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Evaluating Employee Performance

This guide emphasizes the importance of evaluating employee performance for both organizations and employees. It covers effective and legal appraisal systems, the performance appraisal process, and selecting the best methods to achieve appraisal goals. The guide includes steps, considerations, and various performance dimensions to enhance the evaluation process.

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Evaluating Employee Performance

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  1. Evaluating Employee Performance Guide for SHP 1313 students at UTM, Malaysia Prepared by : SitiRokiahSiwok , srsiwok@gmail.com

  2. How important ?

  3. The importance of evaluating employee performance • It is crucial to the organization to see if: • Predictors of job performance are indeed reliable. • The employee training programs are effective. • Other organizational programs or changes are effective.

  4. The importance of evaluating employee performance • It is important to the employee for: • Career advancement • Pay increase • Promotion • Feedback to improve performance and recognize weakness. • Providing information to achieve work goals.

  5. Effective and Legal Performance Appraisal Systems: • Are job-related and based on a job analysis • Are properly administered • Formal • Standardized • Not too complicated • Provide specific feedback • Focus on behaviors rather than traits • Ratings are documented • Use appropriate raters • raters are trained • all relevant raters are used • Raters used must be relevant and qualified

  6. The Performance Appraisal Process • Step 1: Create a task force which consist of people from all levels in the organization. • Step 2: Determine the Reason/s for evaluating employee performance. • Step 3: Identify environmental and cultural variables that could affect the system • Step 4: Determine who will evaluate performance • Step 5: Select the best method to accomplish goals

  7. The Performance Appraisal Process • Step 6: Train raters • Step 7 : Observe and document performance • Step 8 : Evaluate performance • Step 9: Communicate appraisal results to employees • Step 10 : Make personnel decisions

  8. Step 1: Create a task force

  9. Step 2: Determine the reason/s • Different appraisal techniques are appropriate/good for different purpose. • Example: • Forced-choice rating scale is excellent for determining compensation but terrible for training purposes, • or 360-degree feedback is excellent for improving employee performance but inappropriate for use to determine salary increase.

  10. Step 2: Determine reason/s • Most systems have no goal • Thus most appraisal systems are not successful ( Coens and Jenkins, 2002) • Most common reasons for performance appraisal are for employees feedback and training, to determine salary increase, making promotion decisions, making termination decisions and conducting personnel research

  11. Reasons for the Appraisal: • Feedback and training (65%) • Personnel decisions • Raises (86%) • Promotions (45%) • Termination decisions (30%) • Personnel Research • Legal or certification reasons

  12. Step 3: Identify environmental and cultural variables • Look into the organization to see what is going on: • Supervisors overworked? • Any funding? • Are employees cohesive or otherwise?

  13. Step 4: Determine who will evaluate performance

  14. Is evaluation solely by supervisors accurate?

  15. 360º Feedback or multi-source Feedback • Upper management • Direct supervisor • Peers • Subordinates • Support staff • Customers/the public • Vendors • Self

  16. 360º Feedback or multi-source Feedback • Suggestions • 4-10 raters • 15 minutes to complete • Provide feedback within 6 weeks of evaluation

  17. Agreement Among RatersConway and Huffcutt (1997) Meta-Analysis

  18. Step 5: Select the Best Method to Accomplish Goals • The next step is to select the performance criteria and the best appraisal methods. • Criteria are ways of describing employee success. Examples of criteria are attendance and quality of work. • Methods of measuring the criteria must also be created.

  19. Three important decisions to be made • Appraisal dimensions • Need to be weighted? • How? Ranking? Rating? Or subjective?

  20. Appraisal Dimensions: What will be the focus? • Trait-focused • Competency- focused • Task-focused • Goal-focused • Contextual Performance

  21. Trait-focused Performance Dimensions • Concentrates on employee attributes • Honesty • Courtesy • Responsibility • Dependability • Cooperation

  22. Competency -Focused Performance Dimensions Concentrates on the employees’ KSAOs such as : • Report writing skills • Driving skills • Public speaking skills • Knowledge of the law • Decision-making skills • Physical ability skills

  23. Task-focused Performance Dimensions • Crime prevention • Arrest procedures • Court testimony • Use of vehicle • Radio procedures • Following rules and regulations • NOTE: Organised according to similarity of tasks • A task-focused dimension includes several competencies.

