November 3, 2012

MU0016 [Performance Management and Appraisal] Set2 Q4

Q4. Write a note on traditional methods of performance appraisal.

Ans:

Performance management is a systematic approach to managing the process
according to which the performance and development of individuals and entities within the institution are actively managed to ensure that the strategy and vision of the US are achieved.

Performance management therefore entails:
i. The definition of the performance that is being managed (design);
ii. The process of performance management (implementation); and
iii. The management of the consequences of the performance (integration).

1. ESSAY APPRAISAL METHOD 
This traditional form of appraisal, also known as "Free Form method" involves a description of the performance of an employee by his superior. The description is an evaluation of the performance of any individual based on the facts and often includes examples and evidences to support the information. A major drawback of the method is the inseparability of the bias of the evaluator.


The essay method includes an evaluated report created by the appraiser, which basically includes appraising an employee's performance based on facts and evidences. Besides using the information for decisions on pay rise, promotion or termination of employees, it can also be used for developmental purposes. 

Since essay appraisals are unstructured and undefined to a great extent, lack of consistency is a major problem. The indefinite, unstructured nature of the essay appraisal makes it highly susceptible to evaluator bias. By not emphasizing on all job-related behaviors or results, an evaluator may simply stress on those that reflect conditionally or unconditionally on an employee. This does not generally represent a clear picture of the employee or the job, which brings down the reliability of the method. 

2. STRAIGHT RANKING METHOD 
This is one of the oldest and simplest techniques of performance appraisal. In this method, the appraiser ranks the employees from the best to the poorest on the basis of their overall performance. It is quite useful for a comparative evaluation.

Ranking methods compare employees with each other, resulting in an ordering of employees in relation to one another. Rather than in specific judgments about a number of job components, ranking regularly results in general evaluation of employees. Straight ranking demands an evaluator to order a group of employees from best to worst overall, or from best effective to worst effective in terms of a certain condition. The ranking process is carried out in a specific manner (for example, by selecting the best employee in a group first, then the rest, in descending order.)

3. PAIRED COMPARISON 
A better technique of comparison than the straight ranking method, this method compares each employee with all others in the group, one at a time. After all the comparisons on the basis of the overall comparisons, the employees are given the final rankings. 

This paired comparison methodology systemizes ranking and enables better comparison among individuals to be rated. Each member of the group is compared with all others in the group one at a time. Once the data based on the overall comparisons for each employee is prepared, the employees are given the final rankings. 

4. CRITICAL INCIDENTS METHODS
In this method of Performance appraisal, the evaluator rates the employee on the basis of critical events and how the employee behaved during those incidents. It includes both negative and positive points. The drawback of this method is that the supervisor has to note down the critical incidents and the employee behaviour as and when they occur.

This method describes how the employee behaved during the critical incidents with respect to performance over a period of time. These are then matched with the employee focusing on actual behavior rather than on qualities. Though this method suits well in performance review interviews, it has a drawback in that the evaluator has to make a note of the critical incidents as and when they occur. That may be an unrealistic task, and may hold-up the feedback to employees. Moreover, it makes little sense to wait for months or a year to solve a misdeed, a fault or get recognized for a good display of idea.

5. FIELD REVIEW
In this method, a senior member of the HR department or a training officer discusses and interviews the supervisors to evaluate and rate their respective subordinates. A major drawback of this method is that it is a very time consuming method. But this method helps to reduce the superiors’ personal bias.

6. CHECKLIST METHOD
The rater is given a checklist of the descriptions of the behaviour of the employees on job. The checklist contains a list of statements on the basis of which the rater describes the on the job performance of the employees.


Since every individual differs in quality and attitude, they unintentionally introduce bias in their ratings. To overcome this, essay and graphic rating measures can be combined in an organised review process. In the field review method, 'a representative of the HRM staff meets a chunk of evaluators from the supervisory units to discuss each rating, analytically notifying areas of inter-evaluator disagreement. It can be a technique to help every evaluator to observe the standards evenly and thus match the other evaluators. Although this method is very time consuming, it is very much reliable. 

7. GRAPHIC RATING SCALE
In this method, an employee’s quality and quantity of work is assessed in a graphic scale indicating different degrees of a particular trait. The factors taken into consideration include both the personal characteristics and characteristics related to the on the job performance of the employees. For example a trait like Job Knowledge may be judged on the range of average, above average, outstanding or unsatisfactory.

One of the most common methods of performance appraisal, the graphic ratings scale method requires an evaluator to measure on a scale, the angle to which an employee reflects a particular trait, behavior, or performance result. Evaluating forms comprise a number of scales, each relating to a certain job or performance-related measurement, such as job skills, responsibility or quality of work. Each scale is a band of definite points, or anchors, which range from high to low, from good to poor, from most to least effective, and so forth. Scales mainly have five to seven points, although they can have more or less. Graphic rating scales may or may not describe their scale points.

8. FORCED DISTRIBUTION
To eliminate the element of bias from the rater’s ratings, the evaluator is asked to distribute the employees in some fixed categories of ratings like on a normal distribution curve. The rater chooses the appropriate fit for the categories on his own discretion.

Forced distribution is a structure of comparative evaluation in which an evaluator rates subordinates according to specified directions. In contrast to ranking methods, forced distribution is frequently applied to several, rather than only one component of job performance.

Forced distribution is primarily used to remove rating errors such as compassion and centralisation, but the process itself can cause rating errors because it forces subtle differences between employees even where job performance is quite similar. For example, even if every employee in a unit is doing a good job, the forced distribution method suggests some of them to be placed at the bottom of a graded range. For this reason, this method is not accepted, particularly in small groups or where all the group members are equally talented.

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