PERFORMANCE

APPRAISAL &
REVIEW
RASHMI.S
 PERFORMANCE
•
APPRAISAL
It is the assessment of an individual’s performance in a systematic way.

• Measured against parameters such as

• job knowledge

• quality and quantity of output

• initiative

• leadership abilities

• supervision,

• dependability,

• co-operation,

• judgment,

• versatility,

• health …..
 FORMAL DEFN’S….
• It is the systematic evaluation of the individual with
respect to his or her performance on the job and his
or her potential for development.

• Performance' appraisal is a formal structured

system of measuring and evaluating an employee’s
job related behaviors and outcomes to discover how
and why the employee is presently performing on
the job and how the employee can perform more
effectively in the future so that the employee
• Performance Mgmt is a strategic and integrated approach to delivering
sustained success to organizations by improving the performance of
people who work in them & by developing the capabilities of teams &
individual contributions.

• (Ie) It is concerned with outputs – outcomes & achievement of results &

process & capabilities required to achieve results.

• Concerned with

• 1. Planning – identify – expectations & obj – future.

• 2. Measurement of performance & Review – progress review.

• 3. Continuous development & improvement – org & individual.

• 4. Communication – internal

• 5. Stakeholders – needs & expectations.

 PERFORMANCE APPRAISAL – A
SHORT CHRONICLE
• Prior World War I - W.D. Scott – introduced rating of workers abilities in industries.

• Influenced by Taylor – introduced a comparative scale – managers & supervisors.

• Measurement – Traits essential for success in work.

• 1950’s – Evolved into the Merit rating / Performance appraisal – Performance based pay.

• Mc Gregor – attacked Merit rating – focus on future – establish realistic targets – effective ways

to achieve it.

• 1954 – Critical Incident Technique

• 1955 – Management by objectives – Peter Drucker

• Defn by John Humble – 1972- critical review & restating of Co’s strategic & tactical plans.

• 1976 – Performance Measurement – Beer & Ruh – practical experiences & challenges
 ADAPTATION OF
DEMING’S MODEL
 PERFORMANCE APPRAISAL
• It is not done in isolation. It is linked to job analysis. Job analysis –

requirements - performance standards -e basis for performance appraisal.

• Broadly, performance appraisal serves four objectives-

• (i) developmental uses,

• (ii) administrative uses/decisions,

• (iii) organizational maintenance/objectives, and

• (iv) documentation purposes

• Emphasis : Performance evaluation contributes to firm's competitive

strength. Besides encouraging high levels of performance, the evaluation

system helps identify employees with potential, reward performance

equitably and determine employee's need for training.

PERFORMANCE APPRAISAL FOR
COMPETITIVE ADVANTAGE
APPRAISAL PROCESS
• Objectives of Appraisal : individual & org . Individual – objectives-

realistic & can be long.

- Emphasis : improve performance.

• Establish job expectations : discussion with employee about

expectations of Co from him.

• Design Appraisal Program: - Formal v/s informal, whose performance to

be assessed , raters, method & process of evaluation, method of

appraisal….

• Performance review/ interview : Periodic /annual , frequency of

feedback.

• Appraisal data for appropriate purposes : High performers, low

performers, training & developments, rewards, incentives, promotions,

succession planning…

• Eg: Hilton Triniad, Carribean Islands & TATA – Star performers.

• Errors occurrence – Halo Effect.

 APPRAISAL METHODS
• Past oriented methods

• Future oriented methods

• Past oriented : 1. Rating Scales – excellent to poor ..

• 2. Checklists

• 3. Forced Choice Method: stmts about employees – tick – more / least like

employees.

• 4. Forced Distribution Method : compels raters to rate the employees on all pts of

the scale – Normal Distribution .

• 5. Critical Incident Method

• 6. Behaviourly Anchored Rating Scales : descriptive list of behaviours – effective

& ineffective behaviours of employees.

• 7. Field Review Method - HR – discussion with ratee & superior – review records

• 8. Paired Comparison ….
• Future Oriented : past performance & plan for future.

• 1. MBO : 4 steps

• - Establish goal

• - Setting performance standard for sub-ordinates

• - Expected level of attainment – Actual level. Reasons for failure .

• - Establishing new goals & strategies.

• 2. Psychological Appraisals: Assess employees past & future potential. In

depth interviews & psychological tests..

• 3. Assessment Centres: evaluating executive & supervisor cader.

• Central location where all managers come together to perform certain

exercises/ tasks evaluated by team members.

