Human Resource
Information Systems
ETHICS IN HUMAN
RESOURCE MANAGEMENT
MERGING AND HR
EMPLOYEE SEPARATION AND TURNOVER
RECORDKEEPING IN HR
BACKGROUND CHECKS
HUMAN RESOURCE PLANNING
SUPPLY FORECASTING
OUTCOMES OF THE HR PLANNING PROCESS
HUMAN RESOURCE MANAGEMENT SYSTEMS
SOFTWARE EXAMPLES
BIBLIOGRAPHY
MERGING AND HR
EMPLOYEE SEPARATION AND TURNOVER
RECORDKEEPING IN HR
BACKGROUND CHECKS
HUMAN RESOURCE PLANNING
SUPPLY FORECASTING
OUTCOMES OF THE HR PLANNING PROCESS
HUMAN RESOURCE MANAGEMENT SYSTEMS
SOFTWARE EXAMPLES
BIBLIOGRAPHY
Human Resource Information Systems (HRIS) have
become one of the most important tools for many businesses. Even the small,
twenty-person office needs to realize the benefits of using HRIS to be more
efficient. Many firms do not realize how much time and money they are wasting
on manual human resource management (HRM) tasks until they sit down and
inventory their time. HRIS is advancing to become its own information technology
(IT) field. It allows companies to cut costs and offer more information to
employees in a faster and more efficient way. Especially in difficult economic
times, it is critical for companies to become more efficient in every sector of
their business; human resources (HR) is no exception.
In his 2008 book, The New Human
Capital Strategy, Bradley Hall defines human resources management as
watching over and growing human capital, one of the greatest aids businesses
have in gaining competitive advantage. The modern human resource concept is
based on four integrated parts: skills, structure, systems, and shared values.
Skills are the abilities and knowledge that people bring to an organization.
Structure refers to the communication channels within the human resource
department, who manages and who is accountable. Systems are the tools used to
make human resource decisions, the reviews and measures HR managers control.
Shared values are the less tangible beliefs and cultural strengths an organization
possesses. This four-part concept has been used since the 1960s and still
functions as a basic understanding of human resources in the business world.
Although the basic components of the modern
human resource system have stayed relatively unchanged since their inception,
HR operations are still subject to flaws. According to a study cited by Hall,
75 percent of
studied companies attempt to bend
prefabricated HR plans to their particular needs without considering a more
integrated, top-down strategy. In many cases, lower-level managers were
involved neither in creating the HR processes nor in implementing them. Others
chose to focus more on assumed HR positions such as compensation director and
staffing director, rather than overall business strategy. Few implemented
third-party regular reports and accountability standards. There are, then, many
opportunities available for companies to improve their existing HR systems.
ETHICS IN HUMAN RESOURCE MANAGEMENT
Ethical considerations are becoming
increasingly important to HR departments in American industries. A tension
often exists between a company's financial goals and strategies to improve
profits, and ethical considerations with right-behavior concerns. Since human
resources departments are often most focused on employees and employee
behavior, it falls to them to define ethical behavior, communicate specialized
ethical codes, and update or elaborate on existing right-behavior expectations.
Human resource management systems are expected to communicate ethical values
and so improve company performance.
In the absence of a fully separate ethics
department, HR departments can struggle with this ethical burden. A 2008 study
done by SHRM, the Society for Human Resource Management, showed that over 50
percent of employers did not make ethical considerations part of their employee
evaluations. About half of employees did not think they had means to find
ethical advice within their company, and even 19 percent of human resources
professionals felt pressure to compromise their ethical standards, coming from
multiple directions within their companies, though the HR department was the
primary resource for ethical information in 80 percent of studied companies.
One of the ways the HR department can support
ethics management for their company is through the maintenance of a code of
ethics. Briefly, an ethical code for a business should help employees build
trust with each other and their company, while clarifying any uncertain or gray
areas that may exist in the company's ethical considerations. Instead of only
supporting existing ethical standards, a proper code of ethics should seek to
raise the standard and improve employee behavior. The code should show members
of the company how to make judgment decisions and encourage such proper
decision making, while at the same time providing enforcement protocols to
prevent misconduct. When writing the code of ethics, an HR department should be
sure to do the following:
·
Create clear
objectives for the code and other ethical endeavors to accomplish within the
organization.
·
Bring all levels of
the organization into the process of creating the code, gaining support
throughout the company.
·
Check on all the
latest legislation, both national and state, that may affect the company's
ethical processes, expectations, and requirements, so that the ethical code can
be as current as possible.
·
Use the clearest
language possible, making the code accessible and simple to understand.
·
Willingly answer
realistic problems and address real-life scenarios so that employees will have
clear answers to their questions.
·
List several resources
for employees to seek continuing ethical education, from other reports by the
HR department to helpful Web sites that can provide guidance.
·
Keep in mind that the
code of ethics is meant to be used, making sure that it is communicated to all
levels of the organization and readily available to any employee who may need
aid making judgment calls.
A code of ethics is only one part of the
entire ethical system in an organization. The HR department should also make
use of several other ethical tools to ensure employees are practicing
right-behaviors and fully understand their ethical requirements.
MERGING AND HR
Whenever there is merger activity, the HR
department often has a large responsibility to make sure that employee
transitions go smoothly. When companies merge, some of the most significant
changes occur in number and treatment of employees. If human resources can
successfully deal with these important issues, they can have enormous impact on
the success of the transition.
First, the HR department should ascertain the
precise number of companies and company subsidiaries involved in the merger.
This will give a clear idea of how many employees will be involved in the
transition. Some of these employees may work in different businesses or on
different products than the HR department has previous experience in, requiring
new protocols. Employees across all companies involved will have a variety of
reactions to the merger, raising both ethical and temperamental issues for the
HR department to solve. To prepare for these issues, HR should pinpoint the
managers involved in the
company integration, and gain their assistance
throughout the merging of the business lines.
In certain mergers there will be an excess of
employees, requiring multiple layoffs. The HR department should ascertain how
many excess positions there are and how they will communicate the layoff
information to employees and managers alike. Legal issues should also be dealt
with; a legal consult with someone who has experience in mergers can be an
excellent asset. If employees will be terminated in the merger, it is also up
to HR to find out how severance pay and extended benefits will be distributed.
Will the company provide assistance for employees seeking new jobs? The HR
department will be in charge of such out-placement assistance, and the
protocols for who gets such assistance and what qualities (experience,
position, etc.) extended benefits will be based on.
While layoff deadlines are being established
and employee benefits managed, the HR department should also perform a careful
internal audit. The companies merging will have differing employee handbooks
offering two sets of employee instructions regarding training and expected
behavior. Most will also have different instructions for managers and their
treatment of personnel, including chains of communication and conflict
resolution. The HR department should be sure to review these separate manuals
and create one unifying handbook for the merged procedures. Other plans
requiring combination by HR include compensation plans, employee benefits, and
ethical standards.
