by Dexter Hansen
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As a person who has always considered myself seeking constant improvement,
I became interested in the use and application of performance appraisals.
Originally, I looked at the performance appraisal as an opportunity to find
out how I was doing compared to my boss's expectations. I later found, after
I had a department of 19 people to supervise and write appraisals for, that
the performance appraisal was a once a year nightmare if I didn't take notes
on my employees during the year.
The observations and understanding of the performance appraisal process helped reduce a monumental task into something much more manageable. Also, performing performance appraisals on highly technical people is much more difficult than doing them for employees that are performing routine or production oriented tasks. For production employees, developmental aspects and expectations for job growth are typically not as great. This is not always the rule. There are always a few employees who come along who want and need developmental planning.
Terms used to describe the various type of rating systems as well as a definition for performance appraisal is as follows:
Behavioral Anchored Rating Scales. - The term used to describe a performance rating that focused on specific behaviors or sets as indicators of effective or ineffective performance, rather than on broadly stated adjectives such as "average, above average, or below average". Other variations were:
Checklists. - The term used to define a set of adjectives or descriptive statements. If the rater believed the employee possessed a trait listed, the rater checked the item; if not, the rater left the item blank. rating score from the checklist equaled the number of checks.
Critical Incident Technique. - The term used to describe a method of performance appraisal that made lists of statements of very effective and very ineffective behavior for employees. The lists have been combined into categories, which vary with the job. Once the categories had been developed and statements of effective and ineffective behavior had been provided, the evaluator prepared a log for each employee. During the evaluation period, the evaluator recorded examples of critical behaviors in each of the categories, and the log has been use to evaluate the employee at the end of the evaluation period.
Forced Choice Method. - This appraisal method has been developed to prevent evaluators from rating employees to high. Using this method, the evaluator has to select from a set of descriptive statements, statements that apply to the employee. The statements have been weighted and summed to at, effectiveness index.
Forced Distribution. - The term used to describe an appraisal system similar to grading on a curve. The evaluator had been asked to rate employees in some fixed distribution of categories. One way to do this has been to type the name of each employee on a card and ask the evaluators to sort the cards into piles corresponding to rating.
Graphic Rating Scale. - The term used to define the oldest and most widely used performance appraisal method. The evaluators are given a graph and asked to rate the employees on each of the characteristics. The number of characteristics can vary from one to one hundred. The rating can be a matrix of boxes for the evaluator to check off or a bar graph where the evaluator checked off a location relative to the evaluators rating.
Narrative or Essay Evaluation. - This appraisal method asked the evaluator to describe strengths and weaknesses of an employee's behavior. Some companies still use this method exclusively, whereas in others, the method has been combined with the graphic rating scale.
Management by Objectives. - The management by objectives performance appraisal method has the supervisor and employee get together to set objectives in quantifiable terms. The appraisal method has worked to eliminate communication problems by the establishment of regular meetings, emphasizing results, and by being an ongoing process where new objectives have been established and old objectives had been modified as necessary in light of changed conditions.
Paired Comparison. - The term used to describe an appraisal method for ranking employees. First, the names of the employees to be evaluated have been placed on separate sheets in a pre-determined order, so that each person has been compared with all other employees to be evaluated. The evaluator then checks the person he or she felt had been the better of the two on the criterion for each comparison. Typically the criterion has been the employees over all ability to do the present job. The number of times a person has been preferred is tallied, and the tally developed is an index of the number of preferences compared to the number being evaluated.
Performance Appraisal. - The term performance appraisal has been called by many names, including performance review, performance evaluation, personnel rating, merit rating, employee appraisal or employee evaluation. A performance appraisal has been defined as any personnel decision that affects the status of employee regarding their retention, termination, promotion, transfer, salary increase or decrease, or admission into a training program.
Ranking. - The term ranking has been used to describe an alternative method of performance appraisal where the supervisor has been asked to order his or her employees in terms of performance from highest to lowest.
Weighted Checklist. - The term used to describe a performance appraisal method where supervisors or personnel specialists familiar with the jobs being evaluated prepared a large list of descriptive statements about effective and ineffective behavior on jobs.
There have been two prevalent approaches to performance appraisal. The first approach has been the traditional approach. This approach has also been known as the organizational or overall approach. The traditional approach has been primarily concerned with the overall organization and has been involved with past performance.
The second approach to performance appraisal has been the developmental approach. This approach viewed the employees as individuals and has been forward looking through the use of goal setting.
