Methods of Performance Appraisal

With the evolution and development of appraisal system, a number of methods or techniques of performance appraisal have been developed. The important among them are presented in following figure.

I. Trait Methods

Trait methods to performance appraisal measure the extent to which employees possess traits or characteristics like dependability, creativity, initiative, dynamism, ability to motivate and leadership. Trait methods are designed based on job description and job specification.

1. Graphic rating scales

Graphic rating scales compare individual performance to an absolute standard. In this method, judgments about performance are recorded on a scale. This is the oldest and widely used technique. This method is also known as linear rating scale or simple rating scale. The appraisers are supplied with printed forms, one for each employee. These forms contain a number of objectives, behavior and trait-based qualities and characters to be rated like quality and volume of work, job knowledge, dependability, initiative, attitude etc., in the case of workers and analytical ability, creative ability, initiative, leadership qualities, emotional stability in the case of managerial personnel. These forms contain rating of scales. Rating scales are of two types, viz., continuous rating scale and discontinuous rating scales. In continuous order like 0, 1, 2, 3, 4, and 5 and in discontinuous scale the appraiser assigns the points to each degree. Performance regarding each character is known by the points given by the rater. The points given by the rater to each character are added up to find out the overall performance. Employees are ranked on the basis of total points assigned to each one of them.  

Pros:

• One reason for the popularity of the rating scales is its simplicity, which permits many employees to be quickly evaluated.

• Such scales have relatively low design cost and high in case of administration. They can easily pinpoint significant dimensions of the job.

Cons:

• The major drawback to these scales is their subjectivity and low reliability.

• Another limitation is that the descriptive words often used in such scales may have different meanings to different raters.

2. Ranking method

Under this method the employees are ranked from best to worst on some characteristics. The rater first finds the employee with the highest performance and the employees with the lower performance in that particular job category and rates the former as the best and the latter as the poorest. Then the rater selects the next highest and next lowest and so on until he rates all the employees in that group.

Consider all of your 20 employees in terms of their total performance. Then select the one you would consider as having best total performance. Put his name in Column I below, on the firs-line, numbered 1. Next pick out the person having the worst total performance, put his name at the bottom of column II, on the line numbered 20. Now from the remaining names, select the one having the best total performance. Put his name in the first column on line 2. Keep up this process until all names have been placed on the scale.

Pros & Cons:

• Ranking can be relatively easy and inexpensive, but its reliability and validity may be open to doubt.

• It may be affected by rater bias or varying performance standards.

• Ranking also means that somebody would always be in the backbench.

• It is possible that the low ranked individual in one group may turn out to be superstar in another group.

• One important limitation of the ranking method is that the size of the difference between individuals is not well defined. For instance, there may be little difference in performance between individuals ranked second and third, but a big difference between those ranked third and fourth.