EMPLOYEE SEPARATION AND TURNOVER
One of the most important functions of HRM is
to oversee smooth and successful employee separations and turnover. There is
always a certain amount of employee turnover at any company, with people
voluntarily quitting their jobs for a host of different reasons. These employee
separations differ from normal personnel losses resulting from acquisitions, in
which employees are laid off and not replaced. For every separation, HR must
use recruitment strategies to find a new employee and make sure that the
company workforce does not suffer through less skilled workers or workers who
are more likely to quit.
There are three types of external employee
movement that concern HR departments. The first consists of pure growth, or
acquisitions where the company only gains employees without having an excess to
lay off, usually involving the annexation of a department or production line.
The second type is pure reduction, or movement that only loses employees, such
as a series of layoffs to cut costs. Third is all the possible combinations of
the first two.
When HR needs to manage such employee
separation (and the collective efforts to replace them with other talented
workers), separation is divided into three different components, from which
policies toward the change can be formed. The first component is quantity: how
many employees are leaving the company? These leaving employees, once
quantified, are sometimes separated further into categories based on company
branches or position. The second component is the quality of employees leaving
the organizations. This can refer to the positions they held, the particular
talents they possessed (which may be hard to replace), and how they fit into
the company's strategies. The third component consists of the costs to the
company (costs involved in losing employees, recruiting new ones, and/or training
those acquired during a merger).
Succession Planning. Succession planning is another vital
part of the HR planning process. It refers to the way in which a company forms
policies for replacing key members of its organization, shifting transfer of
authority and responsibility carefully from a leaving member to a new member.
Often, this means making sure that an arriving employee has the necessary
training and experience to fulfill their functions.
RECORDKEEPING IN HR
Another major concern of the HR department are
employee personnel records. These records are filed, maintained, and updated
through HRM processes. A good HRM system will allow access to files both by the
employee they belong to and the managers who require them. Among the
informational data kept in employee files, HR should make sure the files
include names, addresses, telephone numbers, marital status, dependents, and
beneficiaries.
Most HRM strategies have policies established
regarding treatment of personnel information. Companies usually collect
information that is required only for legal reasons, or reasons necessary to
that business. Employees are given chances to read and correct their files, and
files are kept strictly by the company, with rules in place for viewing,
maintenance, and outside transfer.
Certain pieces of legislation passed affect
the storage and retrieval of personnel records. The Sarbanes-Oxley Act requires
that every company has some confidential system in place for the communication
of fraud-related activities and malfeasance. The Securities and Exchange
Commission (SEC) has recently begun to penalize brokers who do not keep
complete and detailed records of all their transactions, and the Health
Insurance Portability and Accountability Act (HIPAA) requires that all
electronic records concerning patients be put
into an easy-transfer format.
BACKGROUND CHECKS
HR departments also manage background checks
for potential employees, an increasingly important job as the risk of hiring a
misrepresenting employee rises. USA Fact, a provider of screening services for
recruiting departments, recently conducted a survey of over 300,000 background
checks, and found that among the potential employees, 5 percent had criminal
histories, more than a third had motor vehicle violations, 18 percent had
employment histories that could not be verified, and approximately 11 percent
had been falsifying their education experience. By catching fraudulent records
such as these, human resources departments can significantly reduce employee
theft, turnover, and even workplace violence.
The sorts of background checks companies can
perform include criminal background reviews, Social Security number
verification, employment history and education verifications, professional
license verification, credit history reviews, and motor vehicle record checks.
There are several guidelines that can be used
when HR departments form policies on conducting background checks. First, all
inquiries should be strictly related to the position HR is trying to fulfill.
Second, all background checks should first be agreed upon by the employee—formal consent in writing is the best way.
This gives employees a chance to rethink their applications, especially if they
realize a background check would disqualify them for the position. Third,
employers should be reasonable. If background checks become over-extensive,
they could cost the company too much money and the organization could risk
invasion of privacy charges.
HUMAN RESOURCE PLANNING
HR planning attempts to connect employees to
the vision, needs, and strategic plans of the company, including management of
all aspects of human resources. Essentially, good HR planning will ensure that
the best possible employees (with the right talents, ambitions, and
personalities) will find the best possible positions within the organization.
HR planning can be done in both the short and long term, although long-term
strategies are the most common for HR planning purposes.
When HR planning, the company should tie in
all of its HR processes to the company's goal and objectives. If HR planning
does not exist to further specific objectives of the country, it is not
fulfilling its purpose. This can lead to very wide parameters in HR planning,
which can include most activities involving connections between employees and
the structure of the business itself. There
|
Exhibit 1
HR Trend Analysis for a Manufacturing Firm |
|||||
|
|
2006
|
2007
|
2008
|
2009
|
2010
|
|
Projected sales
(thousands of dollars) |
10,200
|
8,700
|
7,800
|
9,500
|
10,000
|
|
Number of employees
|
240
|
200
|
165
|
215
|
?
|
are many types of analysis HR planning can
use, including the following:
·
Workforce
analysis judges the
future trends of specific jobs in the company and how they will change, such as
technological trends, expected surpluses or layoffs, and needed skill sets.
·
Internal
scans are used to
identify key movements and patterns within the organization which may affect HR
operations.
·
External
scans look at outside
factors which affect employment, such as economic conditions and the need for
certain skills.
·
Gap
analysis is used to plot
where the HR policies currently are, where they will need to be to meet future
goals, and how a company can move ahead in its human resources strategy.
·
Priority
setting allows HR
managers to set HR priorities and form strategies for reaching them, based on
information previously gathered through other scans.
Demand Forecasting. Demand forecasting is the process of
judging future trends in the employment market so that good HR recruitment
decisions can be made. It involves analysis of such factors as competition,
international movements, legislation, and changes in both technology and
society. With proper demand forecasting, employers will be able to tell what
skill sets their new employees will need and what positions will become more
necessary to business. They will also be able to accurately budget for
recruitment endeavors.
There are many different techniques used in
demand forecasting, including those listed here:
·
Managerial judgment is
a type of brainstorming that involves a meeting of managers who gather to
diagnose and predict the future job market. These can generally be either
top-down or bottom-up, with either the executives forming their plans and trend
analysis for discussion, or the mid-level managers bringing their forecasts to the
meeting. The best
types of managerial judgment will combine forecasts from many sources, including HRM.
types of managerial judgment will combine forecasts from many sources, including HRM.
