Problems and Solutions of Performance Appraisal - Essay Example

Problems and Solutions of Performance Appraisal s In conditions of intense competition, companies strive to control and enhance productivity of their workers. Therefore, management of human resources is tightly connected to job performance appraisal as an integral part of staff deployment. Although variety and flexibility of appraisal methods and strategies are great, there are still certain pitfalls and problems undermining usefulness and efficiency of this process: the paper provides an analysis of the most common problems and their possible solutions. Introduction Managing activity is a continuous process implying business communication and constant work with people. For staff selection and deployment are integral aspects of human resources management, the manager constantly examines and evaluates workers. Workers’ performance and capacities can be evaluated according to certain scales in order to define their level of compliance with expectations imposed by the employer. Therefore, performance appraisal is a fundamental tool for job performance evaluation and “setting job standards” (Ather Khan et al., 2014). Moreover, it is considered an efficient way of enhancing job productivity and efficiency within organizations: successful practice of performance appraisal is able to benefit both an employee in the course of career development and employers (increasing efficiency would mean increase in benefit). “With every passing day, business organizations are facing aggressive competition due to globalization; so, they need more competencies to meet these challenges” (Malik & Aslam, 2013). On the other hand, performance appraisal is widely used as a tool enabling decision-making on promotion of the workers: “promotion decisions require a comprehensive assessment of the employees’ skills and abilities” (Jirjahn & Poutsma, 2013). Therefore, the data an employer could rely on in this respect is provided by performance appraisal, too. Both in private and in public sectors, the system of performance appraisal exists in various formats, incorporating a range of instrumental subsystems closely connected to major HR management functions: training and development, motivation, compensations and allowances, staff deployment, making personnel decisions and working with the candidate pool. Performance evaluation implies existence of steady criteria and scales, for instance, the Key Performance Indicator (KPI); and evaluation of personnel in business is usually divided into competency appraisal (including knowledge, skills, values and personal features of an employee) and performance evaluation (achievement of business goals and KPI). As performance appraisal involves multisided assessment of workers’ personalities, psychology plays a significant role in this process, with formal and informal evaluation methods being distinguished in psychological framework. Formal methods include “stress” interviews, biographical information and documentation study, as well as various types of tests; while informal methods are predominantly intuitive in nature and are driven by psychological mechanism o expectation and empathy. Methods of performance appraisal Nowadays, theory and practice have over two dozens of various methods for workers’ assessment: some of them are descriptive in nature, offering qualitative rather than qualitative evaluation of workers; others mix both descriptive strategy and quantitative assessment; and the third schematic group incorporates methods used for quite unbiased quantitative evaluation of workers’ productivity and personal characteristics. Naturally, the first type of methods presuppose high level of subjectivity as they are mainly based on biased judgments of the person performing appraisal: for instance, making judgments based on biographical data evaluation or group discussion (of an employee’s progress) implies no objective precise rules and criteria. The second type of methods implies partially objective strategies and might include experts’ judgments on frequency of some qualities’ manifestation: frequency can be paralleled to a certain point scale reflecting rates like “never”, “sometimes”, “often” and others. Here, one can provide diverse types of testing as an example: the worker might be asked to resolve a standardized professional task and evaluated on a quantitative scale reflecting quality of performance during the test. The third group is characterized by maximum precision, while performance level has well-defined parallels to fixed numeric indexes. Within this methodological perspective, a certain number of points can be given to an employee for each achievement. In professional evaluation practice, a double-sided approach towards personnel assessment has developed: on one hand, it is evaluation of individual person’s features; on the other hand, there is evaluation of generic qualities. In the process of evaluation, one comes across analysis and synthesis of information and the need for typological approach in order to draw a conclusion about a separate phenomenon or quality isolated from context. Given the wide variety of methods and tools for job performance appraisal, it is crucial to define the purpose and select adequate methodology in order to avoid problems in assessment and negative impact on productivity and experience of the staff. The method of appraisal should be