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1. Need for performance appraisal
In this file, you can ref useful information about need for performance appraisal such as need for
performance appraisal methods, need for performance appraisal tips, need for performance
appraisal forms, need for performance appraisal phrases … If you need more assistant for need
for performance appraisal, please leave your comment at the end of file.
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I. Contents of getting need for performance appraisal
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The reality is that the traditional performance appraisal as practiced in the majority of
organizations today is fundamentally flawed and incongruent with our values-based, vision-
driven and collaborative work environments. There is compelling new research that shows
performance reviews actually don’t improve performance, and may actually cause a decline in
performance. Also, performance reviews are tied to the Bell or Normal Curve, which is now
being seriously questioned.
Performance reviews have been around for ages, apparently as far back as third-century China,
but were popularized during the Industrial Revolution. Certainly by the l980’s performance
appraisals in the form of GE’s CEO Jack Welsh’s “rank-and-yank” system were widely used in
organizations.
New research (link is external) by psychologists at Kansas State University, Eastern Kentucky
University and Texas A&M University examined how people respond to negative feedback they
receive in performance reviews. Conventional wisdom is that people who are really motivated to
improve their performance would respond well to getting critical feedback in a performance
review. The research demonstrated this wisdom is wrong. Those employees who have a desire to
learn and grow—presumably the best employees—were significantly bothered by the negative
feedback they received. One of the authors of the study argues that if negative feedback has the
potential to discourage even the best performers, then managers need to be aware that what was
meant as praise doesn’t get misconstrued as criticism.

2. These conclusions are echoed (link is external) by Stanford University Professor Bob Sutton
comments that doing performance evaluations well is like doing “blood-letting well—it is a bad
practice that does more harm than good in all or nearly all cases.” Sutton argues in his book, with
co-author, psychologist Jeffrey Pfeffer, Hard Facts, Dangerous Half-Truths And Total Nonsense
(link is external), “performance rankings can lead to destructive internal competition, which can
make it tough to build a culture of knowledge sharing….In addition, there seems to be a self-
fulfilling prophecy at work, in which a person who receives a poor evaluation does even worse in
the subsequent rating period.”
In an article published in The Psychological Bulletin (link is external), psychologists A. Kluger
and A. Denisi report completion of a meta-analysis of 607 studies of performance evaluations
and concluded that at least 30% of the performance reviews ended up in decreased employee
performance. Many specialists in the field have written about ineffective performance reviews.
Tom Coens and Mary Jenkins, in Abolishing Performance Appraisals: Why They Backfire and
What To Do Instead (link is external), cite studies that clearly show performance appraisals do
not work and suggest a replacement; and Aubrey Daniels, author of Oops! 13 Management
Practices That Waste Time and Money (link is external), argues that performance appraisals are
actually counter-productive. Daniels cites a study by the Society for Human Resource
Management that found 90% of performance appraisals are painful and don’t work; and they
produce an extremely low percentage of top performers.
Brain research shows that when a person’s status is threatened—which often happens in
performance reviews that contain “constructive feedback”—activity diminishes in certain
regions of the brain. David Rock, author of Your Brain At Work (link is external), and director
of the Neuroleadership Institute, says that when that occurs, “people’s fields of view actually
constrict, they can take in a narrow stream of data, and there’s a restriction in creativity.
Performance reviews are tied to our belief in the Bell Curve, or “normal curve” a system first
developed by Abraham de Moivre in 1733. Its use moved from the observation of planets to the
use in population statistics in the 19th century and finally used in an evaluation of the
performance and intelligence of individuals.
Josh Bersin in his article (link is external)in Forbes on the myth of the Bell Curve says the curve
“does not accurately reflect the way people perform. As a result, HR departments and business
leaders inadvertently create agonizing problems with employee performance and happiness.”
Bersin cites how Microsoft has decided to disband its performance management process, --“after
decades of use the company realized it was encouraging many of its top people to leave.” Bersin
cites the research by Ernest O’Boyle Jr. and Herman Aguinis who found that 94% of researchers,
entertainers, politicians and athletes did not follow a normal distribution but rather a “Power

