others is scored on a paper.

These numbers help in yielding rank order of

employees.


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Forced Distribution Method

The employees are divided into 5 categories

i.e. Outstanding, above average, average,

below average and poor.

The main idea in this system is to spread

rating in the number of grades.


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Grading System

It contain features like analytical ability,

cooperativeness, dependability, job

knowledge, etc. are selected for evaluation.

The grades may be rated as :A-Outstanding;

B-Very Good; C-Satisfactory; D-Average; E-

Below Average, etc.


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Checklist Method

A list of statement that describes the

characteristics and performance of employees

on the job.

Simple Checklist

Weighted Checklist

Forced Choice Checklist


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Critical Incident Method

To measure employees performance in termsof certain events and incidents that occur inthe course of employment.

The assumption in this method is that theperformance of the employee on thehappening of critical incidents determines hisfailure or success.

The supervisor keeps a record of criticalincidents at different times and then rates himon this basis.


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Critical incident method provides an objectivebasis for conducting a thorough discussion ofan employees performance.

The evaluation, under this method, is basedon actual job behavior.

This method also avoids recency bias, asraters record ratings throughout the rating

period. This method can increase the chances that

the subordinates will improve because theylearn precisely what is expected of them.

Advantages of Critical Incident

Method


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Negative incidents are, generally, morenoticeable than the positive ones.

The supervisor may not record an incident

immediately and forget it later on. It may also be very difficult for a supervisor to

decide whether an incident is critical or not.

Very close supervision may result, which may

not be to the liking of the employees.

Disadvantages of Critical Incident

Method


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Free Essay Appraisal Methods

Under free essay method, the supervisor

writes a report about the employee which is

based on his assessment.

The supervisor continuously observes the

subordinates and writes his assessment in the

report.


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Group Appraisals

Employees are rated by an appraisalgroup,consisting of their supervisor, and three orfour other persons who have some knowledge oftheir performance.

The supervisor explains to the group the natureof his subordinates duties.

The group then discusses the standards of

performance for that job, the actual performanceof the employee and the causes of their particularlevel of performance and offers suggestions forfuture improvements, if any.


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Flaws in the Traditional Approach

to Performance Appraisal

The flaws are:

Organizational performance appraisal istypically primarily concerned with the past

rather than being forward looking through theuse of setting objectives or goals.

Performance appraisal is usually tied to theemployees salary review. Dealing with salarygenerally overwhelms and blocks creative,meaningful, or comprehensive considerationof performance goals.


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Modern and Developmental

Performance Appraisal Methods

It is concerned with the use of performance

appraisal as a contributor to employee

motivation, development, and human resource

planning.


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Purpose of Performance Appraisal

To provide employees the opportunity to

formally indicate the direction and level of the

employees ambition.

To show organizational interest in employees

development, which was cited to help the

enterprise retain ambitious, capable employees

instead of losing the employees to competitors.


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To provide a structure for communication

between employees and management to helpclarify expectations of the employee by

management and the employee.

To provide satisfaction and encouragement to

the employee who has been trying to perform well.

Purpose of Performance Appraisalcontd..


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HR Scorecard

It allots the four dimension rating to assess

the progress level of human resources in an

organization.

HR system maturity,

HR competencies of the organization,

HR culture of the organization, and

HR linkage to business goals.


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HR Systems Maturity

The HR systems maturity assesses the extent

to which various HR subsystems and tools are

well designed and are being implemented.

There are seven factors that need to be takeninto account

The system should be appropriate and

relevant to business goals. They should focus on current and future

needs of the corporation.


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HR systems maturity contd.

The HRD strategies and systems should flow

from the corporate strategies.

The systems should be well designed and

should have structural maturity.

They should be implemented well

The subsystem should have internal synergy

They should be adequate and take care of theHRD requirements of the organizations.


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HR Competencies of the

Organization

The competencies include knowledge,

attitudes, values and skills.

