Performance Appraisal Refers To The Process Management

Performance appraisal has been defined as the process of identifying, evaluating and developing the work performance of employees in the organization, so that the Organizational goals and objectives are more effectively achieved, while at the same time benefiting employees in terms of recognition, receiving feedback, catering for work needs and offering career guidance (Lansbury, 1988). Performance appraisal is the formal process of observing and evaluating an employee's performance (Erdogan, 2002).

According to Angelo S. DeNisi and Robert D. Pritchard (2006) "Performance appraisal" is a discrete, formal, organizationally sanctioned event, usually not occurring more frequently than once or twice a year, which has clearly stated performance dimensions and/or criteria that are used in the evaluation process. Furthermore, it is an evaluation process, in that quantitative scores are often assigned based on the judged level of the employee's job performance on the dimensions or criteria used, and the scores are shared with the employee being evaluated.

Objectives of Performance Appraisal

Performance Appraisal can be done with following objectives in mind:

To maintain records in order to determine compensation packages, wage structure, salaries raises, etc.

To identify the strengths and weaknesses of employees to place right men on right job.

To maintain and assess the potential present in a person for further growth and development.

To provide a feedback to employees regarding their performance and relate status.

To provide a feedback to employees regarding their performance and related status.

It serves as a basis for influencing working habits of the employees.

To review and retain the promotional and other training programmers.

3.4 Advantages of Performance Appraisal

It is said that performance appraisal is an investment for the company which can be justified by following advantages:

1. Promotion: Performance Appraisal helps the supervisors to chalk out the promotion programmes for efficient employees. In this regards, inefficient workers can be dismissed or demoted in case.

2. Compensation: Performance Appraisal helps in chalking out compensation packages for employees. Merit rating is possible through performance appraisal. Performance Appraisal tries to give worth to a performance. A compensation package which includes bonus, high salary rates, extra benefits, allowances and pre-requisites are dependent on performance appraisal. The criteria should be merit rather than

seniority.

3. Employees Development: The systematic procedure of performance appraisal helps the supervisors to frame training policies and programmes. It helps to analyse strengths and weaknesses of employees so that new jobs can be designed for efficient employees. It also helps in framing future development programmes.

4. Selection Validation: Performance Appraisal helps the supervisors to understand the validity and importance of the selection procedure. The supervisors come to know the validity and thereby the strengths and weaknesses of selection procedure. Future changes in selection methods can be made in this regard.

5. Communication: For an organization, effective communication between employees and employers is very important. Through performance appraisal, communication can be sought for in the following ways:

 Through performance appraisal, the employers can understand and accept skills of subordinates.

 The subordinates can also understand and create a trust and confidence in superiors.

 It also helps in maintaining cordial and congenial labour management relationship.

 It develops the spirit of work and boosts the morale of employees.

6. Motivation: Performance appraisal serves as a motivation tool. Through evaluating performance of employees, a person's efficiency can be determined if the targets are achieved. This very well motivates a person for better job and helps him to improve his performance in the future.

Summary of the Performance Analysis System

Setting performance standards, observing and providing feedback, and conducting appraisals enables the Team Leader to achieve the best results through managing employee performance.To begin the process, the Team Leader and the employee collaborates on the development of performance standards. The Team Leader then develops a performance plan that directs the employee's efforts toward achieving specific results, to support organizational growth as well as the employee's professional growth. Discussion of goals and objectives throughout the year provides a framework to ensure that employees achieve results through One on One and mutual feedback. At the end of the rating period, the Team Leader appraises the employee's performance against existing standards, and establishes new goals together for the next rating period.As the immediate supervisor, the Team Leader plays an important role; his closest interaction with the employee occurs at this level.

There are four key elements in the appraisal system:

1. Set objectives - Decide what the Team Leader wants from the employees and agree these objectives with them.

2. Manage performance - Give employees the tools, resources and training they need to perform well.

3. Carry out the appraisal - monitor and assess the employees' performance, discuss those assessments with them and agree on future objectives.

4. Provide rewards/remedies - Consider pay awards and/or promotion based on the appraisal and decide how to tackle poor performance.