·
Ratio-trend analysis
involves researching past trends in organizational employment, with an eye on
current changes the organization is going through, to come up with reliable
projections concerning future activity. This usually involves ratios, such as
that between the number of workers and the revenue of the company. An example
of a trend analysis is illustrated in Exhibit 1, which depicts the relationship
between a business factor (namely, sales volume) and workforce size. As one can
see from the exhibit, if the company expects its 2010 sales to be $10 million,
it will need to increase its workforce to a size of nearly 240, which is the
number of employees it had in 2006 when sales were $10.2 million.
·
Regression analysis is
a more advanced version of ratio-trend analysis, involving the plotting of past
relationships so that regression lines can be drawn and trends planned out. An
example of how regression analysis can be used to project HR demand is shown in
Exhibit 2. In this example, the figures used in the trend analysis (Exhibit 1)
are now depicted in the form of a scatter diagram. The line running through the
center of the points plotted on the scatter diagram is the regression line. To
determine the number of employees needed when the sales volume is $10 million,
one would follow the path indicated by the dashed line. One would start at the
point on the X axis reading “10,000” and then move up vertically until
reaching the regression line. The value on the Y axis corresponding to that
point (i.e., 230) reflects the needed workforce size.
·
The Delphi technique
involves recruiting experts on employees and employee trends, and gathering
their various forecasts concerning job markets. The resulting statistics are
then combined and recombined until the final result is a usable forecast.
·
Structured analogies
are similar to regression analyses, but they are more creative-oriented,
comparing past scenarios involving employment trends and looking at examples
from similar situations in the past.
·
Judgmental
decomposition tries to break a forecasting situation down into smaller parts,
which are then separately analyzed and recombined to form a complete view.
These are just some of the techniques used in
demand forecasting—what other techniques a company decides to use
are based on its HRM strategy.
Judgmental Approaches. Judgmental approaches to demand
forecasting involve the use of human judgment, rather than a manipulation of
numbers. Two of the most commonly used judgmental techniques are group
brainstorming and sales force estimates. The group brainstorming technique of
demand forecasting uses a panel of experts (i.e., people within the
organization who collectively understand the market, the industry, and the
technological developments bearing on HRM needs). These experts are asked to
generate a forecast through the process of brainstorming. A variety of
brainstorming techniques exist. Most involve a face-to-face discussion among
group members, who are asked to reach a consensus.
When using a group brainstorming technique
to forecast human resources demand, participants must make certain assumptions
regarding the future. That is, they must examine the firm's strategic plans for
developing new products or services, expanding to new markets, and so forth,
and then try to predict such things as:
·
Future marketplace
demands for the organization's products and services
·
The percentage of the
market that the organization will serve
·
The availability and
nature of new technologies that may affect the amounts and types of products or
services that can be offered
The accuracy of the forecasts depends on the
correctness of these assumptions. Of course, the future is very difficult to
predict because it is subject to many uncertainties. Therefore, the
organization must continually monitor its demand forecasts in light of any
unexpected
changes. HRMS packages facilitate the
calculation and monitoring of demand forecasts.
The use of sales force estimates
represents another judgmental approach for forecasting HR demand. This approach
is most appropriately used when the need for additional employees arises from
the introduction of new products. When a new product is launched, sales personnel
are asked to estimate the demand for the product (i.e., expected sales volume)
based on their knowledge of customer needs and interests. The organization then
uses this information to estimate how many employees will be needed to meet
this demand. One drawback of this approach is the possibility of bias. Some
sales personnel may purposely underestimate product demands so they will look
good when their own sales exceed the forecasts. Others may overestimate demand
because they are overly optimistic about their sales potential.
SUPPLY FORECASTING
Once a demand forecast has been made, an
organization has a relatively good idea of the number and nature of positions
it will need to carry out its work at a particular point in time. It then
estimates which of these positions will be filled at that time by individuals
who already are employed by the company. The process used to make this
estimation is called supply forecasting.
Supply forecasting is a two-step process. HRMS
packages provide the employer with the means to automate much of these two
steps. In the first step, the organization groups its positions by title,
function, and responsibility level. These groupings should reflect levels of
positions across which employees may be expected to advance. For instance, the
HRM group might include the job titles of HR assistant, HR manager, and HR
director. The secretarial group might include secretarial clerk, principal
secretary, senior secretary, and administrative assistant.
The second step of supply forecasting is to
estimate, within each job group, how many current employees will remain in
their positions during the planning period, how many will move to another
position (e.g., through transfer, promotion, or demotion), and how many will
leave the organization. These predictions are partially based on past mobility
trends (e.g., turnover and promotion rates). The organization also should
consider any plans for mergers, acquisitions, unit or division divestitures,
layoffs, retrenchments and downsizing, and even hostile takeovers. When making
its supply forecast, the organization also should look at specific individuals.
Some may have already announced, for instance, that they are retiring at the
end of the year, returning to school in the fall, or getting married and
planning on moving to a different part of the country.
Computerized statistical packages are
available to help estimate the flow of employees through an organization. The
estimates generated by these packages can be fairly accurate in stable environments.
When the environment is unstable, of course, these estimates are suspect. For
instance, an organization may base its estimates on past turnover rates, which
have been about 10 percent during each of the past five years. If the turnover
rate were to change drastically because of factors such as job dissatisfaction
or downsizing, the organization would severely underestimate its future
staffing needs.
OUTCOMES OF THE HR PLANNING PROCESS
When the HR planning process is completed, a
firm must establish and implement HRM practices in order to meet its human
resource needs. Following is a brief overview of how HRM practices can help
organizations deal with anticipated oversupplies and undersupplies of
personnel.
The trend toward organizational restructuring
usually results in a smaller workforce. Therefore, when an organization's
strategic plan calls for restructuring, the HRM response usually is one of
downsizing. Downsizing usually results in layoffs. Because of the negative
outcomes that are often associated with layoffs, employers are encouraged to
seek alternatives, such as hiring freezes, early retirements, restricted
overtime, job sharing, and pay reductions.
When the results of demand and supply
forecasting project an undersupply of personnel at some future point in time,
the organization must decide how to resolve this problem. The solution may
involve hiring additional staff, but there are other options. When HR plans
indicate an undersupply of employees, firms can recruit personnel to staff jobs
with anticipated vacancies. HRMS packages provide employers with capabilities
to carry out recruitment in all of its steps. The first step is to conduct a
job analysis to determine the qualifications needed for each vacant job.
The next step is to determine where and how to
recruit the needed individuals. For instance, a company must decide whether to
fill its vacancies externally (i.e., from the external labor market) or
internally (i.e., from its own current workforce). When recruiting externally,
an organization should first assess its attractiveness in the eyes of potential
applicants; unattractive employers may have trouble generating a sufficiently
large applicant pool. Such employers should attempt to increase the number of
people who are attracted to the organization and thus interested in applying
for a job there. This may be accomplished by increasing starting pay levels
and/or improving benefit packages. Another option is to target certain
protected groups whose members may be
underemployed in the local labor market, such
as older, disabled, or foreign-born individuals.