The nature of competencies are listed on thebasis of HRD audit.


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HR Culture of the Organization

Openness

Collaboration

Trust and

trustworthiness Authenticity

Proaction

Autonomy

Confrontation

Experimentation

Learning cultureListening


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HR Linkage to Goals

The HRD efforts like tools, processes, culture

are driven to achieve business goals. The goals

are

Profitability, Internal operational efficiencies,

Internal customer satisfaction,

External customer satisfaction,


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Employee motivation and commitment,

Cost-effectiveness and cost-

consciousness among employees, Quality orientation , and

Technology adoption

HR Linkage to Goals contd..


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HR Accounting

Under this method, performance is judged in

terms of cost and contributions of employees.

Cost consists of expenditure on humanresource planning, recruitment, selection,

induction, training, compensation etc.

Contribution consists of money value of labour

productivity.


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Competency Mapping

It involves the determination of the extent to

which the various competencies related to a

job are possessed by the person.


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Assessment and Development

Centers

It can be used as a tool for competence

development.

It is for powerful tool for assessing the

potential of employees.

It is aimed at selecting individuals based on

set criteria and makes use of situational

exercises and simulations.


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360 Degree Performance Appraisal

Systematic collection of performance data on

an individual or group derived from a number

of stake holders on their performance.

-WARD It is also known as multi-source assessment

or multirater feedback.


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Model of 360 Degree Feedback

EMPLOYEEColleagues

Manager

Subordinates

Customers


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Development and Implementation

According to T V Rao, the following steps

should be followed to develop and

implement to define objectives.

To decide on recipients

To decide the giver of feedback

To decide the areas of work and behavior To decide the method of data collection


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To decide the data analysis and presentation

To plan an initial implementationprogram.

To analyze the outcome of the pilot scheme.

To plan and implement full program.

To monitor and evaluate the program.

Development and Implementation

contd


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540 Degree Feedbacks

The range of feedback on the performance of an

employee generated from the stakeholders,

superiors, subordinates, peers, internal andexternal customers, clients or suppliers is

known as 540 degree feedback or appraisal.


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Management by Objectives

It needs the managers to set a specific

measurable goal for each employee and then

periodically discuss the progress towards

these goals.


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Process of MBO

1. Set the organizations goals

2. Set departmental goals

3. Discuss departmental goals

4. Define expected results

5. Performance reviews

6. Provide feedback


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Advantages of MBO

It leads to greater satisfaction, greater

agreement, greater comfort and less tension.

This approach is considerably superior to the

traditional approach of performance appraisal.

It emphasize training and development of

individuals.

It also has a built in device of self-appraisal bythe subordinates.


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Limitationsof MBO

This method can be used only when goal settingis possible by the subordinates.

It involves considerable time, energy andexpenditure.

This approach mainly emphasizes counseling,training and development.

This approach is appropriates for the appraisalof executives and supervisory personnel who

can understand it. Setting objectives with the subordinates

sometimes turns to a tug of war.


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Behaviorally Anchored Rating

Scales

Behaviorally Anchored Rating Scales mingles the

benefit of critical incidents and graphical rating

scale by anchoring a scale with specificbehavioral examples of good or poor

performance.


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Stages of BARS

Create Critical Incidents,

Develop Performance Dimensions,

Renovation of Incidents,

Measure the Incidents,

Develop final mechanism.


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Advantages of BARS

It help to clarify what is meant by extremely

good performance, average performance and

so forth.

It is more useful in providing feedback toappraise than simply informing them of their

performance rating.

The technique is not biased by the experienceand evaluation of the rater.


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Disadvantages of BARS

It is a time consuming and expensive method.

It is more activity oriented than result oriented.

Several appraisal forms are required toaccommodate different types of job in the

organization.


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Summary of the Chapter


Traditional Performance Appraisal Methods

Purposes of Traditional PerformanceAppraisals

Modern and Developmental Performance

Appraisal Methods

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