Chapter 9: Performance Management and Appraisal

Performance Management

An ongoing process of identifying, measuring, and developing employee performance to align with organizational goals.

Performance Appraisal

A short-term method for measuring productivity and evaluating employee performance.

SMART Goals

Specific, Measurable, Achievable, Relevant, and Time-bound objectives set to guide employee performance.

360-Degree Feedback

A performance evaluation method that gathers input from multiple sources, including supervisors, peers, and subordinates.

Graphic Rating Scale

A method that rates traits or behaviors on a scale, providing a simple but potentially vague assessment.

Behaviorally Anchored Rating Scale (BARS)

A performance appraisal method that combines traits with specific examples to provide a clearer evaluation.

Management by Objectives (MBO)

A performance management approach where employees and managers collaboratively set measurable goals.

Central Tendency Bias

A common error in performance appraisal where all employees are rated as average, avoiding extremes.

Halo Effect

A cognitive bias where one positive trait overshadows other qualities in an employee's evaluation.

Recency Bias

The tendency to focus on recent events when evaluating an employee's overall performance.

Peer Appraisal

A method where colleagues assess each other's work, providing insights into day-to-day operations.

Self-Rating

A process where employees evaluate their own performance, highlighting achievements and areas for improvement.

Upward Feedback

A performance evaluation method where subordinates assess their managers, offering insights into leadership effectiveness.

Feedback and Coaching

The process of providing constructive criticism and guidance to employees to improve performance.

Performance Management Cycle

A structured approach involving planning, monitoring, reviewing, and rewarding employee performance.

Common Errors in Appraisal

Mistakes such as personal bias, leniency, strictness, and focusing on recent performance that can distort evaluations.

Training Needs Identification

The process of determining the skills and knowledge gaps that need to be addressed for employee development.

Corrective Action

Steps taken to address deficiencies in employee performance based on appraisal outcomes.

Objective Data

Quantifiable information used to support performance evaluations and decisions.

Encouragement

Providing positive reinforcement to employees to boost morale and motivation during the appraisal process.

Rating Committees

Groups of individuals who evaluate employee performance to reduce bias and provide diverse perspectives.

Electronic Performance Management (EPM)

A system that allows managers to monitor employee performance through digital tools.