Internal recruitment efforts can be improved
through the use of career development programs. When designing such a program,
the organization should collect work history and skill-level information on
each of its employees. Such information would include age, education level,
training, special skills (e.g., foreign language spoken), and promotion record,
and should be stored on a computer. This employee information allows the
organization to identify current employees who are qualified to assume jobs
with greater responsibility levels. For instance, in departments where skilled
managers are in short supply, a management replacement chart can be prepared
that lists present managers, proposes likely replacements, and gives an
estimate of when the replacement candidate will be trained and available to
fill an open position.
Instead of hiring new workers to meet
increasing demands, an organization may decide to improve the productivity of
the existing workforce through additional training. Other options include the
use of overtime, additional shifts, job reassignments, and temporary workers.
Another option is to improve retention rates. When this aim is met, firms will
have fewer job vacancies to fill.
Retention rates can be improved at the outset
of the employer/employee relationship, when applicants are first recruited.
Retention rates are likely to improve when applicants are given a realistic
preview of what their jobs would actually be like (warts and all), rather than
an overly glowing one.
Workers want to feel valued and needed by
their organization. In a climate characterized by mergers, acquisitions, and
layoffs, many workers feel very insecure about their jobs. Employees with such
feelings often begin shopping around for other jobs. These fears can be eased
by implementing HR plans for training and cross-training. Such plans allow
workers to perform a variety of functions, thus ensuring that they have the
necessary skills to continue making contributions to the firm. Management
training also is crucial in this regard. Organizations must train managers to
be good supervisors. Poor “people management” is a primary cause of voluntary
turnover. Managers at all levels should know what is expected of them, in terms
of managing people instead of just managing budgets.
HUMAN RESOURCE MANAGEMENT SYSTEMS
Several major software companies provide HRMS
packages. SAP, PeopleSoft, Oracle, and ADP are the largest. Depending on the
company's needs and size, package options may include some or all of the
following services:
·
Employee career cycle
management
·
24/7 data access to
authorized managers
·
Customized levels of
access to confidential data
·
Pre-populated forms
and templates
·
Access to real-time
data—with instantaneous updates
·
Employee
administration
·
Benefits
administration
·
Compliance
·
Recruitment
·
Performance and
development
·
Safety and health
·
Succession planning
·
Time-off management
·
Organization
management
·
Payroll
·
Training
·
401(k) plan
administration
The opportunities to add more services are
endless and continue to improve.
For most companies, the hardware and software
needed to run these programs are fairly standard. Hardware and software is
dependent on the complexity of the HRMS package; more complex HRMS packages
require more hardware (e.g., server space and speed).
Another benefit of HRMS includes allowing HR
to transition from an administrative department to a strategic management
department. The strategic value aspect of the HRMS investment focuses on
managing human capital by supporting functions such as recruitment,
performance/competency management, employee development, and employee customer
service. By executing well in these areas, companies can reduce employee
turnover, reduce hiring costs, and improve individual performance.
Another HRMS trend is the use of online
surveys. This allows companies to get fast information on their employees,
policies, procedures, competition, and anything else they decide to survey.
This also gives employees a sense of belonging and contributing to their
company. Online employee surveys usually have an 80 percent return ratio, which
is much higher than paper surveys.
Employees are becoming more self sufficient in
the workplace because of HRMS and the growth of technology. They are able to
answer questions, download forms, enroll in benefits, change payroll options,
and complete training on their own. This saves both time and money. An employee
does not have to make several phone calls in order to speak with the one person
who knows the answer
to their questions. Answers are readily
available, usually on the company intranet. This also frees up HR to focus on
more profitable activities for the company, such as recruiting and employee
development.
Another growing trend includes improved
methods for monitoring and managing employees' use of the Internet. This helps
management to improve productivity, reduce legal liabilities, and control IT
costs. Companies are blocking e-mail that may be offensive in order to reduce
legal liabilities. They also are blocking Web sites that are inappropriate for
workplace viewing. This has improved productivity by reducing nonproductive
activities.
HRMS providers have products for companies of
all sizes. These providers profit by maximizing the services they offer.
Therefore, they are going to target large companies that need more support.
However, providers are still interested in small companies, and those that will
need more support as they grow.
...............................................
Different types
of Performance Appraisal System
·
September 4, 2013
·
No Comments
·
by Uma Rajavelliah
Performance appraisal system is assessment of employee for
his/her work. The manager who is closely tied with the employee observes and
assesses his/her work throughout the year and provides necessary feedback,
guidance and forward looking path. The manager holds formal discussion with the
employee narrating his/her input on employee’s good work and places where
improvement is needed. Manager also identifies opportunities for the employee
to grow professionally.
Purpose of Performance Appraisal System
Having known what performance appraisal is, I shall tell you the
purpose of it.
The primary purpose of performance appraisal system is to
improve performance at all times in the future. It helps organizations identify
and categorize employees based on how they work. This classification helps
organizations motivate the performers and provide proper training to under
performers.
Types
of Performance Appraisal System
Appraisal does not only involve managers. It is more like an
exponentially growing curve – each vertices are like self, peers, manager on the
graph who add value to the employee appraisal process and help them grow along
the curve. Simply say, take a look at the following types.
General Appraisal
It is an ongoing communication between the manager and the
employee throughout the year. End of the year, they will determine if the
pre-set goals and objectives were met, provide feedback and set new goals.
360-Degree Appraisal
It allows other employees to provide feedback about their
experience with a specific employee. This feedback of peers can be reviewed by
manager and considered for appraisal process.
Technological Performance
Appraisal
It assesses technical expertise/capabilities of an employee. It
figures out employee throughput and identifies how sound he/she is technically.
Employee Self-Assessment
The employee assesses himself/herself and it is finally compared
with the manager’s completed assessment results. It is followed by discussions
and if there are differences, manager speaks to the employee about it.
Manager Performance
Appraisal
In this type, managers go through the appraisal process. It is
the role of the manager that is very crucial handling both the team and the
client. Manager has to satisfy the clientele without disrupting the (team’s)
employee morale. Most often manager appraisal process involves feedback from
the respective team members and sometimes from the client as well.
Project Evaluation Review
This is one of the best ways to identify how good an employee is
at work. Rather than to wait to review an employee end of the year, it helps
evaluating employees end of each project.
Sales Performance
Appraisal
A sales person is judged by the goals he/she has set versus
his/her results. Salesmen are closely held to the financial goals of any
organization. The manager and salesperson must find out ways to achieve goals
prior to which they must set realistic goals.
Well, let me now tell you how to design a review form.
