Performance Appraisal

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Chapter 4

• Performance Appraisal

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Objectives

• List the uses of job performance information
• Discuss the importance of criteria for
  performance appraisal
• Describe the various methods of performance
  appraisal, as well as their advantages and
  limitations
• Discuss how to conduct a legally defensible
  performance appraisal

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Why Do We Appraise Employees? (I)

• Administrative Decisions
• Organizations use job performance as the basis
  for many punishments and rewards
• Punishments, require the firing of unsatisfactory
  employees
• Rewards can include promotion and pay raises
• Using the job performance data for administrative
  decisions can be found in contracts and in laws
• Basis for particular administrative decisions,
  such as salary
• Employee Development and Feedback
• Improve and maintain their job performance and
  job skills, they need feedback from their
  supervisors
• Information that what is expected on the job and
  how well employees are meeting those expectations

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Why Do We Appraise Employees? (II)

• Employees need to know when they are performing
  well so that they will continue to do so or just
  change what they are doing
• Feedback can also be helpful to enhance their
  skills to move up to higher positions
• Reducing some of the anxiety and defensiveness
  employees might experience when being evaluated
  for raises and promotions
• Criteria for Research
• Directed toward designing better equipment,
  hiring more skilled people, motivating employees
  and training employees
• Involved comparing employee performance before
  and after the implementation of a new program
  designed to enhance
• Better job performance by the trained group would
  serve as good evidence for the effectiveness of
  the training program

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Performance Criteria (I)

• Characteristics of Criteria
• Actual VS Theoretical Criteria
• The theoretical criterion is the definition of
  what good performance is rather than how its
  measured
• The theoretical criterion is a theatrical
  construct
• The actual criterion is assessed or operational
  zed
• The correspondence between the theoretical
  criterion and the actual criterion is quite close
• The theoretical criterion of producing great
  works of art is matched to the actual criterion
  of asking art experts for an opinion about the
  persons work
• Contamination, Deficiency and Relevance
• Actual criteria are intended to asses the
  underlying theoretical criteria of interest
• Provide only a rough estimate of the theoretical
  criterion it is supposed to assess

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Performance Criteria (II)

• Criterion contamination
• Reflects something other than what it was
  designed to measure
• Biases are common when peoples judgment and
  opinions are used the actual criterion
• Unreliability in the actual criterion refers to
  errors in measurement that occur any time we try
  to assess something
• Reflected in the inconsistency in measurement
  over time
• Actual performance criterion measures will have
  less than perfect reliabilities
• Criterion deficiency
• The actual criterion does not adequately cover
  the entire theoretical criterion
• Actual criterion is an incomplete representation
  of what we trying to assess
• Criterion relevance
• Construct validity

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Performance Criteria (III)

• The closer the correspondence between the actual
  criterion and the theoretical criterion, the
  greater relevance of the actual criterion
• Relevance concerns the inferences and
  interpretations made about the meaning of the
  measurements of performance
• Figure 4.1
• Level of specificity
• Job performance criteria can be developed for
  individual tasks of for entire jobs
• For developing am employee's skills, it is better
  to focus at the individual task level so that
  feedback can be specific
• For administrative purposes, overall job
  performance might be of more concern
• The particular methods used to assess performance
  should be based on the purpose of the assessment
  information

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Performance Criteria (III)

• Criterion Complexity
• Job performance even on a single task can usually
  be assessed along a quality dimension and a
  quantity dimension
• Assessment can be at the level of specificity of
  a single task or at the level of entire job
• In gymnastics, quality is the criterion used
• Gymnasts performance along a quality dimension
  and the person with the highest score wins
• The criterion is concerned with quality-jumping
  farthest, jumping highest, running faster or
  throwing farthest
• In the composite criterion approach, individual
  criteria are combined into a single score
• Comparing individual employee performance
• The multidimensional approach does not combine
  the individual criterion measures
• Preferred when feedback is given to employees

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Performance Criteria (IV)

• Dynamic criteria
• Considered constant or state standards by which
  employee performance can be judged
• The best performer on the job at one point in
  time will not be best at another point in time
• The performance would not be the same throughout
  the entire time period being studied
• Variability of performance over time is referred
  to as the dynamic criterion
• The performance was very consistent over short
  periods of time (week) but was not very
  consistent over long periods of time (month)

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Methods for Assessing Job Performance (I)

• Management by Objectives (MBO)
• Involves a mutual agreement between employees and
  managers on goals to be achieved in a given time
  period
• The emphasis is on what employees do rather than
  on what their supervisors think of them or
  perceive their behaviors to be
• MBO actively involves employees in their own
  evaluations
• MBO consists of two phases Goal setting and
  performance review