• Eg: TATA, WIPRO, INFOSYS, ICICI BANK, ING VYSYA …

• Test – selection for promotion – unhealthy competition …

 CONTD…..
• The data is analyzed in terms of 5 employee performance
parameters ;

• Quantity of output

• Quality of output

• Timeliness of output

• Presence at work

• Cooperativeness.

• Then the performance interview aka the formal review

session happens with the employees to assess, inform and
develop the employee’s personal Development Agreement –
aligned to the org & individuals development needs.
PERFORMANCE REVIEWS
 6 STEPS TO A SUCESSFUL
REVIEW
• Step 1 : Preparation : create obj for performance period .Employees know –

expected levels.

• Step 2 :Assessment: Assess performance & timely feedback- insights – avoids

confrontations during reviews.

• Step 3: Review Documents: Entire documentation – last yr review, obj set,

performance records….

• Step 4 : Appropriate Setting: Location – manager’s office – voted worst place – no

relaxation.

• Confrence room – neutral territory – best place.

• Step 5: Deliver it Clearly: simple words, clarity, no jargons , no dancing around the

issues – as gently as poosible.

• Step 6: Encouragement: conclusion – emphasise –strong pts –motivate them to

repeat it . End on positive point – faith in employees about this yr’s obj

achievement – strength .
 FINE POINTS!!!!!
• Performance Management Sequence : sequence in which the entire appraisal &
review process of an org takes place.

• Performance & Development Agreement : Agreement on the objectives &

responsibilities of individuals in discussion with their managers during formal
review sessions. Recorded on a review form.

• -Reviewing past performance with set objectives – consider plans for future.

• -Org – pre – review meeting questionnaire.

• Performance Development Plan (PDP) : Establishes priorities – key aspects for

attention, action plan for individuals & managers – formal training, coaching,
counselling, self learning, job enlargement….

• Pre – meeting documentation : forms to be completed by manager & individual

before review meeting. – Self assessment …
 PERFORMANCE REVIEWS
• Another step in the Appraisal process.

• Feedback – essential – individuals on performance – after data

assessment.

• 3 goals

• (i) to change behaviour of employees whose performance does

not meet organisational requirements or their own personal

goals.

• (ii) To maintain the behaviour of employees who perform in an

acceptable manner and

• (iii) to recognize superior performance behaviours so that they

will be continued.
• Purpose : Provide those involved with the opportunity to reflect on
past performance as a basis for making improvement plans.
Although analysis is an important part , reaching an agreement
about the future goals – important.
• Learning process.
• 5 key elements of Performance & Development Review;
• 1. Measurement: assess results against agreed targets & standards
• 2. Feedback : Info abt the person’s performance.
• 3. Positive reinforcement: emphasising strong pts & good work –
repeated in future.
• 4. Exchange of Views: free & frank exchange of views – aspirations,
future goals, training, superiors..
• 5. Agreement: mutual understanding about future plans – by both
managers & individuals – targets.
• NOT a top down feedback.
 REVIEW
•
PROCESS
Preparing for the meeting

• - Reviewer

• - Reviewee

• Self assessment

• Guidelines for the meeting

• Set Agenda

• Conduct Constructive Review Meeting

• Feedback

• Identify problems – org, individual – ways to overcome them

• Coaching / Counseling.
 PREPARING FOR THE MEETING
• Both parties – prepare for meeting.

• Reviewer – 1.how well individual performed in

meeting targets

• 2. to what extent PDP’s have been achieved

• 3. feedback to be provided

• 4. factors affecting performance – within & outside

employee’s control

• 5. points for discussion on possible actions, targets

and career path .

• Reviewee :

• Work experiences – achievements in meeting

perfomance obj. – Success with Examples.

• Examples where they went wrong

• Progress in conforming to the PDP’s.

• Aspects – improvements required – how to achieve

• Training needs – requirements for better support /

guidance.

• Futures - aspirations

• Possible career paths

• Possible obj – next review period.

 SELF
ASSESSMENT
• Self appraisal – done by the reviewee

• Gets employees to analyse & assess their own performance – basis for

discussion & action.

• NO RATINGS for Performance Related Pay (PRP) purposes - not used –

raises issues .

• Advantages:

• 1. Generates less inhibited & more positive discussion.

• 2. Involves active participation by reviewees.

• 3. Reduces defensive behaviour.

• 4. Scope – run meeting constructively – reduces top down element of

traditional performance appraisals & unilateral nature.

• Issues:

• 1. Clear targets & Standards – assess performance

• 2. Climate of mutual trust – reviewers – not take adv of honest review.

• 3. Overestimate themselves – linked to PRP.

 GUIDELINES & AGENDA SETTING
• Understand Review – done mutually – not unilateral.

• Neither party should dominate.

• Review of each key element – gone well / not –analysis.