How to structure a REVIEW FORM?
Business needs, organization structure and even work etiquette
might differ depending on the culture adapted within the organization. But what
remains constant is the structure of the review process. Let me give you a
clear picture of how a review process should be:
I shall start with goal setting as no review takes place without
goal in place.
Goal setting:
Every organization forecasts future and has standard goals to be
achieved for every financial year. Goal (with respect to organizations) is
nothing but how an organization should be end of the year. All the employees of
the organization are educated on the goals to work towards it. The end result
is evaluated based on the goals achieved.
Technical Skills:
It is really important for an employee to be proficient
regarding his/her technical expertise before getting handle on work. Technical
skills do not just pertain to IT services alone where an employee should be
sound enough in his/her particular work domain (either programming language or
operating system). It spreads across every organization (w.r.t
financial/banking services, one should be technically proficient handling
accounts; a business analyst must be technically sound in analytics and
reports, etc.)
Soft Skills:
It is very essential as every employee will have to speak to
clients/handle client calls, narrate the product description, walk clients
through the work flow, etc.
What went well?
It is an important question that should be appended to any
review process as this figures out if the goal associated with an employee is
achieved or not, status of the goal, time spent on goal, time elapsed on goal
and has the work of employee been reviewed by the manager.
What could have gone
better?
After getting a hold of what went well, the next step is to find
out how things could have gone better or how can it be made better in the
future. It is a simple process that helps employee understand what he/she is
good at and areas where improvements are needed.
Any specific needs?
Based on the review provided by the manager, the employee can be
put to training if he/she lacks technical/soft skills. If the manager feels
that an employee requires some form of additional support, he can very well
help employee through it.
..................................
Performance
Appraisal Methods
Performance
Appraisal Methods
“It is a systematic evaluation of an individual with respect to
performance on the job and individual’s potential for development.”
Definition 2: Formal
System, Reasons and Measures of future performance
“It is formal, structured system of measuring, evaluating job
related behaviors and outcomes to discover reasons of performance and how to
perform effectively in future so that employee, organization and society all
benefits.”
Meaning of Performance Appraisals
Performance Appraisals is the assessment of individual’s
performance in a systematic way. It is a developmental tool used for all round
development of the employee and the organization. The performance is measured
against such factors as job knowledge, quality and quantity of output,
initiative, leadership abilities, supervision, dependability, co-operation,
judgment, versatility and health. Assessment should be confined to past as well
as potential performance also. The second definition is more focused on
behaviors as a part of assessment because behaviors do affect job results.
Performance Appraisals and Job Analysis Relationship
|
Job
Analysis Ã
|
Performance
Standards Ã
|
Performance
Appraisals
|
|
Describe
the work and personnel requirement of a particular job.
|
Translate
job requirements into levels of acceptable or unacceptable performance
|
Describe
the job relevant strengths and weaknesses of each individual.
|
Objectives of Performance Appraisals
Use of Performance Appraisals
1. Promotions
2. Confirmations
3. Training and Development
4. Compensation reviews
5. Competency building
6. Improve communication
7. Evaluation of HR Programs
8. Feedback & Grievances
4 Goals of Performance Appraisals
|
General
Goals
|
Specific
Goals
|
|
Developmental
Use
|
Individual
needs
Performance feedback
Transfers and Placements
Strengths and Development needs
|
|
Administrative Decisions / Uses
|
Salary
Promotion
Retention / Termination
Recognition
Lay offs
Poor Performers identification
|
|
Organizational Maintenance
|
HR Planning
Training Needs
Organizational Goal achievements
Goal Identification
HR Systems Evaluation
Reinforcement of organizational needs
|
|
Documentation
|
Validation Research
For HR Decisions
Legal Requirements
|
Performance Appraisal Process
1. Objectives definition of appraisal
2. Job expectations establishment
3. Design an appraisal program
4. Appraise the performance
5. Performance Interviews
6. Use data for appropriate purposes
7. Identify opportunities variables
8. Using social processes, physical processes,
human and computer assistance
Difference
between Traditional and Modern (Systems) approach to Appraisals
|
Categories
|
Traditional
Appraisals
|
Modern,
Systems Appraisals
|
|
Guiding
Values
|
Individualistic,
Control oriented, Documentary
|
Systematic,
Developmental, Problem solving
|
|
Leadership
Styles
|
Directional,
Evaluative
|
Facilitative,
Coaching
|
|
Frequency
|
Occasional
|
Frequent
|
|
Formalities
|
High
|
Low
|
|
Rewards
|
Individualistic
|
Grouped,
Organizational
|
TECHNIQUES / METHODS OF PERFORMANCE APPRAISALS
Numerous methods have been devised to measure the quantity and
quality of performance appraisals. Each of the methods is effective for some
purposes for some organizations only. None should be dismissed or accepted as
appropriate except as they relate to the particular needs of the organization
or an employee.
Broadly all methods of appraisals can be divided into two
different categories.
·
Past Oriented Methods
·
Future Oriented Methods
Past Oriented Methods
1. Rating
Scales: Rating scales consists of several numerical scales representing
job related performance criterions such as dependability, initiative, output, attendance,
attitude etc. Each scales ranges from excellent to poor. The total numerical
scores are computed and final conclusions are derived. Advantages –
Adaptability, easy to use, low cost, every type of job can be evaluated, large
number of employees covered, no formal training required. Disadvantages –
Rater’s biases
2. Checklist: Under
this method, checklist of statements of traits of employee in the form of Yes
or No based questions is prepared. Here the rater only does the reporting or
checking and HR department does the actual evaluation. Advantages – economy,
ease of administration, limited training required, standardization.
Disadvantages – Raters biases, use of improper weighs by HR, does not allow
rater to give relative ratings
3. Forced
Choice Method: The series of statements arranged in the blocks of two or more
are given and the rater indicates which statement is true or false. The rater
is forced to make a choice. HR department does actual assessment. Advantages –
Absence of personal biases because of forced choice. Disadvantages – Statements
may be wrongly framed.
4. Forced
Distribution Method: here employees are clustered around a high
point on a rating scale. Rater is compelled to distribute the employees on all
points on the scale. It is assumed that the performance is conformed to normal
distribution. Advantages – Eliminates Disadvantages – Assumption of normal
distribution, unrealistic, errors of central tendency.
5. Critical
Incidents Method: The approach is focused on certain critical
behaviors of employee that makes all the difference in the performance.
Supervisors as and when they occur record such incidents. Advantages –
Evaluations are based on actual job behaviors, ratings are supported by
descriptions, feedback is easy, reduces recency biases, chances of subordinate
improvement are high. Disadvantages – Negative incidents can be prioritized,
forgetting incidents, overly close supervision; feedback may be too much and
may appear to be punishment.
