Module 1: Unit 1.3

EFFECTIVE PERFORMANCE APPRAISAL SYSTEM

• A performance appraisal system is the overarching framework that guides performance management in the organization.

• 
  It is a system that is put into place to provide direction and structure to performance management activities and is different from the appraisal process which only focuses on the act of appraising

STEPS FOLLOWED IN EFFECTIVE PERFORMANCE APPRAISAL SYSTEM

DESIGN INPUT:
TRAINING THE APPRAISER
FORMAL AND INFORMAL
APPRAISAL SYSTEM EVALUATION

DESIGNING INPUT

Previously, it relied on HR department input, which changed to welcome and embrace employee involvement also HR does not dominate the entire process

  Steps for involving employees in the PA design or redesign project:

Step 1:Group formation
Step 2:Objectives and concerns
Step 3:Dimensions of performance
Step 4: Policies and procedures

Step 1:Group formation

o A cross-functional team should be assembled (This ensures that the system is not developed in isolation but includes perspectives from those who will use and be affected by it,)

o The charge to this team from management should be clear.(basically the instructions of their project)

Step 2:Objectives and concerns

o Team members should discuss their own goals and the problems they would like the new PA system to overcome.

o Employee surveys, customer inputs and inputs from other sources should be considered at this step.

o The team should generate a list of desired benefits of PA, as well as concerns .

Step 3: Dimensions of performance

o identify the dimensions of performance that need to be evaluated.

o Dimension of performance must be directly observable, behavioural and job-related

o Dimensions of performance evaluated could be Work output and quality or Attendance records,

Step 4: Policies and procedures

o   The team should prepare guidelines for implementing the new PA system that supports the objectives established in Step 2.

o   Review and evaluation of the new PA system should also be addressed.

Total quality management or systems approach

TQM adopts a systems approach where improving processes, structures, and organisational conditions is the primary route to better quality and performance,

Recommendations for integrating PA with TQM:

o   Train raters in recognising both system and person factors.
o   Collect ratings from multiple perspectives and raters.
o   Minimise differentiation between employees.

Training appraisers : Modern approaches

Modern approaches emphasise formal, structured training for appraisers, focusing on system knowledge, legal awareness, and refined evaluative skills, rather than relying on assumed natural ability alone.

Training appraisers :Topics normally included in appraisal training are :

• The purposes of performance appraisal.

• How to avoid problems - halos , bias , central tendency and so on.

• How to conduct non-discriminatory appraisals.

• How to conduct effective appraisal interviews

Training appraisers : Impression management

Impression management refers to the deliberate actions by employees to disguise their shortcomings and exaggerate or dramatise their strengths in order to create a more favourable performance appraisal rating than their actual performance warrants.

the two general strategies employees use in impression management

Demotion-preventive strategies

Promotion-enhancing strategies

Demotion-preventive strategies

employees seek to minimise responsibility for some negative event or are used to get out of trouble. They include:

1 Giving accounts or excuses ('I couldn’t finalise the work , I was ill').

2 Apologies.

3 Dissociation ('I was the only person on the team who anticipated the prob lem').

Promotion-enhancing strategies

employees seek to gain credit or enhance the employee's viability. They include:

1 Entitlements ('Perhaps you remember my last suggest ion? It's already saved us money!').

2 Enhancements ('No t only is my suggest ion saving money, but mora le has improved as well').

3 Obstacle disclosure ('I had to overcome reluctant co -workers and red tape to succeed' ).

FORMAL AND INFORMAL METHODS : Formal methods

Conducted annually or bi-annually, usually when HR notifies supervisors that an appraisal is due.

Often treated as a mandatory administrative task rather than a developmental process.

Mainly used to facilitate decision-making about pay increases.

Neglects performance feedback for developmental purposes.

FORMAL AND INFORMAL METHODS : Informal Methods

• An ongoing process rather than a once-off event.

• Enables regular exchange of feedback between supervisors and employees.

• Emphasises that performance feedback is a continuous supervisory responsibility

• Ensures good work does not go unnoticed.

FORMAL AND INFORMAL METHODS EXMAPLES

ADOBE-Check-in’s

DELOITTE-Frequent Check-in’s and coaching and mentoring

GENERAL ELECTRIC-frequent feedback systems- app to record progress and facilitates feedback

ACCENTURE-frequent feedback systems

CARGILL-everyday performance management

APPRAISAL SYSTEM EVALUATIONS

INTERVIEWS
ANALYSIS OF EMPLOYEE RECORDS
ANALYSIS OF RELATIONSHIP BETWEEN THE EMPLOYEES AND THEIR RATINGS
ANALYSIS OF PA SYSTEMS IN COMPARABLE SETTINGS

APPRAISAL SYSTEM EVALUATIONS:INTERVIEWS

o   Managers from various departments were interviewed. Discussions focused on the strengths and weaknesses of the present system and on recommendations for improving the system.

APPRAISAL SYSTEM EVALUATIONS: ANALYSIS OF EMPLOYEE’S RECORDS

o   Examine to spot rater errors such as central tendency, leniency and the halo effect

APPRAISAL SYSTEM EVALUATIONS: ANALYSIS OF RELATIONSHIP BETWEEN THE EMPLOYEES AND THEIR RATINGS

o   Employee ratings were correlated with certain personal and work factors (such as age, tenure and race).

Employees were asked whether appraisal results were discussed with them.

APPRAISAL SYSTEM EVALUATIONS:ANALYSIS OF PA SYSTEMS IN COMPARABLE SETTINGS

o   compare to the systems used by 39 similar organisations

This allows the company to see how its practices align with industry standards and if there are more effective methods being employed elsewhere

THE APPRAISAL INTERVIEW

It is a formal discussion between the supervisor and the employee that takes place as one of the final and most important steps in the performance appraisal (PA) process.

