Methods of Performance Appraisal in Human Resource Management

Human Resource Management Class: Bcom III (VI sem) Topic: Methods of Performance Appraisal College: I.B.(P.G) College, Panipat Affiliated to Kurukshetra University (By prof. Pooja Dudeja)

(MEANING ) Performance appraisal is the process of measuring quantitatively and qualitatively an employees past or present performance against the background of his expected role performance . Evaluation of the performance and personality of each employee is done by his immediate superior or some other person trained in the techniques of merit rating . various rating techniques are employed for comparing individual employees in a group in a terms of personal qualities or deficiencies and the requirements of their respective jobs .

(METHODS OF THE PERFORMANCE APPRAISAL ) A. TRADITIONAL METHODS 1. Confidential Report in most of the govt. departments and public enterprises , performance appraisal is done through annual confidential reports . these reports differ from department to department and from level to level . the confidential report is written for a unit of one year and relates to the performance , ability and character of the employee during the year . METHODS OF THE PERFORMANCE APPRAISAL Traditional Methods Modern Methods 1. Confidential report 2. Graphic scales 3. Straight ranking 4. Paired comparisons 5. Grading system 6. Forced distribution 7. Check list method 8. Critical incident method 9. Group appraisal 10. Nominations 1. Assessment centre 2. Human resource accounting 3. Management by objective 4. 360 degree performance appraisal

The graphic scale is the simplest and the most popular method for appraising performance . A raiting scale lists traits and a range of performance values of each trait . 3. Straight ranking method Every employee is judged as a whole without distinguishing the rates from his performance . a list is then prepared for ranking the workers in order of their performance on the job so that an excellent employee is at the top and the poor at the bottom . it permits comparison of all the employees in any single rating group regardless of the types of the work . 4. Paired comparisons method In this method every person is compared trait-wise , with other persons , one at a time , the number of times one person is compared with others is tallied on a piece of the paper . these numbers help in yielding rank orders of the employees. 5. Grading system Under this system features like analytical ability , co-operatives , dependability , job-knowledge , etc.are selected for evaluation . the employees are given grades according to the judgement of the rater .

6. Forced distribution method some raters suffer from a constant error i.e. they rate of employees as only good , average as poor . they thus do not evaluate the employees properly . this system minimizes rather s bias so that all employees are not similarly rated. This system is based on the presumption that all employees can be divided into the categories outstanding , above average , average , below average and poor . the rater is asked to place 10 percent persons in outstanding group , 20 percent in above average , 40 percent in average , 20 percent below average and 10 percent in poor category . 7. Check list method A check list is a list of statements that describes the characterstics and performance of the employees on the job. The rater checks to indicate whether the behavior of an employee is positive or negative to each statement . B. MODERN METHODS 1. Assessment centre An assessment centre generally measures interpersonal skills , communication skills , ability to plan and organise , self confidence , resistence to stress , mental alertness etc. assessment centre is a time consuming and expensive method . the ratings of this method are said to be strongly influenced by the participant interpersonal skills . judges tend to evaluate the quality of the individual social skills rather than quality of the decisions themselves .

2. Human resource accounting Human resource are a valueable asset of any organization . this asset can be valued in the terms of money. Human resource accounting method attaches money value to the value of a firm s internal human resources and its external customer goodwill .when competent and well trained employees Leave an organization the human asset is decreased and vice versa . under this method , performance is judges in terms of costs and contributions of the employees . 3. Behaviourally anchored rating scale (BARS) a behaviourally anchored rating scale combines the benefits of critical incidents and graphing rating scales by anchoring a scales with specific behavioural examples of good or poor performance .however , BARS is very time consuming and expensive method . secondly , behaviours used are more activity oriented then result oriented . several appraisal forms are required to accommodate different types of jobs in an organization . despite its intial appeal , this method is not necessarily superior to the traditional methods of the appraisal . 4. Management by objectives (MBO) In its basic form , management by objectives requires the managers to set specific measurable goals with each employee and then to periodically discuss his progress towards his goals .

Set the organizations goals . Set departmental goals . Discuss departmental goals. Define expected results . Performance reviews ; Provide feedback . 5. 360 degree performance appraisal . it is understood as systematic collection of performance data on an individual or group , derived from a number of stake holders the stake holders being the immediate supervisors Team members , coustmers , peers and self . the appraiser should be capable of determining what is more important and what is relatively less important . he should assess the performance without bias .

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