characterized by high reliability. However, one could encounter a range of difficulties in the course of professional appraisal and thus be able to handle them properly. Publicity and stress The issue present almost in each case of job performance appraisal is publicity, as this is the key principle of evaluation procedure. The process of appraisal preparation becomes public as well as its results. However, ethical concerns might be raised in this respect, as this approach eliminates humanistic “ingredient” typical for our modern legal community and reflected in respect for the personality of the rated worker and his right to participate exclusively on a voluntary basis. This type of evaluation doesn’t preserve anonymity of results and recommendations issued after testing. Such policy of openness might hurt the worker’s dignity and self-esteem, so ethical aspect of evaluation should be carefully elaborated. Furthermore, assessment itself is a delicate procedure that can easily lead to stress and problems with self-confidence in the employee. Therefore, the whole system of testing should be as mild as possible; methods and procedure should be variative, for the worker will be able to choose the way of assessment, which is the most suitable for him/her. At the same time, the employee should be assisted and treated friendly in order to avoid any impressions of bias. Bias in appraisal One of the most common problems emerging in the course of performance evaluation is subjectivity of judgments and appraisal. As far as experience received by the employees during performance appraisal is related to the concept of organizational justice (Farndale & Kelliher, 2013), subjective or biased evaluation of the worker’s job performance might become a negative experience for him/her and produce negative impact on his/her attitudes and behaviors. It is rather plausible that subjectivism in professional evaluation is most likely to emerge in the first type of appraisal methods, which exclude use of numeric or precisely scaled data. Sometimes, managers impair organizational climate and their authority with redeploying staff and fixing salaries under the influence of personal antipathy. The judgment of the rater can be affected by personal prejudices and values that can distort it. Bias might descent from gender, religion, ethnicity/race, aspects of appearance or sexual orientation etc. Therefore, workers who are lucky enough to be the raters’ favorites will be easily excused for late attendances and other failures, whereas those disliked by the administration will get profoundly negative experience from biased treatment and – as a result – show worse professional results. These effects of biased evaluation are referred to as halo and horns effect, implying generalization of judgment based on either liked or disliked quality respectively. However, the problem of bias in performance appraisal can be handled successfully via use of the following recommendations. First of all, if there is only one person evaluating personnel in an organization, it would be desirable that the senior management gave powers of workers’ evaluation and testing to several people. This means that the opinion the raters are likely to form about the worker after reading would be less biased as the result of assessment would be constituted by several points of view formed by separate people. Secondly, performance appraisal could be handled by the HR managers distanced from the enterprise, as this will ensure impartiality in assessment. Moreover, according to the results of the study performed by Selvarajan & Cloninger (2012), a good solution to ensure fairness and accuracy is implementation of multisource appraisals: “Multisource appraisals from self, peers, customers, and other sources tend to be perceived as more accurate and more fair, which, in turn, may result in higher levels of appraisal satisfaction and motivation to improve performance based on appraisals”. In relation to the previous one, selection of the high-qualified managers able to handle performance appraisal task successfully is also a problem. Except willing to work in this area, the candidate must possess a wide range of professional qualities like perfect skills of interviewing workers; a quick eye; good knowledge of the relations inside the work team; flexibility, skills in application of standard evaluation programs and ability to develop and implement new ones. The company using appraisal control system should steadily define the most important criteria for job performance evaluation. The problem of varying standards As far as appraisal is always based on a certain set of expectations and professionals standards to be met by the employees, these expectations and standards are to be universal for all the employees subordinate to the manager. However, the problem related to bias might rise – the standards imposed by the manager on different workers may vary, hence creating unequal conditions and unfairness. Here, the only possible solution depends on the manager: equal standards should be set for all the workers in performance appraisal or – if there is a good reason – the standards may vary, yet the manager rating the worker’s performance should be able to explain and argument the difference. Focusing on contrast Given the existing universal set of standards of work performance and productivity, the manager is expected to evaluate each worker’s