3. Law” or “long tail” distribution, in which there are a small number of “hyper high performers,” a
large number of “good performers,” and a smaller number of “low performers.”
So what is the alternative to performance appraisal systems? If you want to develop the good
performers and hyper high performers, companies need to focus very heavily on “collaboration,
professional development, coaching and empowering people to do great things,” says Bersin.
Clearly, the annual performance review was designed for a work environment where control of
individual employee performance was a key function. In today’s collaborative environment, that
perspective no longer makes sense. Some key questions that need to be answered are: Why are
we perpetuating a system that research (including recent brain research) shows is not only
ineffective, but counterproductive; and what are better processes to replace the performance
review?
==================
III. Performance appraisal methods
1.Ranking Method
The ranking system requires the rater to rank his
subordinates on overall performance. This consists in
simply putting a man in a rank order. Under this method,
the ranking of an employee in a work group is done
against that of another employee. The relative position of
each employee is tested in terms of his numerical rank. It
may also be done by ranking a person on his job
performance against another member of the competitive
group.
Advantages of Ranking Method
i. Employees are ranked according to their performance
levels.
ii. It is easier to rank the best and the worst employee.
Limitations of Ranking Method
i. The “whole man” is compared with another “whole man”
in this method. In practice, it is very difficult to compare
individuals possessing various individual traits.
ii. This method speaks only of the position where an
employee stands in his group. It does not test anything
about how much better or how much worse an employee
is when compared to another employee.
iii. When a large number of employees are working, ranking
of individuals become a difficult issue.

4. iv. There is no systematic procedure for ranking individuals
in the organization. The ranking system does not eliminate
the possibility of snap judgements.
2. Rating Scale
Rating scales consists of several numerical scales
representing job related performance criterions such as
dependability, initiative, output, attendance, attitude etc.
Each scales ranges from excellent to poor. The total
numerical scores are computed and final conclusions are
derived. Advantages – Adaptability, easy to use, low cost,
every type of job can be evaluated, large number of
employees covered, no formal training required.
Disadvantages – Rater’s biases
3. Checklist method
Under this method, checklist of statements of traits of
employee in the form of Yes or No based questions is
prepared. Here the rater only does the reporting or
checking and HR department does the actual evaluation.
Advantages – economy, ease of administration, limited
training required, standardization. Disadvantages – Raters
biases, use of improper weighs by HR, does not allow
rater to give relative ratings
4. Critical Incidents Method

5. The approach is focused on certain critical behaviors of
employee that makes all the difference in the
performance. Supervisors as and when they occur record
such incidents. Advantages – Evaluations are based on
actual job behaviors, ratings are supported by
descriptions, feedback is easy, reduces recency biases,
chances of subordinate improvement are high.
Disadvantages – Negative incidents can be prioritized,
forgetting incidents, overly close supervision; feedback
may be too much and may appear to be punishment.
5. Essay Method
In this method the rater writes down the employee
description in detail within a number of broad categories
like, overall impression of performance, promoteability
of employee, existing capabilities and qualifications of
performing jobs, strengths and weaknesses and training
needs of the employee. Advantage – It is extremely
useful in filing information gaps about the employees
that often occur in a better-structured checklist.
Disadvantages – It its highly dependent upon the writing
skills of rater and most of them are not good writers.
They may get confused success depends on the memory
power of raters.
6. Behaviorally Anchored Rating Scales
statements of effective and ineffective behaviors
determine the points. They are said to be
behaviorally anchored. The rater is supposed to
say, which behavior describes the employee
performance. Advantages – helps overcome rating
errors. Disadvantages – Suffers from distortions
inherent in most rating techniques.

6. III. Other topics related to Need for performance appraisal (pdf download)
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