Performance Standards

How does the Team Leader decide what's acceptable and what's unacceptable performance? The answer to this question is the first step in establishing written standards.Performance expectations are the basis for appraising employee performance. Written performance standards let the Team Leader to compare the employee's performance with mutually understood expectations and minimize ambiguity in providing feedback.Having performance standards is not a new concept; standards exist whether or not they are discussed or put in writing. When the Team Leader observes an employee's performance, he usually makes a judgment about whether that performance is acceptable. Standards identify a baseline for measuring performance. From performance standards, the Team Leader can provide specific feedback describing the gap between expected and actual performance.

Key Responsibility Areas

The Team Leaders in association with the Project Manager write performance standards for each key area of responsibility on the employee's job description. The employee actively participates in its development. Standards are usually established when an assignment is made, and they are reviewed if the employee's job description is updated. The discussions of standards include the criteria for achieving satisfactory performance and the proof of performance.

Performance Measurements

Since one of the characteristics of a performance standard is that it can be measured, the Team Leader identifies how and where evidence about the employee's performance will be gathered. Specifying the performance measurements when the responsibility is assigned will help the employee keep track of his progress, as well as helping the Team Leader in the future performance discussions.

There are many effective ways to monitor and verify performance, the most common of which are:

Direct observation

Specific work results (tangible evidence that can be reviewed without the employee being present)

Reports and records, such as attendance, safety, inventory, financial records, etc. Commendations or constructive or critical comments received about the employee's work.

Observation and Feedback (One on One)

Once performance objectives and standards are established, the Team Leader observes the employees' performance and provides feedback. The Team Leader has a responsibility to recognize and reinforce strong performance by an employee, and identify and encourage improvement where it is needed. The Team Leader provides informal feedback almost every day.By observing and providing detailed feedback, the Team Leader plays a critical role in the employee's continued success and motivation to meet performance expectations.

One On One Sessions

One on One is a method of strengthening communication between the Team Leader and the employee. It helps to shape performance and increase the likelihood that the employee's results will meet expectations. One on One sessions provide the Team Leader and the employee the opportunity to discuss her progress toward meeting mutually established standards and goals. A One on One session focuses on one or two aspects of performance, rather than the total review that takes place in a performance evaluation.

Review of Literature

Kevin Murphy.R & Jeanette Cleveland .N suggested that a simpler model of the appraisal process was needed. That model, with several modifications and elaborations, became the four-component model of the appraisal process in organizations that is used to organize. The model emphasizes context as the most important issue in appraisal and treats appraisal as a goal-directed process in which the goals are shaped primarily by the organizational context in which rating occurs.

Daniel Ilgen.R & Jack Feldman.M explained that the performance appraisal process is construed as a function of 3 interacting systems: organizational context, the appraiser's information processing system, and the behavioral system of the appraisee. It is argued that aspects of each system constrain the ability of the appraisal process to produce accurate, unbiased, and reliable assessment of individual behavior and performance. The following characteristics of the appraisal process are discussed: (1) observation, reward opportunities, and systemic issues such as function and expectations within the context of the organization; (2) the appraiser's automatic attention processes, categorization and memory, and information search and recall; and (3) appraisees' automatic and controlled modes of behavior.

Roger Mayer.C & James Davis.H studied about the effect of the performance appraisal system on trust for management: A field quasi-experiment. The theoretical developments have enabled the empirical study of trust for specific referents in organizations. The authors conducted a 14-month field study of employee trust for top management. A 9-month quasi-experiment found that the implementation of a more acceptable performance appraisal system increased trust for top management. The 3 proposed factors of trustworthiness (ability, benevolence, and integrity) mediated the relationship between perceptions of the appraisal system and trust.

Jack Feldman.M discussed about the Beyond attribution theory: Cognitive processes in performance appraisal. Construes performance appraisal as the outcome of a dual-process system of evaluation and decision making whereby attention, categorization, recall, and information integration are carried out through either an automatic or a controlled process. In the automatic process, an employee's behavior is categorized without conscious monitoring unless the decisions involved are problematic; a consciously monitored categorization process would then occur. Subsequent recall of the employee is viewed to be biased by the attributes of prototypes (abstract images) representing categories to which the employee has been assigned. Dispositional and contextual factors influence the availability of categories during both assignment and recall. Although automatic and controlled processes can create accurate employee evaluations, categorization interacting with task type tends to affect subsequent employee information with halo, lenient/stringent, racial, sexual, ethnic, and personality biases. Behavior taxonomies, individual differences in cognitive structure, validation of behavior-sampling techniques, and laboratory studies of appraisal processes are presented as potential topics for research.