6. Behaviorally
Anchored Rating Scales: statements of effective
and ineffective behaviors determine the points. They are said to be
behaviorally anchored. The rater is supposed to say, which behavior describes
the employee performance. Advantages – helps overcome rating errors.
Disadvantages – Suffers from distortions inherent in most rating techniques.
7. Field
Review Method: This is an appraisal done by someone outside employees’ own
department usually from corporate or HR department. Advantages – Useful for
managerial level promotions, when comparable information is needed,
Disadvantages – Outsider is generally not familiar with employees work
environment, Observation of actual behaviors not possible.
8. Performance
Tests & Observations: This is based on the test
of knowledge or skills. The tests may be written or an actual presentation of
skills. Tests must be reliable and validated to be useful. Advantage – Tests
may be apt to measure potential more than actual performance. Disadvantages –
Tests may suffer if costs of test development or administration are high.
9. Confidential
Records: Mostly used by government departments, however its application
in industry is not ruled out. Here the report is given in the form of Annual
Confidentiality Report (ACR) and may record ratings with respect to following
items; attendance, self expression, team work, leadership, initiative,
technical ability, reasoning ability, originality and resourcefulness etc. The
system is highly secretive and confidential. Feedback to the assessee is given
only in case of an adverse entry. Disadvantage is that it is highly subjective
and ratings can be manipulated because the evaluations are linked to HR actions
like promotions etc.
10. Essay
Method: In this method the rater writes down the employee description in
detail within a number of broad categories like, overall impression of
performance, promoteability of employee, existing capabilities and
qualifications of performing jobs, strengths and weaknesses and training needs
of the employee. Advantage – It is extremely useful in filing information gaps
about the employees that often occur in a better-structured checklist.
Disadvantages – It its highly dependent upon the writing skills of rater and
most of them are not good writers. They may get confused success depends on the
memory power of raters.
11. Cost Accounting
Method: Here performance is evaluated from the monetary returns yields
to his or her organization. Cost to keep employee, and benefit the organization
derives is ascertained. Hence it is more dependent upon cost and benefit
analysis.
12. Comparative
Evaluation Method (Ranking & Paired Comparisons): These
are collection of different methods that compare performance with that of other
co-workers. The usual techniques used may be ranking methods and paired
comparison method.
·
Ranking Methods: Superior
ranks his worker based on merit, from best to worst. However how best and why
best are not elaborated in this method. It is easy to administer and
explanation.
·
Paired Comparison
Methods: In this method each employee is rated with another employee in
the form of pairs. The number of comparisons may be calculated with the help of
a formula as under.
N x (N-1) / 2
Future Oriented Methods
1. Management
By Objectives: It means management by objectives and the performance is rated
against the achievement of objectives stated by the management. MBO process
goes as under.
·
Establish goals and desired outcomes for each subordinate
·
Setting performance standards
·
Comparison of actual goals with goals attained by the employee
·
Establish new goals and new strategies for goals not achieved in
previous year.
Advantage – It is more useful for managerial positions.
Disadvantages – Not applicable to all jobs, allocation of merit
pay may result in setting short-term goals rather than important and long-term
goals etc.
2. Psychological
Appraisals: These appraisals are more directed to assess employees potential
for future performance rather than the past one. It is done in the form of
in-depth interviews, psychological tests, and discussion with supervisors and
review of other evaluations. It is more focused on employees emotional,
intellectual, and motivational and other personal characteristics affecting his
performance. This approach is slow and costly and may be useful for bright
young members who may have considerable potential. However quality of these
appraisals largely depend upon the skills of psychologists who perform the
evaluation.
3. Assessment
Centers: This technique was first developed in USA and UK in 1943. An
assessment center is a central location where managers may come together to
have their participation in job related exercises evaluated by trained
observers. It is more focused on observation of behaviors across a series of
select exercises or work samples. Assessees are requested to participate in
in-basket exercises, work groups, computer simulations, role playing and other
similar activities which require same attributes for successful performance in
actual job. The characteristics assessed in assessment center can be
assertiveness, persuasive ability, communicating ability, planning and
organizational ability, self confidence, resistance to stress, energy level,
decision making, sensitivity to feelings, administrative ability, creativity and
mental alertness etc. Disadvantages – Costs of employees traveling and lodging,
psychologists, ratings strongly influenced by assessee’s inter-personal skills.
Solid performers may feel suffocated in simulated situations. Those who are not
selected for this also may get affected.
Advantages –
well-conducted assessment center can achieve better forecasts of future
performance and progress than other methods of appraisals. Also reliability,
content validity and predictive ability are said to be high in assessment
centers. The tests also make sure that the wrong people are not hired or
promoted. Finally it clearly defines the criteria for selection and promotion.
4. 360-Degree
Feedback: It is a technique which is systematic collection of performance
data on an individual group, derived from a number of stakeholders like
immediate supervisors, team members, customers, peers and self. In fact anyone
who has useful information on how an employee does a job may be one of the
appraisers. This technique is highly useful in terms of broader perspective,
greater self-development and multi-source feedback is useful. 360-degree
appraisals are useful to measure inter-personal skills, customer satisfaction
and team building skills. However on the negative side, receiving feedback from
multiple sources can be intimidating, threatening etc. Multiple raters may be
less adept at providing balanced and objective feedbac
...................................
4 Types of Employee
Performance Evaluations
Employee evaluations are a critical component of running
nearly any business — and having an effective measurement system in place helps
you get the most from your staff. Besides this, evaluations help you recognize
worker achievements, objectively compare multiple employees and identify areas
where improvement is needed. The question is, “How do you select an effective
system that fits your company’s specific needs?” To answer this question, let’s
go over four popular types of employee performance evaluations and the
advantages each offers.
1) Numerical Rating Scale
Due to its simplicity, this is one of the most widely used
systems and tends to be highly effective. It’s also popular because it allows
employers to measure employee performance on a plethora of areas such as
teamwork, communication skills and reliability. A numerical rating scale is
beneficial because a business can customize the system to rate whatever
employee traits or characteristics it deems as important. This commonly
involves rating individuals on a (1 to 5) or a (1 to 10) scale with lower
numbers being unsatisfactory and higher numbers being satisfactory. In turn,
employers can use tangible data to determine if an employee’s performance is
poor, average, good or great.
2) Objective-Based
This is another simplistic evaluation system and is a clear
cut way to track progress. In an objective-based evaluation, an employer and
employee will agree upon a specific goal for the employee to meet coupled with
a deadline. If the employee meets the objective, then it speaks highly of them
and vice versa. This is perhaps the most black and white of all systems and is
a practical way to monitor the overall success of employees.
