Literature review of performance appraisal

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I. Contents of getting literature review of performance

appraisal
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Employee acceptance is a critical component of an effective performance appraisal system.(1)
Research in organizational behavior clearly demonstrates that employee attitudes influence
behavior,(2) and participant attitudes toward performance appraisal systems are no exception.(3)
The attitudes of system participants play a key role in both the short and long term success of a
performance appraisal system.(4) The goal of this research is to identify the characteristics of
municipal government performance appraisal systems that are associated with perceived
employee acceptance as reported by a national sample of municipal government personnel
officials. Performance appraisal systems are but one component of an overall system of human
resources management that is designed to enhance employee effectiveness. The key is the proper
design and administration of the system in order to benefit both employees and management.(5)
Performance appraisal systems are employed to serve a host of administrative and developmental
purposes from providing specific performance feedback to generating information for merit pay,
promotion, demotion and other personnel decisions.(6)
Personnel officials were the mandated respondents as stipulated by the grant that partially funded
the research. The analysis is only suggestive for the obvious reason that the direct participants in
the process, raters and ratees, are not the research subjects. Nevertheless, this effort provides
insight and information on both the structural characteristics of appraisal systems and the
perceptions of a key actor in the appraisal process.
Literature Review

Performance Appraisal System Acceptance

One of the serious weaknesses in existing performance appraisal research is a dearth of attention
to performance appraisal system acceptance. The most detailed conceptual discussion of the
variables that comprise employee acceptance is by Carroll and Schneier.(7) Ratee acceptance is
maximized when the performance measurement process is perceived to be accurate, the system is
administered fairly, the appraisal system is congruent or doesn't conflict with the employee's
personal goals and values, and when the appraisal process does not exceed the bounds of the
"psychological contract" between rater and ratee. There are a number of negative consequences if
a system is perceived to be unfair or unacceptable because employees will reject the performance
rating and the process that generated it. The consequences include a reduction in the motivation
to change behavior based upon appraisal feedback, a rejection of the validity and usefulness of
appraisal information,(8) and unwillingness to accept the validity of personnel decisions based
upon appraisal information. In terms of expectancy theory, a lack of acceptance will adversely
influence employee perceptions. That effort will lead to a designated performance level because
performance measurement is viewed as being inaccurate or unfair.
To illustrate the positive effects, Roberts found that when personnel officials perceived higher
levels of rarer and ratee performance appraisal system acceptance, a number of positive
outcomes were produced.(9) These included perceptions that the system exerted a favorable
influence on employee motivation and productivity and that acceptance enhanced the ability of
the system to reduce absenteeism and retain good employees.
Employee attitudes influence the attitudes of raters.(10) If employees are hostile and reject the
system, raters may be unwilling or unable to effectively implement performance appraisal due to
the costs attached to employee resistance.(11) Raters that lack motivation to effectively
implement the process will meet only the minimum requirements, and with performance
appraisal, the minimum is rarely sufficient. This lack of motivation will lead to rating errors,
general or ambiguous performance feedback, inadequate performance documentation, and a lack
of confidence in the utility of performance appraisal information.
==================

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 Raters 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 administration, 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 terms 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 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.

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