Performance management and performance appraisal

The nature of performance management and performance appraisal

Features of performance management

Individual annual appraisal

Objective setting and review

Personal development plans

Career management and/or succession planning

Coaching and/or mentoring

Competence assessment

Performance related pay

Self-appraisal

Twice yearly/biannual appraisal

Continuous assessment

360-degree appraisal

Subordinate feedback

Rolling appraisal

Peer appraisal

Competence related pay

Team appraisal

Contribution related pay

Team pay

Performance appraisal

process of evaluating the performance and assessing the development needs of an employee.

More and more organizational members subject to such appraisal => geared more to managerial staff

Appraisal has certain minimum requisites or parameters:

the equivalent of at least 20 full-time non-managerial employees

minimum of one layer of professional management

evidence of departmentalization where individual departments have their own heads or supervisors

Appraisal in practice

Let individuals know what is expected of them

Improve current performance.

Provide feedback: advise or direct others on how they should do things.

Increase motivation

Identify training and development needs.

Identify potential.

Focus on career development and succession planning.

Award salary increases/performance related pay.

Evaluate the effectiveness of the selection process.

Set objectives

In reality

Staff are being continually monitored and assessed by management in an informal manner

Much dependent on individual managers

How to optimize the current management: Ensuring that managers and employees meet formally and regularly to discuss performance and potential

there is much debate and concern (disgusting/ deadly disease/ contentious)

Manager dislike (Theory X &Y) => judgemental and ultimately de-motivating approach (1957)

1990s: employees and managers offered favourable rather than unfavourable views

Training help managers to appreciate the importance of appraisal + develop coaching skills

Training address some problems:

Prejudice, for example, sex or race discrimination.

Subjectivity and bias, especially with regard to rater bias.

Insufficient knowledge of the appraisee – so appraiser position is based on position in hierarchy, rather than any real knowledge of person’s job.

The ‘halo’ and ‘horns’ effect where managers rate employees on the basis of their personal relationships rather than by objective measure of their competencies and abilities

The problem of context – the difficulty of distinguishing the work of appraisees

from the context in which they work, especially when there is a degree of comparison with other appraisees.

What might be termed the ‘paradox of roles’ in terms of the conflation of judge and counsellor (mentor) role which can lead to confusion. For example, in the shift from an evaluative to a developmental approach managers have to manage such tensions.

The paperwork – overly bureaucratic and simply about form filling.

The formality – for both appraiser and appraisee it can be an uncomfortable experience.

• Outcomes are ignored.

Everyone is ‘average or just above average’, for example, managers may find it difficult to give an employee a bad rating as they would not want to justify the criticisms in the performance review interview.

Appraising the wrong features – too much stress on easily identifiable things like timekeeping, looking busy, being pleasant and so on.

‘Recency bias’ leading to a tendency to base appraisals on the recent past, regardless of how representative it is of performance over the course of the previous year

Bach (2005):

orthodox critique: problems above could potentially be addressed by seeking to remedy the imperfections in the design and implementation of the appraisal system

notes the emergence of more critical accounts of appraisal

suggests that critical perspectives seek to highlight that it should not be assumed that clearer objectives and training of appraisers will necessarily yield satisfactory results.

important to recognize how, ‘the contested nature of appraisal, the specific managerial objectives sought, and the nature of the context in which it is applied, all have an important bearing on the impact of the appraisal process’

Holdsworth (1991: 65):

‘appraisal is a compulsively fascinating subject, full of paradoxes and love–hate relationships. And appraisal schemes are really controversial … Some schemes are popular, with overtones of evangelical fervour, while others are at least equally detested and derided as the “annual rain dance”, “the end of term report

Bratton and Gold (2003: 252):

‘making judgements about an employee’s contribution, value/worth, capability and potential has to be considered as a vital relationship with employees

developmental approaches: appraiser and appraisee aim to discuss the progress + a mutually supportive atmosphere + aim: building on employees strengths

purpose of performance appraisal has tended to oscillate between short-term performance to a more developmental

Appraisal has also been used as a disciplinary tool with poor performance

performance factors likely to be appraised:

Knowledge, ability and skill on the job

Attitude to work, expressed as enthusiasm, commitment and motivation.

Quality of work on a consistent basis and attention to detail.

Volume of productive output.

Interaction, as exemplified in communication skills and ability to relate to
others in teams.

Managing poor performance: five basic steps

3, Decide and agree on the action required

4, Providing coaching, training and guidance => Ensure changes can be made

2, Establish the reason(s) for the shortfall (avoid being crudely blaming)

5, Monitor and provide feedback (include self-management)

1, Identify and agree the problem: analysing feedback and getting agreement from the employee

Self-appraisal

being more critical

approach employees are increasingly - a case of downwards

instead of employees’ being passive recipients of their line manager’s appraisal they are increasingly involved via some form of self-assessment

e instances employees may draft their own performance reviews

the manner in which the appraisal process in a number of organizations increasingly expects employees to take greater ownership, ‘with employees assigned greater responsibility for establishing their own performance goals and for obtaining feedback on their performance

Peer appraisal: with whom an individual has been working provide the assessment of performance.

Upward appraisal: Managers are appraised by their staff

Customer appraisal:

‘one impact of these initiatives is that organizations are now increasingly setting employee performance standards based upon customer care indicators and appraising staff against these

how it can be gathered by a variety of means

Customer surveys: customer care cards, telephone surveys, interviews with customers and postal surveys

Range of surveillance techniques: For example, if a travel company had a call centre managers could listen to some of the calls between customers and the call centre operatives.

Mystery’ or ‘phantom’ shopper: Mystery shoppers observe and record their experience of the service encounter and report these findings back to the organization

Multi-rater or 360-degree feedback

Performance data is generated from a variety of sources, which can include the person to whom the individual being assessed reports, people who report to them, peers

internal and external customers

self-assessment

felt to provide a more rounded view of people, with less bias

The practicalities: the appraisal form and interview

final performance review, where an individual employee is assessed against their objectives (inputs and outputs)

allow for a review of training and development needs

appraisal forms should contain provision for

basic personal details, such as name, department, post, length of time in the job;

job title;

job description;

a detailed review of the individual’s performance against a set of job related criteria;