THE APPRAISAL INTERVIEW: THE PURPOSE OF AN APPRAISAL INTERVIEW

• The purpose of the interview is to discuss the employee’s performance appraisal results.

• It provides performance-related feedback, which is regarded as one of the most important methods for enhancing employee development and improving individual performance.

During the appraisal interview, employees Learn where they stand in the eyes of the organisation.

THE APPRAISAL INTERVIEW: There are three types of information that supervisor raters generally try to relay in PA interviews:

▪  Performance improvement feedback
▪  Corporate goal feedback
▪  Salary/employee advancement information

Problems with the appraisal interview: Situational variables that contribute to supervisors’ failure to rate subordinates including the solutions

1. Have worked only for short period of time for the supervisor=Use multiple sources of information (e.g. previous supervisors’ records, peer input, work samples).

2. Subordinate had little job experience= Focus the appraisal on learning progress and skill development, not only outcomes.

3. Little trust between the supervisor and subordinate= Base ratings strictly on objective, job-related criteria.

4. Little structure from the supervisor= Provide standardised appraisal forms and clear guidelines.

Problems with the appraisal interview: Psychological variables that contribute to supervisors failure to rate subordinates:

1. Playing god (Supervisors abuse their power, act subjectively, or treat appraisals as a personal judgement rather than an objective process.)= Shift the appraisal focus from control to coaching and development.

2. Inability to give constructive criticism (Supervisors avoid difficult conversations because they fear conflict, damaging relationships, or lowering employee morale.)= Training in constructive feedback techniques

3. Personality biases (Personal likes, dislikes, stereotypes, or emotional reactions influence ratings (halo effect, horn effect, leniency, severity, central tendency).= Use behaviourally anchored rating scales (BARS) to anchor ratings to observable behaviour.

4. Inability to give effective feedback (Feedback is vague, delayed, overly general, or delivered only once a year.)= Train supervisors in effective communication and feedback techniques

STEPS IN THE APPRAISAL INTERVIEW

STEP 1: PREPARE THE INTERVIEW
STEP 2: STATE THE PURPOSE OF THE INTERVIEW
STEP 3: INDICATE SPECIFIC AREAS OF GOOD PERFORMANCE AND AREAS THAT NEED PERFORMANCE IMPROVEMENT
STEP 4: INVITE PARTICIPATION
STEP 5: FOCUS ON DEVELOPMENT

STEPS IN THE APPRAISAL INTERVIEW (STEP 1: PREPARE THE INTERVIEW)

• During preparation, the supervisor (or other rater) should gather and review all relevant performance records (these include all data regarding work output and quality, absenteeism and tardiness etc.)

• The supervisor must be able to support the appraisal with facts.

• Preparation includes setting a date for the appraisal interview that gives the employee lead time to prepare

STEPS IN THE APPRAISAL INTERVIEW (STEP 2: STATE THE PURPOSE OF THE INTERVIEW)

• The employee should be told if the interview will cover compensation and staffing decisions, employee development or both.

• Some managers avoid mixing compensation and staffing decisions with employee development issues in the same appraisal interview

STEPS IN THE APPRAISAL INTERVIEW (STEP 3: INDICATE SPECIFIC AREAS OF GOOD PERFORMANCE AND AREAS THAT NEED PERFORMANCE IMPROVEMENT)

• Supervisors generally begin the discussion by highlighting areas of good performance.

• Appreciation and recognition for good work are important parts of the appraisal interview.

• Areas of performance in need of improvement are discussed next

• supervisors must be as specific as possible about performance needing improvement and avoid straying to personality issue

STEPS IN THE APPRAISAL INTERVIEW (STEP 4: INVITE PARTICIPATION)

• Throughout the appraisal interview, the employee should be invited to comment

• It is also an opportune time to clear up any misunderstandings that may still exist about job expectation

• If supervisors have done a good job of communicating job goals, objectives and standards, employees should not receive any surprises during the interview.

STEPS IN THE APPRAISAL INTERVIEW (STEP 5: FOCUS ON DEVELOPMENT)

The next step involves setting up the employee's development programme.

Employees are much more likely to be committed to developmentaL programmes if they agree with the supervisor that the programme is necessary to improve job skills and abilities.

INTERVIEWING TECHNIQUES:

• TELL and SELL,

• TELL AND LISTEN

• PROBLEM SOLVING:

INTERVIEWING TECHNIQUES: TELL AND SELL

1. This technique is a top-down approach where the rater acts as a judge.

2. The objective is to persuade the employee to change their behaviour and communicate the evaluation clearly.

3. The psychological assumption is that the superior is uniquely qualified to evaluate the subordinate and that the employee will naturally want to correct a weakness once it is pointed out.

4. The employees reaction often leads to suppressed defensive behaviour.

INTERVIEWING TECHNIQUES: TELL AND LISTEN

In this method, the rater still occupies the role of a judge but incorporates active listening and reflection.

The objective is that the rater shares both positive and negative aspects of performance, then allows the employee to respond. The goal is to release defensive feelings.

Psychological Assumptions are based on the belief that people will be more open to change if their defensive feelings are removed through understanding.

The Employee Reaction is that the employee is encouraged to express defensive behaviour and, in doing so, feels accepted.

INTERVIEWING TECHNIQUES: PROBLEM SOLVING

1. This is the most collaborative approach, where the rater shifts from being a judge to a helper.

2. The objective is to stimulate growth and development by exploring new ideas and mutual interests.

3. •The Psychological Assumptions is that it assumes that growth can occur by correcting faults and that discussing job-related problems directly leads to improvement.

4. The employee reaction is that they engages in problem-solving behaviour, taking on increased freedom and responsibility.