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Methods for Assessing Job Performance (II)

• In goal setting
• Employees meet individually with supervisors to
  determine the goals for which they will strive in
  the time before next appraisal
• The goals must be realistic, specific and as
  objective as possible
• Performance review
• Employees and supervisors discuss the extent to
  which the goals were met
• The performance appraisal is based on job
  results, not on characteristics
• MBO is not useful for jobs that cannot be
  quantified

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Methods for Assessing Job Performance (III)

• Objective measures of job performance
• Organization keep track of employee behaviors and
  results of behavior
• Record number of absences, accidents, incidents
  and latenesses for each employee
• Productivity data must be collected if an
  organization has an incentive system
• The amount of work produced by an individual
• Attendance-number of times absent and number of
  times late for work
• Accidents include both automotive and
  nonautomotive
• Incident are number of times the individual is
  involved in a work incident that is considered
  important for the particular job

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Methods for Assessing Job Performance (IV)

• The attendance measures are applicable to the
  majority of jobs because most jobs have scheduled
  work hours
• Assess job performance has several advantages
• Interpret the meaning of objective measures in
  relation to job performance criteria
• The quantitative nature of objective measures
  makes it easy to compare the job performance of
  different individuals in the same job
• Tied directly to organizational objectives
• Special performance appraisal systems do not have
  to be initiated
• Performance measures also have several
  limitations
• Do not involve countable output, productivity is
  not a feasible measure of performance
• Data can be contaminated and inaccurate
• Distort records by omitting bad or good incidents
  for individuals whom they wish to help or hurt

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Methods for Assessing Job Performance (V)

• Deficient as indicators of job performance
  criteria
• Tend to focus on specific behaviors, may ignore
  equally important parts
• Measures of productivity focus on work quantity
  rather than on quality
• Not necessarily under the control of the
  individual being assessed
• A person who is assaulted at work may have done
  nothing wrong and may have been unable to avoid
  the incident
• Subjective measures of job performance
• The most frequently used means of assessing the
  job performance of employees
• Graphic Rating Form
• Used to assess individuals on several dimensions
  of performance
• Focuses on characteristics or traits of the
  person or the persons performance
• Consists of a multipoint scale and several
  dimensions

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Methods for Assessing Job Performance (VI)

• From low to high and usually contains from 4 to 7
  values
• From poor to outstanding, with adequate in the
  middle
• Includes attendance and work quality
• Behavior-Focused Rating Forms
• Concentrate on specific instances of behavior
  that person has done or could be expected to do
• Behaviorally Anchored Rating Scale (BARS)
• The response choices are defined in behavioral
  terms
• Designed to assess performance on the dimension
  of Organizational Skills in the Classroom
• The behaviors are ordered from bottom to top on
  the scale along the continuum of performance
  effectiveness
• BARS uses response choices that represent
  behaviors and the graphic rating form asks for a
  rating of how well the person performs along the
  dimension in question

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Methods for Assessing Job Performance (VII)

• The Mixed Standard Scale (MSS)
• Provides the rater with a list of behaviors that
  vary in their effectiveness
• The ratee is better than the statement
• The statement fits the ratee
• The ratee is worse than the statement
• Various dimensions are presented in a random
  order
• The Behavior Observation Scale (BOS)
• Contains items that are based on critical
  incidents, making it somewhat like a mixed
  standard scale
• Different from the MSS in that the raters
  indicate frequency rather than comparisons of
  employee behavior
• Development of Behavior-Focused Forms
• Focuses on specific behavior, a form must be
  developed for a particular job or family of jobs
• Step 1 Perform job analysis to define job
  dimensions

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Methods for Assessing Job Performance (VIII)

• Step 2 Develop descriptions of effective and
  ineffective job performance from critical
  incidents
• Step 3 Have knowledgeable judges place
  descriptions into job dimensions
• Step 4 Have knowledgeable judges rate the
  effectiveness of the descriptions
• Cognitive Processes Underlying Ratings
• Require an understanding of the cognitive
  processes that affect rating behavior
• How peoples views of job performance influence
  their evaluation of an employee
• 4 cognitive variables that can influence
  evaluations of employee performance

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Methods for Assessing Job Performance (IX)

• Category structures
• The managers use in evaluating their employees
  can affect their assessments
• The information he or she recalls about that
  worker will be biased toward that category
• A typical team player is expected to behave
  rather than in terms of how that employee
  actually behaves
• Beliefs
• Performance appraisals involves raters beliefs
  about human nature
• Lead raters to make evaluations in terms of how
  they view people in general rather than in terms
  of a specific workers characteristics and
  behaviors