• Point by point examination of results of obj, PDP’s of last meeting.

• Discussion & agreement on nxt period’s performance objectives &

development obj.

• Discussion & agreement on actions – avoid failure , new PDP’s formed.

• General discussion – reviewees aspirations, possible career paths .

• Conclusion – Final check & agreement on the goals & obj for nxt period.
 DURING THE MEETING
• Reviewees – most of the talking.

• Reviewers – encourage reviewees – speak freely – listen carefully.

• Allow scope for reflection & analysis.

• Ask right, open ended & probe questions delicately.

• Analyse performance, not personality, concentrate – whole period,

not isolated events.

• Recognize strengths & reinforce them.

• End meeting on high note – agreed action plans, understanding of

how progress will be achieved, better camarederie.

• Check – understood by both parties – Japanese Parotting.

FEEDBACK
• Complex process – care.

• Based on fact , not subjective judgements.

• Presented on their performance – understand their strong & weak pts – appropriate action.

• Weak pts – corrective action; Strong pts – reinforcement & bolsters confidence.

• Positive feedback – powerful motivator – Positive Stroking .

• Famous Guidelines:

• 1. Build feedback into job – provide as quickly as possible – same or within 2 days – good / bad.

• 2. Provide feedback on actual events – no hearsay / judgements.

• 3. Refer to specific behaviours: no general stmts.

• 4. Ask questions: no stmts – allow time for reflection

• 5. Get them to work things out by themselves : encourage – own conclusions.

• 6. Select key issues – restrict feedback to them; not all topics .

• 7. Focus: improvement areas.

• 8. Show Understanding : Empathize – understand circumstances – beyond employee’s control.

COACHING &
COUNSELLING
• Post review process. – often neglected.

• Coaching – person – person ,develops individual

knowledge, skill, attitudes..

• Identify person’s knowledge, skills, capabilities –learning

needs, encourage self learning, make them understand
their problems…

• Counselling: Recognize their problems, empower them &

help them manage it – no spoon feeding – specialists,
training, mentors…

• Involves: Intelligent listening, avoiding judgements,

problem defining, changing perspective – help employee,
observing behaviour, alert & flexible.
PRACTICAL CASE
STUDIES
 PIRAMYD MEGASTORE
• Retail outlet in Mumbai, offers Shopentertainment.

• Offers entire range of all products for women – apparels &

accessories.

• Motto: We believe in service & do it with pride.

• Perfomance appraisal : 360 degrees – line staff, supervisors, store

manager.

• Self assessment of all employees. – annual

• Review meeting – Argument over Performance.

• Employees – free to justify, ask job related questions, expectations &

formulation of PDP’S .

• Motivate – putting results on notice board – staff – work harder –

avoid last level – Danger Zone of Appraisal committee.

 COCA COLA
• Annual Performance appraisal
• 3 steps
• 1. Defining Job – job standards
• 2. Appraising Performance
• 3. Feedback
• Team appraisals - periodic
• Rewards for both team as well as individuals.
• Performance – team – leader & individuals goals
alignment & achievement – overall org.
 OTHER CO’S WHICH HAVE
PERFORMANCE APPRAISAL

• 1)4004 Incorporated – 150 employees

• 2) HPCL – Hindustan Petrochemical ltd. – 500
approx
• 3) Titan – 3500 approx – Jewellery.
• 4) Godrej – 1000 -1100 – Chemicals division
• 5) UTI Mutual Funds – 1300 approx
• 6) Reliance BPO - > 6000
• 7) Nicholas Piramal – brand mgmt - 350
• 1. 4004 Incorporated : Just in the books . Carrot –Stick
approach . Annual Performance Appraisal & Review – threats.

• 2. HPCL : Periodic Appraisal & informal & Formal review

sessions. Mainly used for training. Allow employees lots of

scope for introspection – strength & weakness.

• Titan, Godrej & Nicholas Piramal : Similar to that of HPCL.

Regular & Periodic reviews. Facilitates communication between

superiors & sub-ordinates.

• UTI Mutual Funds: Periodic activity – development needs.

 PRÉCIS
 Intro to Performance Appraisal – Concept , Defn’s & Chronicle.

 Performance Management – Concept & Definition.

 Performance Appraisal – 1. Adaptation of Deming’s Model.

 2. Obj, purpose, Appraisal Process & Methods

 3. Performance Appraisal for Competitive Advantage.

 Performance Review – 1. Statistics, Fine Points

 2. Concept & Process.- Guidelines , Agenda, Pre & Post review.

 3. Self Assessment

 4. Feedback

 5. Coaching & Counselling

 Practical Case Studies.

THANK YOU !!!!!