CHAPTER 6

PERFORMANCE APPRAISAL

I. Overview of task performance

appraisal
II. Task performance methods
I. Overview of task performance appraisal

1. Definition
2. Appraisal objectives
3. Basis components of task performance appraisal
system
4. Requirements and common mistakes
5. Procedures to build up a task performance appraisal
program
1. Definition
• Performance appraisal
Evaluating systematically and officially an employee’s
current and/or past performance relative to his or her
performance standards.
• Performance management
The process employers use to make sure employees
are working toward organizational goals.
2. Performance appraisal objectives

- To improve effective performance of employees

- Appraisals help employer to make decisions on HR
planning, recruitments and training needs.
- Appraisals help in planning for correcting deficiencies
and reinforce things done correctly.
- Appraisals, in identifying employee strengths and
weaknesses, are useful for career planning
- Appraisals affect the employer’s salary raise decisions.
3. Basic components of performance appraisal
system
- Performance standards
- Measurements of performance according to
performance standard indicators.
- Feedback to employees and management unit
 The appraisal process
1
Establish performance standards with employees

2
Communicate expectations and set goals

3
Measure actual performance

4
Compare actual performance with standards

5
Discuss the appraisal with the employee

6
if necessary, initiate corrective action
 1. Establish performance
standards

derived from company’s strategic goals

based on job analysis and job description

2. Communicate
expectations

goals must be articulated from supervisor to employee

and from employee to supervisor
 3. measure actual
performance

• measurement of performance using information from:

personal observation oral reports
written reports statistical reports

4. compare performance
with standards

explanation of different levels of performance and their

degree of acceptability against the performance standard
 5. discuss appraisal
with employee

 feedback employees receive has strong impact

on self-esteem and subsequent performance

6. initiate
corrective action

• immediate action deals with symptoms

• basic corrective action deals with causes
4. Appraisal requirements and common mistakes
a. Appraisal requirements
• Appreciate: Appraisal system must be match management
objectives.
• Sensitive: Appraisal system can be classified results.
• Believable: Appraisal system can be consistent – for a certain
employee, the appraisal results of different independent
appraisers must be basically the same.
• Reasonable: Appraisal system must be accepted and supported
by organizational members.
• Practical: Appraisal system must be simple, understandable, and
applicable.
4. Appraisal requirements and common mistakes
b. Common mistakes
• Bias: The evaluator make this mistake when they
like/dislike one people than the others.
• egalitarianism: The evaluator are afraid to face
with reality. They do not want to offend anyone, so
they evaluate everyone almost the same.
• Being too positive or negative: The evaluator are
too strict or easy in evaluation.
• Affected by the most recent event: The evaluator
are affected by the most recent behavior of labors.
5. Establish job performance program
a. Select and design performance method
Depend on management objectives
b. Select evaluator
Direct employee manager, subordinate, colleagues, customers,
employee themselves
c. Define appraisal cycle
One year, six months, project
d. Training for evaluators
Objective: Help evaluators understand and consistently evaluate
Training forms: Training workshop; guided documents
e. Appraisal interview
Objective: Providing information on job performance, future potential
and solutions for job performance improvement
 II. Job performance appraisal methods

• Scale of values method

• Appraisal list method
• Recording important events
• Behavior based scale
• Comparative
• Report method
• Appraisal by objective
 1. Scale of values method

• The result of job performance appraisal is

recorded by scale of values that classified by
different levels (good, relative good, average,
below average, not good)
• Indicators selected to evaluate:
o Indicators related to job
o Indicators related to individuals performing the
job
1. Scale of values method (continued)
Indicator Good Relative Average Below Not
(5 points) good (3 points) average good
(4 points) (2 points) (1 point)
Quantity of tasks
Quality of tasks
Confidence
Initiative
Cooperative
Adaptive
Perspective
1. Scale of values method (continued)

Indicator point Explanation

High accepted products, more products than

Task 5
standard quantity
performance
Achieve standard quantity, sometimes achieve
4
higher than standard quantity
(evaluated by
3 Achieve standard quantity
number of
accepted
products, 2 Nearly achieve standard quantity
labor
productivity) 1 Under standard quantity
 1. Scale of values method (continued)

• Advantages:
o Easy to understand, simple, easy to use
o Easy to compare results
• Disadvantages:
o When design scale of value for all jobs, job
characteristics may be ignored
o Affected by objective mistakes
o Some indicators may not be included
 2. Appraisal list method
• Design a list of questions that describes behavior, attitude
that may happen in job performance. The evaluator will
mark on appropriate questions
• E.g.,
o ……..Cooperate with others
o ……..keep work place more clean
o …start, finish task on time
o …….. Unwilling to work overtime
• Advantages:
o Avoid egalitarianism or too easy
o Appraisal results may be quantified
• Disadvantages
o Have to design for different jobs
3. Record important events
• The evaluator records effective and ineffective behaviors of employees
by job elements

1. Safety control

Positive behavior Negative behavior

12/10. stop one fire on time 3/11. smoke at fire restricted area

• Advantages:
o Easy to discuss with employee about advantages and disadvantages
o Reduce objective mistakes
• Disadvantages
o Take time
o Can not fully record
o Employee fell uncomfortable
 4. Behavior based scale
Combination of scale of values and recording important event methods
Relationship with customers of service worker

Help customers when necessary

Excellent 7

Good 6 Can self control before when facing to dislike events

Relative Careful consider if he/she continues to serve drunk customers but

5
good companied by someone
Stop serving drink to drunk customer but alone
Average 4

Under Chatting with customer when he/she is alone

3
average
Examine thoroughly young customers at first coming
Bad 2

Clean up customer's drinks (regardless of they are run out or not)

Too bad 1
with impolite notice or without notice
4. Behavior based scale (continued)
• Advantages
o Less bias as compared with others
• Disadvantages:
o Take time and costly
o Easy to ignore job characteristics
o Difficult to define the actual behaviors and those
describe in based scale.
5. Comparative method
• Ranking: The staffs within a group are ranked by order
from highest to lowest.
• Required ratio method:
The evaluator classifies staffs in a group into different
small groups by certain portions.
• Grading method:
• The evaluator gives total grade to each staff within a
group.
• Pair comparison:
The evaluator compares each staff to all others remaining
by pair. The evaluation of each staff is determined by
numbers of times that he/she are evaluated as better than
others.
• Advantages:
o Simple, understandable, and realizable
o Can use to make decisions on salary, rewards,
and promotion
• Disadvantages:
o Subjective
o Feedback is limited
o Do not encourage cooperation, even creating
discord
6. Report method
• The evaluator write a report on actual job
performance that clearly define strengths,
weakness, potentials of staff
• Advantages:
• Provide useful feedback
• Disadvantages:
o Difficult to use to make HR decisions.
o The accurate of evaluation depends very much
on writing ability of the evaluator.
7. MBO
• The manager of each unit/department and each
department staff define job performance objective
for next period.
• The manager uses defined objective to evaluate
the staff and provides him feedback.
• Advantages
Encourage motivation development of staff,
stimulate agreement
• Disadvantages:
Difficult to define appropriate objectives.