Performance appraisal for evaluation using the traditional approach has served the following purposes:
Two serious flaws in the traditional approach to performance appraisal exist. The flaws are:
The developmental approach to performance appraisal has been related to employees as individuals. This approach has been concerned with the use of performance appraisal as a contributor to employee motivation, development, and human resources planning. The development approach contained all of the traditional overall organizational performance appraisal purposes and the following additional purposes:
1. Provided employees the opportunity to formally indicate the direction and level of the employee's ambition
2. Show organizational interest in employee development, which was cited to help the enterprise retain ambitious, capable employees instead of losing the employees to competitors
3. Provided a structure for communications between employees and management to help clarify expectations of the employee by management and the employee
4. Provide satisfaction and encouragement to the employee who has been trying
to perform well.
The following is typically expected from company managers when doing performance appraisals:
The performance appraisal process typically consists of four inter-related
steps as follows:
For those interested in the Performance and Development Appraisal Forms I am use as a reference for this web page, I have two PDF downloads. The first is a sample performance appraisal that only has a two-point rating scale, "satisfactory" and "unsatisfactory". The second PDF file contains both a copy of a paper I wrote as a graduate student and a more complex form with a rating system.
Tip: When having performance appraisals done, it's a good idea to send along a form to have the manager identify the training needs for the next year. This will tie the developmental aspect of the performance appraisal to the training needs and get your training needs out of the way for your Sarbanes-Oxley Act / ISO / QS9000 requirements, if you have them.
From a Total Quality Management (TQM) perspective, there are a several reasons that traditional performance appraisals can hurt quality and teamwork. For those unfamiliar with the TQM concept, visit the TQM Tutorial/Help Page.
One negative aspect of traditional individual performance appraisals is that they can make employees compete against one another. How can this be done? If the ratings are known (or assumed, based on the employees rating given by the manager and their perceptions of where they stand relative to others), it can create discord in the work group. TQM is based on teamwork, however, if an employee asks for help, they can be penalized on their appraisals. When trying to encourage a TQM environment, the performance ratings should contain elements relating to teamwork (i.e. rated between teams instead of individuals).
The use of a rating system incorrectly can be a problem. When the rating system is forcing the overall performance for the various elements to fit a Normal Distribution or Student-T Curve, problems can occur. While statistically, for a large organization, this may sound reasonable. At the work group level, where the groups are small, it forces managers to have one employee rated extremely high and another rated extremely low. The reason for forcing entire employee population to fit the curve is that it keeps managers from rating everyone at the top end of the curve.
Traditional appraisals reinforce the traditional hierarchy and managers are expected to support their employees. In the traditional performance appraisal the manager sets (or approves) the goals and in effect, become a judge rather than working as a coach. Another negative is that managers are not always the best person to provide feedback on employees day to day activities as they spend less time with the employees than there lateral peers. In the instances where peers and/or customers actually are asked to provide input, their answers are tempered or screened by the managers, thereby constraining the sources of feedback.
Another danger of formalizing the performance appraisals into a highly
structured, tightly defined process using rigid criteria tied to merit increases
is that in the actual work world, goals are a moving target. Goals
are constantly changing to meet a changing, dynamic work environment
and never seem to fit an annual appraisal period. This can make it
difficult for managers to assign a specific monetary value on employee
contributions, particularly if they don't match the scale for allowable merit
In order to counteract the impact of traditional performance appraisals, trying to obtain feedback from the employee's peers and customers (a.k.a. an open appraisal). Providing a means for employees to provide feedback to the manager on the manager's performance can also improve the process. From a TQM perspective, it's recommended to merge planning and feedback into team meetings rather than one on one meetings. Appraisal periods should align with the timing of the work (i.e. provide feedback at the end of a major program or project rather than wait for an annual point in time). Team meetings should ask open ended, thought provoking questions (i.e. What would you do if you were running the operation and/or business?). The idea here during a team meeting on performance is not to set goals, but to come up with ideas to improve performance. Once a way for improving performance is developed, goals can be set.
Some quality experts even recommend getting rid of individual rating all together, however, others have came to a middle ground and recommend providing both individual and team feedback. It's difficult to develop employees without two-way communications between the manager and employee. Having experience in both doing performance appraisal, receiving performance appraisal, having been through the TQM process and being a quality manager, I prefer to think of quality and team work as different facets of an employee's performance. By soliciting feedback from the employee, the work group and customers, the employee receives a well-rounded perspective of how they are perceived and should help them in choosing a developmental plan to help them improve.
One problem with getting team feedback is that getting too many comments from the team may create problems if there are too many areas to improve in. In most cases, the recipients will have problems if they try to fix them all. The question of where to start improving first comes to mind. Team feedback should be limited to one focused area. Teams should also be asked to provide an example of what specifically can be done by the recipient to improve. When getting team feedback, be sure to solicit feedback on the recipient's strengths or accomplishments.
