Modern Methods of Performance Appraisal

Assessment center method

An assessment center is a place to evaluate an individual potentiality and performance, so as to position he/she in the core functional areas. normally, organisations outsource assessment centers instead of making them by their own. An assessment center typically involves the use of methods like social/informal events, tests and exercises, assignments being given to a group of employees to assess their competencies to take higher responsibilities in the future. Generally, employees are given an assignment similar to the job they would be expected to perform if promoted. The trained evaluators observe and evaluate employees as they perform the assigned jobs and are evaluated on job related characteristics.

Modern Methods

The 360 degree appraisal: 

The 360 degree method of performance appraisal is used to make the appraisal process more transparent, objective and participative. It introduced the concepts of self appraisal subordinates appraisal, peer appraisal and appraisal by customers. It is called a 360 degree method because it involves the evaluation of an employee by persons above him, below him and alongside him. Structured questionnaires are used to collect information from the seniors, subordinates and peers. The employee to be evaluated thus acquires a central position and everyone around him participates in the appraisal process in the 360 degree method.

Behaviorally anchored rating scale (BARS)

BARS some times called behavioural expectation scales are rating scales whose scale points are determined by statements of effective and ineffective behaviours. They are said to be behaviourally anchored in that the scales represented a range of descriptive statements of behaviour varying from the least to the effective. A rater must indicate which behaviour on each scale best describes an employee’s performance.

Management By Objectives (MBO)

It was Peter F. Drucker who first gave the concept of MBO. It is an individual evaluation method which measures task outcomes rather than behaviours. It is also called appraisal by results. MBO aims to increase organizational performance by aligning goals and subordinate objectives throughout the organization. Ideally,employees get strong input or identifying their objectives,timelines for completion,etc. MBO includes ongoing tracking and feedback in the process to reach objectives.

Human Resource Accounting Method

Human resources are a valuable asset for any organization and it can be valued in monetary terms. This method evaluates the performance of an employee in terms of costs and contributions. HR costs include expenses incurred on HR planning recruitment selection induction and training. The difference between this costs and the contribution by an employee reflects the performance of that employee. This method is still developing hence is not very popular at present.

Psychological Appraisal

Large organizations employ full-time industrial psychologists. When psychologists are used for evaluations,they assess an individual’s future potential and not past performance. The appraisal normally consists of in-depth interviews,psychological tests,discussions with supervisors and a review of other evaluations. The psychologist then writes an evaluation of the employee’s intellectual,emotional,motivational and other-related characteristics that suggest individual potential and may predict future performance.