  24. Goal-focused Performance Dimensions (Results) • Prevent crimes from occurring • Finish shift without personal injury • Have arrests and citations stand up in court • Minimise citizens’ complaints • Ensure public safety

  25. Contextual Performance • Contextual performance is the performance of an employee within the context of the organization. • Includes efforts by the employee to get along with peers and to do “more” than in the JD, thus promoting good prosocial organizational behaviours. • Gaining grounds

  26. Need to be weighted? • Should one dimension considered more important than the others? • Depending on the organization ( and the trade it does). The impact of one dimension has to be weighted against the others within the context of the organization. • Differential weighting has its advantages, but many organizations weigh all performance dimensions equally; easier to compute and easier to explain to employees.

  27. Performance Appraisal : How? • Employee Comparisons • Rank order • Paired comparison • Forced distribution • Objective measures • Quantity • Quality of work • Attendance • Safety • Subjective Ratings

  28. Employee Comparison :Rank Order • Employees are rank by their performance for each dimension. • The rank are then averaged across each dimension to produce an overall rank

  29. Rank Order Method: Example Easy to use when the number of employees is small

  30. Employee Comparison: Paired Comparison • To choose the better of a given pair of employees. • Advantages and disadvantages

  31. Employee Comparison: Forced Distribution • Predetermined percentage of employees are placed in five categories

  32. Employee Comparison: Forced Distribution • Also called “rank and yank” method • Easier to use compared to the other two methods. • A favourite method to some CEO • Harsh, but seem to be able to increase productivity ( for the first few years of implementation) • Employees consider the least fair method • Assumption: normal distribution of employee performance.

  33. Employee Comparison: Forced Distribution

  34. Objective Measures • Quantity of work • Quality of work • Attendance • Absenteeism • Tardiness • Tenure • Safety

  35. Ratings • Supervisors rate performance of employees in each dimension • Two most common methods are : • Graphic Rating Scale • Behaviour Checklist

  36. Graphic Rating Scale Example Job knowledge Poor 1 2 3 4 5 Excellent Patrol activity Poor 1 2 3 4 5 Excellent Decision making Poor 1 2 3 4 5 Excellent Use of weapons Poor 1 2 3 4 5 Excellent

  37. Graphic Rating Scales: Advantages and Disadvantages • Easy to construct and easy to use • Likely to cause rating errors such as leniency and halo effect.

  38. Behaviour Checklist • Behaviour checklist contains a list of behaviors, expectations, or results of each dimension. • Focus is on the relevant behaviours. • Checklists are taken from the task statements from the Job Descriptions and converting them into behaviour performance statements. • Statements can be in the form of behaviours or in the form of results.

  39. Behaviour Checklist : Challenges • Result-focused statements may be favoured because evaluation of employees is seen by their contribution to the organization. • There is the danger of contamination using result-focused statements

  40. Step 6: Train raters • Training raters is very important to ensure sound evaluation system. • Trained raters reduce rating errors, increase accuracy and increase satisfaction of employees. • There is a lack of training of raters.

  41. Step 7: Observe and document performance • Observe and document critical incidents as they occur; written in a log. • Critical incidents should be communicated to the employees as they occur.

  42. Observe and document performance • Documentations are important: • Forces supervisors focus on behaviours rather than traits. • Help supervisors recall behaviours when evaluating performance. • Provide examples when reviewing performance ratings with employees. • Help defend organization against legal actions taken by employees who were terminated or denied.

  43. Step 8: : Evaluate performance • Obtaining and reviewing Objective Data • sources of contamination considered • Reading critical-incident Logs • help reduce errors • Completing the Rating Form • Aware of common rating errors: distribution errors, halo errors, proximity errors, contrast errors. • Aware of other challenges: low reliability across raters, sampling problems, cognitive processing of observed behaviour.

  44. Step 9: Communicate appraisal results to employees • Common practice: every six month • The “session” is usually done as quickly as possible because managers do not like it, and, not much benefit to them. • Certain techniques can help the session o be more effective, which includes preparation prior to the session and what to do during the session.

  45. Step 10: Make personnel decisions • The main aim of performance appraisal results is to provide feedback to employees regarding their behaviour. • Results can also be used to make pay rise, promotions or terminating an employee.

  46. Other types of rating scale • Behaviourally Anchored Rating Scales (BARS) • Forced-choice Rating Scales • Mixed standard scales • Behavioral Observation Scales

  47. Which is the best method?

  48. Main references: • Aamodt, M. G ( 2010). Industrial/Organizational Psychology. An Applied Approach.( 6th Ed) USA: Wadsworth • Riggio, R. E. ( 2009). Industrial and Organizational Psychology (5th ed). New Jersey: Pearson Education • Evaluating Employee Performance(2010). Cengage Learning

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