There are a number of low cost paper backs that can be handed out to the managerial staff to help them with thier appraisals. See the list on in the left hand column for books from Amazon.
Since the advent of the use of computers, a number of educational organizations are now using Performance Appraisal software. Performance Now Enterprise is a software tool for logging events, tracking goals, providing effective feedback, and writing employee reviews that maximize the potential of your team. Flexible enough to adapt to your present review system, Performance Now helps you become a better manager and get the best from your employees. For a lttle more upscale package, Performance Impact Workplace is easy to use to set goals for employees, but are having trouble following up on those goals.
Another software package , with an intuative graphic interface, geared towards the business environment is MINDSOLVE (MVP). MVP is designed as an enterprise level performance management software, incorporating appraisal, development resources, 360 degree feedback, performance logging, etc.. While the use of configurable software based tools are certainly making life easier, the use of such tools are much more valuable, if the user has an understanding of the basis for which they were written. I hope the information provide in this web site is useful in the understanding of Performance Appraisals.
There is also Reactive360. They offer a free 360 feedback process (online) for managers this includes the full graphical report in PDF generated at the end. Reactive360 is free to use 360 Feedback / 360 Degree Appraisal and they offer low cost fully flexible systems for employee appraisals. With instant access. they allow you to create your own questionnaires and brand the process.
For those needing help with other areas, visit other related web sites by the author as follows:
References are listed in the second PDF file listed above. Sorry, downloading the file is a requirement to obtain them.
This page is linked to Amazon.com. Click on items of interest for additional information or to order.
Performance Appraisal Tips Help Page List of Recommended Performance Appraisal Books and Software.
2600 Phrases for Effective Performance Reviews: Ready-to-Use Words and Phrases That Really Get Results -- by Paul Falcone; Paperback
The #1 Guide to Performance Appraisals: Doing It Right! --James E. Neal; Paperback
Performance Appraisal Phrase Book: Effective Words, Phrases, and Techniques for Successful Evaluations --Corey Sandler; Paperback
101 Sample Write-Ups for Documenting Employee Performance Problems -- Paul Falcone; Paperback
Effective Letters for Business, Professional and Personal Use: A Guide to Successful Correspondence -- James E. Neal; Paperback
Powerful Performance Appraisals: How to Set Expectations and Work Together to Improve Performance -- Karen McKirchy; Paperback
Effective Phrases for Performance Appraisals : A Guide to Successful Evaluations -- James E. Neal; Paperback
The Complete Guide to Performance Appraisal -- Richard C. Grote, Dick Grote; Hardcover
The Basics of Performance Measurement -- Jerry L. Harbour; Paperback
360 Degree Feedback : The Powerful New Model for Employee Assessment & Performance Improvement Mark R. Edwards, Ann J. Ewen (Contributor) / Hardcover / Published 1996
Catalytic Coaching : The End of the Performance Review Garold L. Markle / Hardcover / Published 2000
Competence at Work : Models for Superior Performance Lyle M., Jr, Phd Spencer, Signe Spencer (Contributor) / Hardcover / Published 1993
First Things Fast : A Handbook for Performance Analysis Allison Rossett / Hardcover / Published 1998
Increasing Productivity Through Performance Appraisal (Addison Wesley Series on Managing Human Resources) Gary P. Latham, Kenneth N. Wexley / Paperback / Published 1994
Appraisal : State of the Art in Practice (Siop Professional Practice
Series) James W. Smither(Editor) / Hardcover / Published 1998
Powerful Performance Appraisals : How to Set Expectations and Work Together to Improve Performance Karen McKirchy / Paperback / Published 1998
Employee Performance Measurement Workbook Jack Zigon / Perfect / Published 1998
Employee Appraiser Deluxe 4.0 /by Austin-Hayne / Platform: Windows 95, Windows 98, Windows NT / Media: CD-ROM
Policies Now 5.0 by Knowledge Point Windows 3.x, CD-ROM and 3.5" disk
(Job) Descriptions Now 4.0 by Knowledge Point Windows 3.x, CD-ROM and 3.5" disk
People Manager 2.0 by Knowledge Point Windows 95, Windows 98, Windows NT, CD-ROM
Ultimate Employer by Knowledge Point Windows 95, Windows 98, Windows NT, CD-ROM
Didn't find your book? Type in the name of the author, title or subject to search the Amazon.com selections.
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Copyright © Dexter A. Hansen