performance strictly according to these standards without any bias. However, sometimes, managers tend to evaluate one worker comparing him/her to others and thus basing their assessments on the results of contrasting rather than on bare objective standards. For example, if the standard of performance is estimated 10 sales per week and two employees had 10 and 12 sales respectively, it is incorrect to assess the former’s performance as inferior to that of the latter, as the former meets the requirements and fulfills the norm. Thus, it is natural that, in this case, evaluation of each worker’s performance should occur separately relying solely on universal standards. Recency effect Sometimes, a manager might fail to focus on the entire dynamics of the employee’s performance during performance appraisal. Instead, only recent outstanding failure or outstanding achievement is taken into account in the process of performance review, resulting in inadequate assessment of the staff member’s capabilities and qualifications. However, this problem can be solved with help of precise and careful recording of all achievements and mistakes made by the worker – this might help the manager to get rid of bias during appraisal. Other problems Difficulties in performance appraisal can be also caused by certain subjective reasons (on the part of the manager). The latter might understand the essence of his/her job and expected results rather unclearly or be unable to interpret the scientific data to the form comprehensible for the employees. Except that, the manager might understand the specificity of the production process not very well. Therefore, appraisal problems related to the qualification of the rater might be tackled – first of all – by training of the latter. However, training of the rater is not a cure-all method to prevent bias. Training usually does not help to increase accuracy of the assessment or eliminate rating errors. This means that solution to bias in appraisal lies in the combination of training and reduction of external factors’ impact. Generally, problems might emerge on all stages of appraisal process. For instance, it is lack of standards and norms for performance evaluation: the manager is unable to give impartial assessment to the worker’s performance without a fixed set of standards; instead, only blurred assumptions and subjective speculations. Norms should be well elaborated, accomplishable, objective and enabling high-quality productivity evaluation. Therefore, greater attention to standards and norms to be met by the personnel will surely solve the problem of performance evaluation at least partially. However, even perfectly arranged standards will be useless if they are not communicated to the staff properly. Thus, poor feedback between management and employees might pose another difficulty, as the latter will not be able to improve their performance to meet standards, for they will be unaware of the standards themselves. Regarding purely psychological aspect of performance appraisal in the company, one should mention ethics of the psychologist’s work in the company. It is natural that the same result can be achieved at different expenses – different people will perform the same function spending different amounts of psychological and physical resources. For some employees, psychological stress connected to job performance might be excessive. However, it is doubtful whether the psychologist must insist on discharging such a worker form employment, if he/she performs his duties in accordance with standards. Such ethical issues are frequently faced by psychologists working in big companies as senior management seldom makes decisions about staff deployment. Conclusion In conditions of globalization and growing competition, each company’s senior managements seeks to enhance productivity and efficiency as much as possible, and high level of job performance in staff is vital in this respect. The system of performance appraisal established for this purpose is extremely helpful, yet the process might include various types of problems undermining its efficiency. As it is seen from the paper, most of the issues causing difficulties in appraisal are directly connected with the human factor. Thus, it could be concluded that much attention should be paid to training of managers, who, in addition, should train their self-control and have an unbiased eye. Moreover, ethical and technical aspects of performance appraisal are to be taken into account. References Ather Khan, H. M., Hassaan Chandio, J., & Khan Farooqi, M. T. (2014). Comparison of Performance Appraisal System in Public and Private Schools. Pakistan Journal Of Commerce & Social Sciences, 8(1), 272-278. Farndale, E., & Kelliher, C. (2013). Implementing Performance Appraisal: Exploring the Employee Experience. Human Resource Management, 52(6), 879-897. Jirjahn, U., & Poutsma, E. (2013). The Use of Performance Appraisal Systems: Evidence from Dutch Establishment Data. Industrial Relations, 52(4), 801-828. Malik, M. S., & Aslam, S. (2013). Performance Appraisal and Employees Motivation: A Comparative Analysis of Telecom Industry of Pakistan. Pakistan Journal Of Social Sciences (PJSS), 33(1), 179-189. Selvarajan, T. T., & Cloninger, P. A. (2012). Can performance appraisals motivate employees to improve performance? A Mexican study. International Journal Of Human Resource Management, 23(15), 3063-3084. Read More