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Performance

Management System
By
Narmadeshwar Prasad

Narmadeshwar Prasad
Performance Management
A process that consolidates goal setting, performance
appraisal, and development into a single, common
system, the aim of which is to ensure that the employee’s
performance is supporting the company’s strategic aims
The Process through which companies ensures that
employees are working towards organization goals

Narmadeshwar Prasad
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Conduct job design

Agree on clear job Provide training as needed


performance goals

Provide direction, immediate Provide training as needed


performance feed back, and
coaching Provide training for
immediate and future
Monitor job progress, giving needs
feedback, coaching, and Staffing decision
support •Continue

•Transfer

•Termination

Provide training for


Conduct performance appraisal: immediate and future
consider current job performance needs
and future career plans Staffing decision
•Continue

•Transfer

•Promotion
Input to formal reward system
•Termination
Narmadeshwar Prasad
Performance Appraisal Job Evaluation
Performance appraisal is concerned with Job evaluation is an analysis of various jobs to
the differences among the employees in know the demands which the normal
term of their performance. It is also termed performance of particular job make on average
as merit rating as it is concerned with the employee. It doesn’t take into account the
individual ability of the job holder
comparative merit of individuals.
It considers the requirement of various jobs in
It is considered the abilities and term of job description and job specification
performance of individuals.
The purpose of job Evaluation is limited i.e. to
The purpose of merit rating is to appraise determine the worth of the job on the basis of
the performance of individual to appraise demands made by a particular job on the
performance of individual to take decision average worker. This facilities fixation of wages
like increase in pay, transfer, promotion, for various jobs.
termination, etc. it also serves as the Job evaluation analyses the jobs to determine
guideline for the management to consider their relative worth and fix their wage levels
the type of training which should be that are fair and equitable.
imparted to the employee.
Job evaluation is used to shape the wage policy
Performance appraisal rates the employee of the organization.
and not the job as it is concerned with
assessing of the abilities of the individuals.
As a matter of fact, it measures the worth
of different employees in the organization.

Narmadeshwar Prasad
Purpose of Performance Appraisal System

Helps to achieve
organization's task
through guided efforts
of individual

Provides data for


evolving development Provides input for
plans for individual decisions on transfers,
promotion etc.

Performanc
e Appraisal
System
Provide data in terms
Enables clarification of
of needs aspirations of
expectations between
individual to review
superior and
company policies and
subordinate
Narmadeshwar Prasad structure
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Methods of Performance Appraisal System
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s ● Under this the Appraiser is required to write down
st
EE ru his impression about the person being appraised
r in an unstructured way. however in some
mm ct
u ● organizations, comment s are required to be
p ur Ranking is a simple process of placing employees in a
c p grouped under specific headings such as quality
F le rank according to their job performance . It permits
o Fo d of job performance,
comparison of all reasons for
employees in specific
any jobrating group
single
ou o
y rc A behavior,
regardless personality
of the type traits,
of andAll
work. development
workerstoare judged
r y The forced distribution system is devised
● force
e ed needs
ce e on p the the same factor
appraiser to fit andemployee
the they are rated
being on the overall
appraised
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scale. It has an instead
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a ib Under this method, scales
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Methods of Performance Appraisal System
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a ● An outgrowth of the critical incident method is the
v raldevelopment of BARS, which focus on specific job
MM Anbehaviors rather than traits or characteristics. These
ao a ch scales reduces the amount of judgment or subjectivity
nr or required of the rater and rely mostly on the rater’s
n
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power of observation. The main advantage of this
a
g Ratmethod over less rigorously developed graphic scales
eAg
B tinappears to be that the scales and terminology are clear
B
neme g iand demonstrably job related, and thus presumably
e
hec m Sc s
h● increase
e
both reliability and validity
anh al It is similar to BARS in
ov n a that they are both based
e a
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oye b i however in that rather
ARs
o than asking evaluator
odr y to
Narmadeshwar Prasad
S) y
Management By Objectives
Organization Department Inappropriat
goals and goals and e
metrics Metrics Goals/metric
s
Deleted
New inputs
Supervisor are then
Lists Goals Provided
and Mutual
Metrics for Agreement
Subordinate of
Subordinate Goals and
Proposes Metrics
Goals and
Metrics

Interim
Review of
Final review Review
Organization
Performance
Narmadeshwar Prasad
360 degree appraisal
the 360 appraisal is that the appraisal given peers, subordinates, workers, head of the
department etc that means the appraisal given from all the people working in the
organizations 360 degree appraisal. The half yearly report or yearly report of work
schedule goes from the company to the head quarter of all the workers performance is
the appraisal it contains all the demotion, promotion and other activities related to the
performance.
Empl
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Limitations of Performance appraisal

C
en● A

tr performance
Lenie
al rating error in
ncy
Te● A performance

or which all
Rn rating error in
employees
Strict
de which the
e are rated
● A performance rating error in
ness
cnc appraiser
about tends
y
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Error
to givethe appraiser is based
e average
largely on the employee’s most
o
n● A employees
performance rating error inonwhich
recent
n either behavior rather than
c an employee’s
behavior evaluation
throughout the is biased
appraisal
Si
tr either upward or downward because
y
a● period
mil A
of performance
comparison rating
with another
ar
st Error in which an
H
to employee just previously evaluated
aE appraiser inflates the
me ● The halo effect is a cognitive bias whereby the

lErrevaluation
rr
perception
of an employee
of one Trait (i.e. A Prasad
characteristic of a
o
o because of a mutual Narmadeshwar
Thank You

Narmadeshwar Prasad
Master of Human Resource and Organizational Developm
Faculty of Commerce and Business,
Delhi School of Economics,
Narmadeshwar Prasad
University of Delhi, 110007