Results Methods of Performance Appraisals¶
Results methods of performance appraisal focus on the outcomes or results achieved by employees rather than the behaviors or traits exhibited during job performance. These methods are often preferred for their objectivity and clarity. Below are the details of some results methods of performance appraisals:
1. Management By Objectives (MBO):¶
- MBO is a systematic and organized approach that allows management to focus on achievable goals and to attain the best possible results from available resources.
- It involves setting clear, specific, and measurable objectives collaboratively by the managers and the employees, and then reviewing the employees' performance against these objectives.
- This method promotes clarity, objectivity, and constructive feedback.
2. Balanced Scorecard:¶
- The Balanced Scorecard method evaluates employee performance against a range of performance indicators across four perspectives: financial, customer, internal processes, and learning & growth.
- It provides a holistic view of the organization's performance and allows for a balanced evaluation of employee contributions across multiple dimensions.
- This method aligns employees' performance metrics with the strategic goals and values of the organization.
3. Human Resource Accounting:¶
- Human Resource Accounting involves quantifying the cost and value of employees to the organization.
- This method considers the investment made in employees and the future economic benefits that the organization can derive from them.
- By putting a financial value on human resources, organizations can better understand the return on their investment in their workforce.
4. Productivity Measures:¶
- Productivity measures focus on the ratio of output produced to the input used. In a performance appraisal context, it involves measuring the amount of work or output produced by an employee against the resources used.
- It's a straightforward method to assess an employee's efficiency and effectiveness.
- Productivity measures can be particularly useful in roles where output can be easily quantified, such as manufacturing or sales.
Each of these results methods provides a different perspective on evaluating employee performance. They shift the focus from subjective traits or behaviors to objective results and outcomes, which can provide a clearer and more accurate picture of an employee's contributions to the organization. However, these methods may overlook the qualitative aspects of job performance, and may not fully capture an employee's potential or the challenges faced in achieving results. Therefore, a combination of results methods and behavioral or trait methods might be used to achieve a more holistic appraisal of employee performance.
Errors in Performance Appraisal¶
Performance appraisals are critical in managing employee performance and development, but they are prone to various errors that can undermine their effectiveness and fairness. Here's an overview of some common errors in performance appraisals:
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Halo Effect: This occurs when an appraiser generalizes one aspect of an employee's performance or behavior and extends it to all other aspects of their performance. For instance, if an employee is particularly skilled in one area, the appraiser might give them high ratings across all areas, even where improvement is needed.
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Recency Effect: In this case, the evaluator focuses too much on the employee’s most recent behavior or performance, neglecting the overall performance throughout the entire appraisal period. This can result in an unbalanced assessment that does not accurately reflect the employee's overall contributions and abilities.
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Partiality: This happens when an evaluator favors certain employees over others based on personal liking or relationships rather than their actual performance. Such favoritism can lead to unfair evaluations, where some employees are rated more favorably than others for reasons unrelated to their work.
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Stereotyping: Stereotyping in appraisals occurs when evaluators make assumptions about an employee's capabilities and performance based on their group identity (such as gender, age, race, etc.) rather than their individual merits. This can lead to biased assessments and is unfair to the employees being evaluated.
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Leniency: A leniency error occurs when an appraiser gives undeservingly high ratings to all employees. This can be due to the evaluator's reluctance to confront poor performance or a desire to avoid conflict. It results in a lack of differentiation between high and low performers.
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Central Tendency: This is the tendency to rate all employees as average, avoiding the extremes of the rating scale. This error results in a failure to recognize truly exceptional performers or those in need of significant improvement, leading to a lack of meaningful feedback for employees.
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Personal Bias: This involves an evaluator allowing personal prejudices (such as biases about race, gender, age, religion, etc.) to influence their ratings. Personal biases can significantly distort an appraisal, leading to unfair and inaccurate assessments.
Each of these errors can have serious implications for employee morale, motivation, and development. It's important for organizations to train evaluators in recognizing and avoiding these biases to ensure fair, accurate, and effective performance appraisals.
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