Performance Appraisal

Performance Appraisal

1. Assessment centers

   • Carrick and Williams (1999) suggest that for some development centers may have a demotivating effect, some may not feel that they need to improve their performance

2. The nature of an organization’s appraisal scheme is largely a reflection of its managerial beliefs, the resources available and the expertise it possesses

3. PA provides managers with a major opportunity to reinforce corporate values and attitudes and thus it appeals as an important strategic instrument in the control process

4. 2 broad categories; developmental and evaluative / administrative

   • Hard vs Soft HRM

5. Problems & Errors

   • Employees typically attribute episodes of poor performance to factors beyond their control e.g. the equipment wasn’t working, whereas employers are more likely to attribute poor performance to the employee
   • Unintentional errors: rating employees too positively (leniency errors) or too negatively (strictness error). Raters might be overly sensitive to a particular dimension of an employee’s performance so that when they do well on this dimension that rate the employee highlight (halo error) or when they do poorly on this dimension (horn error).
   • Women are less likely to get a high performance rating relative to their male counterparts. Women are more likely to receive critical feedback. The pro-male bias in performance ratings is particularly prevalent when women are in jobs traditionally carried out by men and the supervisor has strong gender stereotypes
   • When a supervisor likes an employee they are more likely to get a higher performance rating
   • Only 6% of HR executives thought PA was an 'excellent' use of time
   • There is a growing concern that PA systems, because of their focus on improving the ‘bottom line’, have added to the pressures of work for employees. There is increasing concern that employees are now being performance managed to exhaustion and burnout which negatively affects organizational performance

6. ‘glass ceiling’ suggests that there are limits on women’s progress in organizations (only 30% are managers) with similar problems for Asian, black and minority ethnic managers

   • There are many reasons for this, largely relating to biased and stereotyped judgements about performance - one explanation for the occurrence of these distortions in judgement during PMS is provided by social role theory – which suggests that social structures influence the roles that people can adopt and the behaviors that are expected = Similarity bias = managers rating people who are similar to them more highly and as more managers are men...

7. PMS

   • The adoption of a PMS represents an attempt by an organization to show a strategic integration of its HRM processes which can together be linked to the goals and direction of an organization. Yet PMS rely much on the role of managers and the quality of their relationships with employees and it therefore represents something of a conundrum for HR managers
     • A key feature of a PMS is its attempt to provide a link between all levels of an organization through goals, critical success factors and performance measures. An organization’s goals will thus be derived from business strategy and translated into sector goals, departmental goals, manager goals and employee and or team goals respectively
   • PM Cycle; Performance review - PDP + goal setting - performance review + feedback 1 - half year appraisal - performance review + feedback 3 - end year appraisal - repeat
   • There should also be on-going coaching from the immediate manager - many organizations seek to develop a 'coaching culture'
   • A PMS can be used for a variety of purposes, which can broadly be categorized as
     • To make administrative decisions concerning pay, promotions and careers and work responsibilities – the control purpose
       • A manager may be required to make a decision about the value of an employee both in the present and future and this may cause some discomfort. A key reason that appraisal fails is that managers dislike ‘playing God’ which involves making judgements about the worth of employees (McGregor 1957). Managers may experience appraisal as hostile and aggressive act against employees that resulted in feelings of guilt (Levinson, 1970)
     • To improve performance through discussing development needs, identifying training opportunities and planning action – the development purpose

8. Feedback has to be informative and perceived as fair (Gilliland 1993)

   • ‘feedback acceptance’; the way in which individuals respond to feedback or how people perceive the accuracy of the feedback - based on the extent to which feedback confirms how people see themselves
     • The response to feedback can result in two possibilities; validation if there is agreement with the judgement made or a defensive posture when there is disagreement (especially likely when feedback is negative or critical and the impact on subsequent performance can also be negative)
     • Research found that 1/3 cases, feedback had a negative effect on performance, especially if feedback has a strong impact on an employee’s view of ‘self’ e.g. self-belief or esteem
   • Because of the dangers of negative feedback, Kluger an Nir (2000) have suggested a positive approach, especially in appraisal interviews called feedforward – a win-win approach is adopted that avoids a retreat into defensive emotions by focusing on stories of experience from work that can look forward to provide support so that performance can improve

9. Desired benefits of PA

   • Improving motivation and morale, Clarifying expectations and reducing ambiguity, Determining rewards, Identifying training and development opportunities, Improving communication, Selecting people for promotion, Managing careers, Counselling, Discipline, Planning remedial actions, Setting goals and targets

10. There is no point in doing performance management if it does not deliver the business objectives. It should enable you to take action at the individual level if people are pulling in the right direction…everyone whatever level they are knows where their personal key performance indicators fit

11. Feedforward; weaknesses are not ignored, but are minimized so by a ratio of 3 positives to one negative is maintained to ensure positive energy and emotions

12. As long ago as 1983, Harper suggested dropping the world ‘appraisal’ because it put employees on defensive. He recommended instead a shift towards future-oriented review and development that actively involved employees in continuously developing ways of improving performance in line with needs similar to feedforward interview process.

13. Rating Performance

    • Rating inputs is a broad and potentially vague category that has traditionally been concerned with listing traits or personality attributes, typical attributes are; dependability, loyalty, decisiveness, resourcefulness and stability - difficult to define and unreliable – subject to bias and unfairness
    • Failure here affects moral and overall performance
    • Many organizations now prefer to use reliable and valid psychometric instruments as a way of helping employees to diagnose strengths and weaknesses for a development plan • Ratings based on results and outcomes of work performance provide the most objective technique for collecting data for appraisal e.g. production, sales, number of satisfied customers or customer complaints
    • Behavior-anchored rating scales (BARSs)
    • Behavior observation scales (BOSs)
      • goals developed using BOSs were more specific thank BARS since they were based on what the ‘rater’ actually observed plus BOSs require a rating of several behaviors rather than the identification of a single anchor – reduces bias and allows more specific feedback = clearer goals