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Methods for Assessing Job Performance (X)

• Interpersonal affect
• Interpersonal affect refers to one persons
  feelings or emotions toward another person
• Raters who have positive emotions or affect
  toward the persons
• Interpersonal affect may not influence ratings in
  all situations
• Attribution
• Derives from social psychology research on the
  way we form impressions of other people
• The rater mentally attributes or assigns reasons
  to the workers behavior
• The poor performance of workers they do like may
  be attributed to external factors
• The attribution error can be reduced by having
  supervisors spend time performing the job they
  are evaluating

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Methods for Assessing Job Performance (XI)

• Models of the Rating Process
• Competing models of the cognitive processes that
  influence ratings of performance
• Observing performance
• Strong information about performance
• Retrieving information about performance from
  memory
• Translating retrieved information into ratings
• Use the schemata to help interpret and organize
  their experiences
• Sterotype
• Belief about characteristics of the members of a
  group
• Prototye
• Model of some characteristic or type of person

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Methods for Assessing Job Performance (XII)

• Schemata might influence all 4 steps in the
  evaluation process
• Affect the behaviors that a supervisor chooses to
  observe
• Behaviors are organized
• Stored in memory
• How they are retrieved
• How they are used to decide on ratings
• Content of Subordinate Effectiveness
• Understand the schemata of people who appraise
  performance
• Designed to effectively utilize the schemata of
  supervisors
• Borman (1987) reduced the 189 items to 6
  meaningful dimension
• Working hard
• Being responsible
• Being organized
• Knowing the technical parts of the job
• Being in control of subordinates
• Displaying concern for subordinates

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Methods for Assessing Job Performance (XIII)

• Werner (1994) conducted a study that experienced
  supervisors to rate the performance of
  secretaries as described in a series of incidents
• Attendance
• Work accuracy
• Job knowledge
• Work quantity
• Rater Bias and Error
• Halo Errors
• Occurs when a rater gives an individual the same
  rating across all rating dimensions
• For example, a person is rated as being
  outstanding in one area, he or she is rated
  outstanding in all areas, even through he or she
  may be only average or even poor in some areas
• Occurs within the rating forms of individuals as
  opposed to across forms of different individuals

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Methods for Assessing Job Performance (XIV)

• The halo patterns might accurately indicate that
  dimensions of actual performance are related
• The True halo means that an employee performs at
  the same level on all dimensions
• The raters may be better able to provide
  information about global performance than about
  dimensions of performance
• Distributional Errors
• Tends to rate everyone the same
• Leniency errors-occur when the rater rates
  everyone at the favorable end of the performance
  scale
• Severity errors-occur when the rater rates
  everyone at the unfavorable end of the
  performance scale
• Central tendency errors-occur when a rater rates
  everyone in the middle of the performance scale
• Control of Rater Bias and Error
• Error-Resistant Forms to Assess Performance
• Raters will able to make more accurate ratings
  that they focus on specific rather than on traits
• Behaviors are more concrete than traits and so
  rating them requires less idiosyncratic judgment

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Methods for Assessing Job Performance (XV)

• Rater Training to Reduce Errors
• Familiarize raters with rater errors and to teach
  them to avoid these rating patterns
• The raters might reduce the number of halo and
  leniency patterns in their ratings
• Training raters to avoid the same ratings across
  either dimensions or people
• Raters who exhibited less halo in their ratings
  might have given too much weight to
  inconsequential negative events
• Training procedures teach raters how to observe
  performance-relevant behavior and how to make
  judgments based on those observations
• Frame of reference training
• Attempts to provide a common understanding of the
  rating task
• Raters are given specific examples that represent
  various levels of performance for each dimension
  to be rated
• Factors that Influence Job Performance Ratings

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Methods for Assessing Job Performance (XVI)

• Can be influenced by supervisor expectations
  about performance independent of liking
• People are likely to forget instances of behavior
  that do not fit their view of the person they are
  evaluating
• Produce biased ratings when performance changes
  over time
• The mood of rater at the time of appraisal can
  affect ratings
• 360-Degree Feedback
• Use of multiple perspectives is becoming standard
  practice in the evaluation(Feedback) of managers
  and others
• Ratings by peers, self and subordinates can be a
  useful complement to supervisor ratings
• The manager completes a rating of his or her own
  performance
• Provide different perspectives on a persons
  performance
• Biases of individuals can be reduced
• Increased trust and better attitudes about the
  appraisal system on the part of those being
  evaluated

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How to improve performance appraisals (I)