3) 360-Degree Appraisal
If you’re looking for comprehensive feedback on an
employee’s performance to form in-depth insights, then this is the way to go. A
360-degree appraisal works by gathering feedback from multiple parties such as
managers, coworkers, customers and even vendors. The more information you
collect, the more accurate the performance review becomes, and the more the
picture comes into focus. Although this form of evaluation is somewhat
laborious and time-consuming when compared to the first two techniques, many
employers prefer it because of the unbiased data they receive and the multi-dimensional
vantage point it creates.
4) Critical Incidents
This system is defined as “A method of performance appraisal
involving identifying and describing specific events (or incidents) where the
employee did something really well or something requiring improvement.” For
example, you might record an instance of a stressful situation where an
employee out-shined and exceeded expectations. On the other hand, you might record
a serious mistake an employee made that was detrimental to productivity and
created a lot of lingering problems. For a critical incidents evaluation system
to be effective, it’s important to keep detailed records — and you may want to
implement a rating system for increased objectivity.
Understanding the concept behind different types of employee
performance evaluations allows you to choose which one, or combination, is best
for your business. In turn, you’ll be equipped to objectively measure the progress
of your employees and ultimately fine-tune your operations.
.........................................
HRM - Performance Appraisal Methods
Oct
30, 2014
·
39,359 views
·
26 Likes
“It is a systematic evaluation of an individual with respect to
performance on the job and individual’s potential for development.”
Definition 2: Formal
System, Reasons and Measures of future performance
“It is formal, structured system of measuring, evaluating job
related behaviors and outcomes to discover reasons of performance and how to
perform effectively in future so that employee, organization and society all
benefits.”
Meaning of Performance Appraisals
Performance Appraisals is the assessment of individual’s
performance in a systematic way. It is a developmental tool used for all round
development of the employee and the organization. The performance is measured
against such factors as job knowledge, quality and quantity of output,
initiative, leadership abilities, supervision, dependability, co-operation,
judgment, versatility and health. Assessment should be confined to past as well
as potential performance also. The second definition is more focused on
behaviors as a part of assessment because behaviors do affect job results.
Performance Appraisals and Job Analysis
Relationship
|
Job
Analysis Ã
|
Performance
Standards Ã
|
Performance
Appraisals
|
|
Describe
the work and personnel requirement of a particular job.
|
Translate
job requirements into levels of acceptable or unacceptable performance
|
Describe
the job relevant strengths and weaknesses of each individual.
|
Objectives of Performance Appraisals
Use of Performance
Appraisals
1. Promotions
2. Confirmations
3. Training and Development
4. Compensation reviews
5. Competency building
6. Improve communication
7. Evaluation of HR Programs
8. Feedback & Grievances
4 Goals of Performance Appraisals
|
General
Goals
|
Specific
Goals
|
|
Developmental
Use
|
Individual
needs
Performance feedback
Transfers and Placements
Strengths and Development needs
|
|
Administrative
Decisions / Uses
|
Salary
Promotion
Retention / Termination
Recognition
Lay offs
Poor Performers identification
|
|
Organizational
Maintenance
|
HR
Planning
Training Needs
Organizational Goal achievements
Goal Identification
HR Systems Evaluation
Reinforcement of organizational needs
|
|
Documentation
|
Validation
Research
For HR Decisions
Legal Requirements
|
Performance Appraisal Process
1. Objectives definition of appraisal
2. Job expectations establishment
3. Design an appraisal program
4. Appraise the performance
5. Performance Interviews
6. Use data for appropriate purposes
7. Identify opportunities variables
8. Using social processes, physical processes, human and
computer assistance
Difference
between Traditional and Modern (Systems) approach to Appraisals
|
Categories
|
Traditional
Appraisals
|
Modern,
Systems Appraisals
|
|
Guiding
Values
|
Individualistic,
Control oriented, Documentary
|
Systematic,
Developmental, Problem solving
|
|
Leadership
Styles
|
Directional,
Evaluative
|
Facilitative,
Coaching
|
|
Frequency
|
Occasional
|
Frequent
|
|
Formalities
|
High
|
Low
|
|
Rewards
|
Individualistic
|
Grouped,
Organizational
|
TECHNIQUES / METHODS OF PERFORMANCE APPRAISALS
Numerous methods have been devised to measure the quantity and
quality of performance appraisals. Each of the methods is effective for some
purposes for some organizations only. None should be dismissed or accepted as
appropriate except as they relate to the particular needs of the organization
or an employee.
Broadly all methods of appraisals can be divided into two
different categories.
·
Past
Oriented Methods
·
Future
Oriented Methods
Past Oriented Methods
1. Rating Scales: Rating
scales consists of several numerical scales representing job related
performance criterions such as dependability, initiative, output, attendance,
attitude etc. Each scales ranges from excellent to poor. The total numerical
scores are computed and final conclusions are derived. Advantages –
Adaptability, easy to use, low cost, every type of job can be evaluated, large
number of employees covered, no formal training required. Disadvantages –
Rater’s biases
2. Checklist: Under
this method, checklist of statements of traits of employee in the form of Yes
or No based questions is prepared. Here the rater only does the reporting or
checking and HR department does the actual evaluation. Advantages – economy,
ease of administration, limited training required, standardization.
Disadvantages – Raters biases, use of improper weighs by HR, does not allow
rater to give relative ratings
3. Forced Choice
Method: The series of statements arranged in the blocks of two or more
are given and the rater indicates which statement is true or false. The rater
is forced to make a choice. HR department does actual assessment. Advantages –
Absence of personal biases because of forced choice. Disadvantages – Statements
may be wrongly framed.
4. Forced
Distribution Method: here employees are clustered around a high
point on a rating scale. Rater is compelled to distribute the employees on all
points on the scale. It is assumed that the performance is conformed to normal
distribution. Advantages – Eliminates Disadvantages – Assumption of normal
distribution, unrealistic, errors of central tendency.
5. Critical
Incidents Method: The approach is focused on certain critical
behaviors of employee that makes all the difference in the performance.
Supervisors as and when they occur record such incidents. Advantages –
Evaluations are based on actual job behaviors, ratings are supported by
descriptions, feedback is easy, reduces recency biases, chances of subordinate
improvement are high. Disadvantages – Negative incidents can be prioritized,
forgetting incidents, overly close supervision; feedback may be too much and
may appear to be punishment.
6. Behaviorally
Anchored Rating Scales: statements of effective
and ineffective behaviors determine the points. They are said to be
behaviorally anchored. The rater is supposed to say, which behavior describes
the employee performance. Advantages – helps overcome rating errors.
Disadvantages – Suffers from distortions inherent in most rating techniques.
