Literature Review On Performance Appraisal 6o2q9

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I. Contents of getting literature review on performance appraisal ================== Performance appraisals are one of the most frequently criticized talent management practices. The criticisms range from their being an enormous waste of time to their having a destructive impact on the relationship between managers and their subordinates. Criticizing performance appraisals has a long history. For decades, the literature on talent management has pointed out the flaws in most performance management systems and in some cases recommended completely abandoning them. The problem with abandoning them is that they are vital to effective talent management. I cannot imagine a company doing a good job of managing its talent without gathering information about how well individuals perform their jobs, what their skills and knowledge are, and what their responsibilities and performance goals are for the future. These types of data are simply fundamental to the effective management of the talent of any organization (and to its overall management). A decade ago, I did a study on performance management in over fifty firms and found that every firm had a performance management system. In some cases they were functioning reasonably well. There were, of course, organizations that did not have an effective system and were saying that they expected to either redesign their system or cease doing performance appraisals. The latter is what you would expect organizations to do if they followed the advice of many of the critics of performance appraisals.

Recently, I took another look at whether organizations are doing performance appraisals. The results of the survey of one hundred relatively large U.S. corporations provide some interesting data on whether organizations are doing performance appraisals. The bottom line is that every company responded that they do have a performance management system, and only six percent said that they are considering getting rid of performance appraisals for some or all of their employees. In short, the death of performance appraisals is not occurring and is unlikely to occur. Companies reported that on average ninety-three percent of their salaried employees receive a performance appraisal, and typically they receive at least one every year. Only one company reported that they had recently stopped doing evaluations for fifty or more of their employees. The survey did find that, on the average, companies are not more satisfied with their performance management systems than they were ten years ago. However, the vast majority, about eighty-five percent, report that their system is at least moderately effective. The obvious conclusion is that companies will continue to do performance appraisals despite their shortcomings and despite the many criticisms of them that appear in the management literature. In my opinion, organizations have no choice. Instead of wasting our time debating whether to eliminate performance appraisals, we should be talking about how to make them more effective. The key is to make them part of a complete performance management system, which includes goal setting, development, compensation actions, performance and a goals-based appraisal of performance.

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III. Performance appraisal methods

1. 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.

2. 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.

3. Rating Scale 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

4. Checklist method

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 istration, limited training required, standardization. Disadvantages – Raters biases, use of improper weighs by HR, does not allow rater to give relative ratings

5.Ranking Method The ranking system requires the rater to rank his subordinates on overall performance. This consists in simply putting a man in a rank order. Under this method, the ranking of an employee in a work group is done against that of another employee. The relative position of each employee is tested in of his numerical rank. It may also be done by ranking a person on his job performance against another member of the competitive group. Advantages of Ranking Method Employees are ranked according to their performance levels. It is easier to rank the best and the worst employee. Limitations of Ranking Method The “whole man” is compared with another “whole man” in this method. In practice, it is very difficult to compare individuals possessing various individual traits. This method speaks only of the position where an

employee stands in his group. It does not test anything about how much better or how much worse an employee is when compared to another employee. When a large number of employees are working, ranking of individuals become a difficult issue. There is no systematic procedure for ranking individuals in the organization. The ranking system does not eliminate the possibility of snap judgements.

6. 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 ed by descriptions, is easy, reduces recency biases, chances of subordinate improvement are high. Disadvantages – Negative incidents can be prioritized, forgetting incidents, overly close supervision; may be too much and may appear to be punishment.

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