• Biased is no reason to abandon hope of achieving
  more objective evaluations
• Providing training and feedback to raters and
  allowing subordinates to participate can also
  decrease errors, increase accuracy and promote
  satisfaction with the evaluation process
• Training
• Creating an awareness that abilities and skills
  are usually distributed in accordance with the
  normal curve
• Developing the ability to define objective
  criteria for workers can be compared
• Reduce errors in performance appraisal,
  particularly leniency and halo
• The more actively the raters are involved in the
  training process, the greater the positive effects

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How to improve performance appraisals (II)

• Providing feedback to raters
• Included information about how each managers
  ratings differed from the ratings given by other
  managers
• Reduced the leniency error
• Subordinate participation
• Allowing employees to participate in the
  evaluation of their own job performance
• Employee participation led to a significant
  improvement in employee trust in management
• Enhanced perception of the accuracy of the
  performance evaluation system
• Employee participation also led to a heightened
  belief in the fairness
• Usefulness of the appraisal process
• Increased motivation to improve job performance

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The postappraisal interview (I)

• Performance appraisal programs are to supply
  information to management for personnel decisions
• Diagnose strengths and weaknesses of employees
• Provide them with the means for self-improvement
• Job performance ratings and the recommendations
  of the appraisers must be communicated to the
  employees
• Offering feedback
• During a postapprasial interview between worker
  and supervisor
• Negative feedback will make employees angry and
  lead them to reject any criticism or suggestions

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The postappraisal interview (II)

• Employees may attempt to shift the blame for
  alleged deficiencies in job performance
• The personal interview with a supervisor was
  considered more desirable by the employee
• More effective in improving job performance
• Reaction to criticism
• Some workers will act to exaggerate their faults
  as an imagined means of revenge
• Criticism can lead to reduced motivation and job
  performance
• Possess the insight and skill to diagnose the
  reasons for a workers unsatisfactory job
  performance and to prescribe a program for
  improvement
• Employee motivation to change job behavior and to
  persist in that behavior could be enhanced

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The postappraisal interview (III)

• Improving postappraisal interview
• Can be structured to fulfill the proposes for
  which they are intended
• Employees follow their supervisors suggestions
  about improving job performance under the
  following conditions
• Employees should be allowed to participate
  actively in the appraisal process
• The postappraisal interviewer should adopt a
  positive, constructive and supportive attitude
• The interviewer should focus on specific ob
  problems rather than on the employees personal
  characteristics

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The postappraisal interview (IV)

• The employee and the supervisor should establish
  jointly specific goals to be achieved in the
  period before the nest appraisal
• The employee should be given the opportunity to
  question, challenge and rebut the evaluation
  without fear of retribution
• Discussions of changes in salary and rank should
  be linked directly to the performance appraisal
  criteria

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The Impact of Technology on Performance Appraisal

• Technology is having an impact on performance
  appraisal
• Monitoring of objective productivity and
  performance management systems
• Complete their job tasks are also capable of
  tracking productivity and data are routinely
  collected in many organizations
• Easy analysis of performance across millions of
  employee-customer transaction
• Built-in feature of the task software employees
  use to do their jobs each day
• Help managers clarify goals and expectations,
  provide coaching and feedback and evaluate
  performance
• Web-based approaches, 360-degree feedback systems
  are becoming increasingly popular

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Legal Issues in Performance Appraisal (I)

• 6 points of a legally defensible performance
  appraisal system
• Perform job analysis to define dimensions of
  performance
• Develop rating form to assess dimensions from
  prior point
• Train raters in how to assess performance
• Have higher management review ratings and allow
  employees to appeal their evaluation
• Documents performance and maintain detailed
  records
• Provide assistance and counseling to
  poor-performance employees prior to actions
  against them

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Legal Issues in Performance Appraisal (II)

• Werner and Bolino (1997) analyzed the outcomes of
  performance appraisals
• Performance appraisal systems that were based on
  a job analysis
• Gave written instructions to raters
• Offered employees the opportunity to have input
• Used multiple rates were far less likely to
  result in an organizations losing the case

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Future Issues and Challenges

• Improving performance appraisal systems
  represents a major challenge to the I/O field
• Objective measures are often not adequately
  representing the entire scope of peoples job
  performance
• Subjective measures suffer from contamination as
  a result of rating biases and errors of the
  supervisors who assess performance
• Training that focuses on how to observe good job
  performance and how to transform those
• Computerization has been expanding whats
  feasible in performance appraisal
• Challenge for practicing I/O psychologists is to
  convince organization
• To be challenged in court by an employee who
  believes that he or she has been unfairly
  evaluated
• More effective in meeting its various objective
• Apply performance appraisal systems across
  countries where customs and values differ

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Chapter 4

• -THE END-