Employee Assessment

A performance review system is an approach to assessing and encouraging positive job performance. It is a tool for development, but it also provides the basis for the company to give raises and promotions or take corrective actions. There are various evaluation methods, including rating scales, essays, checklists, critical incident appraisals, work standards approach, and ranking methods. With the management by objectives (MBO) approach, performance is measured against the goals set by the manager and employee. A narrative is included with the behaviorally anchored rating scale (BARS) approach for each rating. This text addresses how to design an effective performance appraisal system.

Appraisal Methods

Learning Objective

  1. Be able to describe the various appraisal methods.

It probably goes without saying that different industries and jobs need different kinds of appraisal methods. For our purposes, we will discuss some of the main ways to assess performance in a performance evaluation form. Of course, these will change based upon the job specifications for each position within the company. In addition to industry-specific and job-specific methods, many organizations will use these methods in combination, as opposed to just one method. There are three main methods of determining performance. The first is the trait method, in which managers look at an employee's specific traits in relation to the job, such as friendliness to the customer. The behavioral method looks at individual actions within a specific job. Comparative methods compare one employee with other employees. Results methods are focused on employee accomplishments, such as whether or not employees met a quota.

Within the categories of performance appraisals, there are two main aspects to appraisal methods. First, the criteria are the aspects the employee is actually being evaluated on, which should be tied directly to the employee's job description. Second, the rating is the type of scale that will be used to rate each criterion in a performance evaluation: for example, scales of 1–5, essay ratings, or yes/no ratings. Tied to the rating and criteria is the weighting each item will be given. For example, if "communication" and "interaction with client" are two criteria, the interaction with the client may be weighted more than communication, depending on the job type. We will discuss the types of criteria and rating methods next.