Jeanette Cleveland.N, Kevin Murphy.R & Richard Williams.E studied about the Multiple uses of performance appraisal: Prevalence and correlates. Performance appraisal is used in organizations for a variety of purposes. However, little empirical research has been conducted to determine (a) the extent to which performance appraisal is used for each of several purposes in industry, (b) the extent to which appraisal data may be used for multiple and possibly conflicting uses within the same organization, and (c) organizational correlates of these uses. A survey questionnaire designed to answer these questions was mailed to 243 members of Division 14 of the American Psychological Association who were employed in industry. A factor analysis of the 106 completed questionnaires indicated four general uses of information from performance appraisals. The use of performance appraisal to simultaneously make distinctions between and within individuals is common. Canonical correlation analyses indicated that organizational characteristics were significantly related to uses of performance appraisal.

Mohrman. J , Allan.M, Susan.M, Edward.E & Michael Driver.J discussed about designing performance appraisal systems: Aligning appraisals and organizational realities. The Jossey-Bass management series. It is a comprehensive guide to planning, designing, and implementing appraisal systems that are tailored to meet an organization's real needs. It shows human resource professionals and managers how to define performance, who should measure it, who should give and receive feedback and when it should be given, and how often appraisals should be made.

Using their many combined years of experience and research in fields of organizational behavior, management, and development, the authors examine and evaluate the common approaches to appraisals those oriented to the performer, the behavior, the result, or the situation and show how they can be integrated into an effective total appraisal system. They offer specific advice on implementing and evaluating a new appraisal system-including how to train appraisers to use the system and specify how to involve everyone in the process to improve the entire organization. The authors discuss how to use appraisals to determine pay, provide guidelines on using them as part of career management, work through the special problems of applying performance appraisals to professionals, and analyze the legal considerations.

Robert Dipboye.L explained about the Correlates of employee reactions to performance appraisals and appraisal systems.474 exempt employees in a research and development organization were surveyed regarding their opinions and perceptions of the appraisal process. After controlling for perceived favorability of the appraisal via multiple regression, Ss' opinions of the appraisal and appraisal system were positive to the extent they believed that (a) there was an opportunity to state their own side of the issues, (b) the factors on which they were evaluated were job relevant, and (c) objectives and plans were discussed. Contrary to predictions, reports of goal setting and discussion of plans and objectives did not moderate the relationship between perceived favorability of the appraisal and the opinions of the appraisal. (10 ref) (PsycINFO Database Record (c) 2012 APA, all rights reserved)

Robert D. Bretz Jr, George T. Milkovich & Walter Read studied about the Current State of Performance Appraisal Research and Practice: Concerns, Directions, and Implications.On the surface, it is not readily apparent how some performance appraisal research issues inform performance appraisal practice. Because performance appraisal is an applied topic, it is useful to periodically consider the current state of performance research and its relation to performance appraisal practice. This review examines the performance appraisal literature published in both academic and practitioner outlets between 1985 and 1990, briefly discusses the current state of performance appraisal practice, highlights the juxtaposition of research and practice, and suggests directions for further research.

Clive Fletcher discussed about the Performance appraisal and management: The developing research agenda .Performance appraisal has widened as a concept and as a set of practices and in the form of performance management has become part of a more strategic approach to integrating HR activities and business policies. As a result of this, the research on the subject has moved beyond the limited confines of measurement issues and accuracy of performance ratings and has begun to focus more of social and motivational aspects of appraisal. This article identifies and discusses a number of themes and trends that together make up the developing research agenda for this field. It breaks these down in terms of the nature of appraisal and the context in which it operates. The former is considered in terms of contemporary thinking on the content of appraisal (contextual performance, goal orientation and self awareness) and the process of appraisal (appraiser-appraisee interaction, and multi-source feedback). The discussion of the context of appraisal concentrates on cultural differences and the impact of new technology. In reviewing these emerging areas of research, the article seeks to explore some of the implications for appraisal practice at both organizational and individual levels.

2.Research Objectives and MethodologyObjectives of the study

1. Measuring the effectiveness of the performance appraisal system.

2. Suggest the ways and means to improve the effectiveness of the existing performance appraisal system.