7. Field Review Method: This is
an appraisal done by someone outside employees’ own department usually from
corporate or HR department. Advantages – Useful for managerial level
promotions, when comparable information is needed, Disadvantages – Outsider is
generally not familiar with employees work environment, Observation of actual
behaviors not possible.
8. Performance
Tests & Observations: This is based on the test
of knowledge or skills. The tests may be written or an actual presentation of
skills. Tests must be reliable and validated to be useful. Advantage – Tests
may be apt to measure potential more than actual performance. Disadvantages –
Tests may suffer if costs of test development or administration are high.
9. Confidential
Records: Mostly used by government departments, however its application
in industry is not ruled out. Here the report is given in the form of Annual
Confidentiality Report (ACR) and may record ratings with respect to following
items; attendance, self expression, team work, leadership, initiative, technical
ability, reasoning ability, originality and resourcefulness etc. The system is
highly secretive and confidential. Feedback to the assessee is given only in
case of an adverse entry. Disadvantage is that it is highly subjective and
ratings can be manipulated because the evaluations are linked to HR actions
like promotions etc.
10. Essay
Method: In this method the rater writes down the employee description in
detail within a number of broad categories like, overall impression of
performance, promote ability of employee, existing capabilities and
qualifications of performing jobs, strengths and weaknesses and training needs
of the employee. Advantage – It is extremely useful in filing information gaps
about the employees that often occur in a better-structured checklist.
Disadvantages – It its highly dependent upon the writing skills of rater and
most of them are not good writers. They may get confused success depends on the
memory power of raters.
11. Cost Accounting
Method: Here performance is evaluated from the monetary returns yields
to his or her organization. Cost to keep employee, and benefit the organization
derives is ascertained. Hence it is more dependent upon cost and benefit
analysis.
12. Comparative
Evaluation Method (Ranking & Paired Comparisons):These
are collection of different methods that compare performance with that of other
co-workers. The usual techniques used may be ranking methods and paired
comparison method.
·
Ranking Methods: Superior ranks his
worker based on merit, from best to worst. However how best and why best are
not elaborated in this method. It is easy to administer and explanation.
·
Paired Comparison Methods: In this method each
employee is rated with another employee in the form of pairs. The number of
comparisons may be calculated with the help of a formula as under.
N x (N-1) / 2
Future Oriented Methods
1. Management By
Objectives: It means management by objectives and the performance is rated
against the achievement of objectives stated by the management. MBO process goes
as under.
·
Establish
goals and desired outcomes for each subordinate
·
Setting
performance standards
·
Comparison
of actual goals with goals attained by the employee
·
Establish
new goals and new strategies for goals not achieved in previous year.
Advantage – It is more useful for managerial positions.
Disadvantages – Not applicable to all jobs, allocation of merit
pay may result in setting short-term goals rather than important and long-term
goals etc.
2. Psychological
Appraisals: These appraisals are more directed to assess employees potential
for future performance rather than the past one. It is done in the form of
in-depth interviews, psychological tests, and discussion with supervisors and
review of other evaluations. It is more focused on employees emotional,
intellectual, and motivational and other personal characteristics affecting his
performance. This approach is slow and costly and may be useful for bright
young members who may have considerable potential. However quality of these
appraisals largely depend upon the skills of psychologists who perform the
evaluation.
3. Assessment
Centers: This technique was first developed in USA and UK in 1943. An
assessment center is a central location where managers may come together to
have their participation in job related exercises evaluated by trained
observers. It is more focused on observation of behaviors across a series of
select exercises or work samples. Assessees are requested to participate in
in-basket exercises, work groups, computer simulations, role playing and other
similar activities which require same attributes for successful performance in
actual job. The characteristics assessed in assessment center can be
assertiveness, persuasive ability, communicating ability, planning and
organizational ability, self confidence, resistance to stress, energy level,
decision making, sensitivity to feelings, administrative ability, creativity
and mental alertness etc. Disadvantages – Costs of employees traveling and
lodging, psychologists, ratings strongly influenced by assessee’s
inter-personal skills. Solid performers may feel suffocated in simulated
situations. Those who are not selected for this also may get affected.
Advantages – well-conducted assessment center can achieve better forecasts
of future performance and progress than other methods of appraisals. Also
reliability, content validity and predictive ability are said to be high in
assessment centers. The tests also make sure that the wrong people are not
hired or promoted. Finally it clearly defines the criteria for selection and
promotion.
4. 360-Degree
Feedback: It is a technique which is systematic collection of performance
data on an individual group, derived from a number of stakeholders like
immediate supervisors, team members, customers, peers and self. In fact anyone
who has useful information on how an employee does a job may be one of the
appraisers. This technique is highly useful in terms of broader perspective, greater
self-development and multi-source feedback is useful. 360-degree appraisals are
useful to measure inter-personal skills, customer satisfaction and team
building skills. However on the negative side, receiving feedback from multiple
sources can be intimidating, threatening etc. Multiple raters may be less adept
at providing balanced and objective feedback.
..................................
What
Are the Different Types of Performance Appraisal?
by KJ Henderson, studioD
A performance appraisal
is a formal review of an employee's work.
Related Articles
A performance appraisal, or performance review,
is a formal interaction between an employee and her manager. This is when the
performance of the employee is assessed and discussed in thorough detail, with
the manager communicating the weaknesses and strengths observed in the employee
and also identifying opportunities for the employee to develop professionally.
In most instances, a performance appraisal is completed quarterly or annually.
360-Degree Feedback
A common performance appraisal method is the
360-degree feedback. In this scenario, whoever conducts the appraisal, such as
a human resources manager, interviews an employee’s supervisor,
peers and any direct reports. This technique allows an appraiser to gain a
complete profile of the employee. In addition to gauging the
worker’s job performance and technical skill set, an appraiser
receives in-depth feedback on the employee's behavior. Measuring
areas of subjectivity, such as character and leadership skills, allows an
employer to manage an employee’s development.
Management By
Objectives
Management by objectives (MBO) is another modern
method of performance appraisal. This technique was first promoted in the 1950s
by management theorist Peter Drucker. MBO requires a manager and employee to
agree upon specific, obtainable objectives with a set deadline. For example, a
sales manager may be required to increase his revenue by 25 percent within
three months. Once this goal is set, the responsibility is on the sales manager
to direct himself towards the objective. With this technique, success or
failure is easily defined.
Ratings Scale
An alternate type of performance appraisal is
the ratings scale. This methodology requires an employer to develop an in-depth
grading system, similar to the way students in school are assessed. This scale
is then used to evaluate an employee’s success within a variety
of areas, such as technical skill set, teamwork and communication skills. There
is typically a minimum required grade an employee must receive in order for the
performance appraisal to be considered a success. Those that do not make the
grade are often put on a performance improvement plan. This method is viewed by
some management theorists as an egalitarian way of measuring individual
performance.
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