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Performance Management and Performance Appraisals

Dr. Thin Nwe OoAssociate Professor

Dept. of Management StudiesYangon University of Economics

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What is Performance?

Doing something successfully by using skills, knowledge and motivation

“Outcomes, results or accomplishments”

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Performance Management

a process to establish a shared understanding about what is to be achieved, and an approach to managing and developing people in order to achieve it

Getting better results for the organization via the measurement of individual performance

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Nature of Performance Management•Performance Management

Processes used to identify, encourage, measure, evaluate, improve, and reward employee performance Provide information to employees about their performance. Clarify organizational performance expectations. Identify the development steps that are needed to enhance

employee performance. Document performance for personnel actions. Informing and getting agreement on individual performance Facilitate them to achieve better results Provide rewards for achieving performance objectives.

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Performance Management is A Part of HRM Cycle

Recruitment & Selection

Performance Appraisal

Reward

Training and Development

Performance depends upon each of the four components and how they are coordinated

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Performance Performance Management Management

LinkageLinkage

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Types of Performance InformationTypes of Performance Information

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Performance Standards

•Performance Standards▫Expected levels of performance

Benchmarks, goals, and targets▫Characteristics of well-defined standards

Realistic Measurable Clearly understood Challenging

E.g. - Finish 20 bags per hour - Making 20 presentation with at least grade B in first semester - Innovate 3 new products in the first three months

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Performance Appraisal• “The systematic description of an

employee’s strengths and weaknesses” • The process of evaluating how well

employees perform their jobs when compared to a set of standards, and then communicating the information to employees.

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Performance Appraisal ▫Informal appraisals: ongoing basic within the

organization▫Formal appraisals: occurrence at certain intervals

throughout that person’s history of employment

Performance Appraisal is a part of Performance Measurement Process

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Uses of Performance Appraisal

Performance Appraisal

To provide rewards To provide training

To review potential

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Benefits of Performance Appraisal Individual

• Objectives can be established in relation the whole organization

• Key results and timescale can be established

• Can compare past performance and future activities against standards

• Can be known pay on the basis of performance

Organization• Suitable promotion

candidates can be identified• Areas of improvement can

be seen• Communication is improved• Basis for medium to long

term HR planning

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The Process of Performance Appraisal

•Step 1- Identification of criteria•Step 2- Appraise for a period of time•Step 3- Prepare an appraisal report by manager•Step 4- Appraisal interview•Step 5- Modify the report if necessary as a result

of interview•Step 6- Review of the assessment•Step 7- Prepare the action plan for improvement•Step 8- Implement the action plan•Step 9- Follow up the result

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Where to Appraise?

Common Performan

ce Measures

Quantity of Output

Quality of Output

Timeliness of Output

Presence at Work

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Appraisal Techniques

• Graphic Rating Scales• Check List• Essay• Behavioral Rating Scales• Management by Objectives (MBO)

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Traditional Traditional Performance Performance

Appraisal ProcessAppraisal Process

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Types of Appraisals

•Downward Appraisal•Upward Appraisal •Peer Appraisal•Self Appraisal•Customer Appraisal•Multi-source or 360 degree Appraisal

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Who Conducts Appraisals?

Supervisors rating their employees

Employees rating their superiors

Multi-source

Outside sources rating

employees

Team members rating each

other

Employees rating

themselves

Sources of Performance Appraisals

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Multi-source Appraisal

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Appraisal Interview

• Interview between Manger (may be one of the appraiser) and subordinate (appraisee)

• The purpose is to encourage collaborative problem solving and improvement planning

• Three styles of manager that can be adopted– Tell and sell– Tell and listen– Problem solving

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Appraisal Errors• Halo error: A situation in which a supervisor

generalizes from one dimension of a person’s job performance to all dimensions of performance.

• Error of central tendency: An error that occurs when a manager rates all employees average, even when their performances vary.

• Leniency error: A situation occurs when manager rates all employees in a group higher than they deserve.

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Why PA May Fail

Unclear Language

Mgr not taking PA seriously

Mgr not prepared

No on-going feedback

Mgr not honest orsincere

Ineffective discussion

Lack appraisal skills

Mgr Lacks Information

Insuff. Rewards

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Sources of Ineffective Performance Organization Policies and

Practices• Ineffective job placement• Insufficient job training• Lack of attention to employee

needs or concerns• Inadequate communication

within organization• Unclear reporting relationship

Job Concerns• Boredom job• Lack of growth or

advancement opportunities• Unsafe working conditions• Excessive workload• Lack of job skills

Personal Problems• Marital problems• Financial worries• Emotional disorders• Conflict between work

demand and family demand• Other family problems• Lack of effort

External Factors• Industry decline or extreme

competition• Conflict between ethical

standards and job demands

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Contemporary PA Concepts

Management by objectives (MBO)

360-degree feedback

Self-managed teams

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Self-Managed Teams

Characteristics• Focusing group result• Larger Span of control• More

part-time/contract workers

• More cross-functional workers

Challenges• Measuring individual

result Unfair & Hard• Quality and

commitment std. Diverse

• Measure cross-functional performance Tough

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