Industrial and Organizational PsychologyPerformance Appraisal

Copyright Paul E. Spector, All rights reserved, March 15, 2005

What Does It Mean To Do a Job?

• Criterion: Standard of judging; a rule or test by which anything is tried in forming a correct judgment respective it.

• Single Criterion: Global measure to represent performance

• Composite criterion: Combination of individual subcriteria– Requires common metric– Brogden & Taylor (1950) Dollar Criterion– Convert each subcriterion to money– Requires quantification of subcriteria

• Multidimensional– Each person gets multiple scores that aren’t combined 

Characteristics of Criteria

• Theoretical criterion: Conceptual definition of performance

• Actual criterion: How performance is assessed

• Relevance: Actual assesses the theoretical

• Contamination: Actual measures something other than the theoretical

• Deficiency: Actual fails to capture the theoretical

Performance Appraisal

• Determination and Documentation of Individual's Performance

• Should be tied directly to criteria

• USES– Administrative decisions (promotion, firing, transfer)

– Employee development and feedback

– Criteria for research (e.g., validation of tests)

– Documentation for legal action

– Training

Objective Methods• Counts of behaviors or outcomes of behaviors

• Advantages • Consistent standards within jobs • Not biased by judgment • Easily quantified• Face validity‑bottom line oriented

• Disadvantages• Not always applicable (teacher)• Performance not always under individual's control• Too simplistic• Performance unreliable--Dynamic• Criterion

Subjective Methods

• People’s judgments about performance

• Trait based graphic rating scale

• Behavior based: Critical incidents

• Mixed Standard Scale

• Behaviorally Anchored Rating Scale

• Behavior Observation Scales

• Problems:

• Rating errors: Leniency, Severity, Halo

• Supervisor subversion of system--leniency as a strategy

• Mixed purposes (feedback vs. administrative)

• Negative impact of criticism

Rater Error Solutions

• Error resistant rating forms – Behaviorally Anchored Rating Scale, BARS

– Behavior Observation Scale, BOS

– Mixed Standard Scale, MSS

– Research does not show these forms to be successful in eliminating errors

• Rater training– Rater error training: instructs raters in how to avoid errors

• Reduces halo and leniency error

• Less accuracy in some studies

– Frame of reference training: Give raters examples of performance and correct ratings

• Initial research promising in reducing errors (Day & Sulsky, 1995)

Sound Performance Appraisal Practices

• Separate purposes– Raises dealt with separately from feedback

• Consistent feedback, everyday

• Limit criticism to one item at a time

• Praise should be contingent

• Supervisors should be coaches

• Appraisal should be criterion related, not personal

Technology• Technology helpful for performance appraisal•  Employee performance management systems

– Web-based– Automated—reminds raters when to rate– Reduces paperwork– Provides feedback

•  360-degree feedback systems– Ratings provided by different people

• Peers• Subordinates• Supervisors• Self

– Big clerical task in large organizations to track/process ratings– Web makes 360s easy and feasible– Consulting firms available to conduct 360s

Legally Defensible Performance Appraisal

• Performance appraisals can be legally challenged– Organizations lost 41% of cases—Werner & Bolino 1997

• Practices that minimize legal challenges – Job analysis to define dimensions of performance

– Develop rating form to assess dimensions from prior point

– Have written instructions

– Train raters in how to assess performance

– Use multiple raters

– Management review ratings and allow employee appeal

– Document performance and maintain detailed records

– Provide assistance and counseling