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

Behaviorally Anchored Rating Scale (BARS)

A BARS method first determines the main performance dimensions of the job, for example, interpersonal relationships. Then the tool utilizes narrative information, such as from a critical incidents file, and assigns quantified ranks to each expected behavior. In this system, there is a specific narrative outlining what exemplifies a "good" and "poor" behavior for each category. The advantage of this type of system is that it focuses on the desired behaviors that are important to complete a task or perform a specific job. This method combines a graphic rating scale with a critical incidents system. The US Army Research Institute developed a BARS scale to measure the abilities of tactical thinking skills for combat leaders. Figure 11.4 "Example of BARS" provides an example of how the Army measures these skills.

Figure 11.4 Example of BARS 

Figure 11.5 More Examples of Performance Appraisal Types


How Would You Handle This?

Playing Favorites

You were just promoted to manager of a high-end retail store. As you are sorting through your responsibilities, you receive an e-mail from HR outlining the process for performance evaluations. You are also notified that you must give two performance evaluations within the next two weeks. This concerns you, because you don't know any of the employees and their abilities yet. You aren't sure if you should base their performance on what you see in a short time period or if you should ask other employees for their thoughts on their peers' performance. As you go through the files on the computer, you find a critical incident file left from the previous manager, and you think this might help. As you look through it, it is obvious the past manager had "favorite" employees and you aren't sure if you should base the evaluations on this information. How would you handle this?

Table 11.3 Advantages and Disadvantages of Each Performance Appraisal Method

Type of Performance Appraisal Method Advantages Disadvantages
Graphic Rating Scale Inexpensive to develop Subjectivity
Easily understood by employees and managers Can be difficult to use in making compensation and promotion decisions
Essay Can easily provide feedback on the positive abilities of the employee Subjectivity
Writing ability of reviewer impacts validity
Time consuming (if not combined with other methods)
Checklist scale Measurable traits can point out specific behavioral expectations Does not allow for detailed answers or explanations (unless combined with another method)
Critical Incidents Provides specific examples Tendency to report negative incidents
Time consuming for manager
Work Standards Approach Ability to measure specific components of the job Does not allow for deviations
Ranking Can create a high-performance work culture Possible bias
Validity depends on the amount of interaction between employees and manager
Can negatively affect teamwork
MBOs Open communication Many only work for some types of job titles
Employee may have more "buy-in"
BARS Focus is on desired behaviors Time consuming to set up
Scale is for each specific job
Desired behaviors are clearly outlined
No one performance appraisal is best, so most companies use a variety of methods to ensure the best results.