Performance appraisals are an integral part of employee performance and development. Employees who get rewards for their good performance are more likely to stay loyal, perform better every year, and even motivate others to deliver quality performance. This is why it is important to measure employee performance in a fair and unbiased manner. Generally, there are two types of performance appraisal methods- Traditional performance appraisal methods and modern performance appraisal methods. Today, we are going to discuss traditional performance appraisal methods in detail. Let’s begin 👇 Show
Traditional Performance Appraisal MethodsGenerally, traditional methods of performance appraisal focus on employees’ ability to take initiatives, leverage resources, and perform tasks with innovation and creativity. Moreover, employees are also evaluated based on their leadership qualities, interpersonal skills, intelligence, and integrity. Let’s take a deeper dive into all of them: 👇 Traditional Methods Of Performance Appraisal1️⃣ Rating Scales MethodIt is a well-known traditional method of performance appraisal. As the name suggests, this performance appraisal method involves the use of a rating scale that spans from 1 to 10. In this performance appraisal method, employees’ performance is measured against several factors including their attitude, timeliness, efficiency, and interpersonal skills. For example, If an employee gets a low rating then it means they have received negative feedback, if the scale rating is high let’s say 9 or 10, then the employee has done exceptionally well. ➡️ Useful For: The rating scale is an effective appraisal method for assessing unique traits and behaviours within your workforce. ➡️ Pros:
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💡 Interesting Fact: Rating scales were first introduced in the year 1910 and by 1920, the rating scale method was introduced by the Scott Company. 2️⃣ Checklist MethodThe Checklist method is one of the easiest traditional performance appraisal methods. Under this traditional method of performance appraisal, HR prepares a checklist and forwards it to the manager. The checklist may include a list of questions (depicting behaviour and job performance of employees), and the manager has to answer them in just ‘YES’ or ‘NO’ form. The manager analyzes the question and the employee and answers them according to their evaluation of the employee. Questions in the checklist carry a numerical value based on their importance to job performance. Therefore, the appraisal score is calculated by adding up the scores of all these individual factors. For example, the checklist may contain a question- “Is the employee helpful to other team members?” The question may carry a numerical value of 5, so if an employee has been really helpful to their team, they may get a full score of 5 or if the employee isn’t helpful according to the manager’s analysis, then they might get 1 or Zero. ➡️ Useful For: Making employee performance easy to evaluate as their supervisors have to simply choose between yes/no. ➡️ Pros:
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💡 Interesting Fact: According to Mosher and other experts, the checklist method was employed in the first known collection evaluation at an American library, which was reported in 1849. 3️⃣ Forced Distribution MethodThis strategy is widely used in large corporations. It is predicted that employee performance varies widely within an organisation, with some individuals being more productive than others. As a result, with this strategy, the management must distribute employees based on their performance over the entire bell curve. Some are exceptional, while others are average, and still, others are at the bottom of the spectrum. ➡️ Useful For: Creating an unmistakable separation between the performances of every employee in the organization. ➡️ Pros:
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💡 Interesting Fact: Forced distribution method was first presented by General Electric in the 1980s. 4️⃣ Critical Incident Performance Appraisal MethodThe critical incident technique is a performance review method that examines an employee’s behaviour in specific circumstances, both in which he did admirably and those in which he could have improved. A series of methods are utilized to collect data and analyze it. The critical incident technique involves observing critical human behaviours, abilities, and on-the-job situations. Critical Incident Performance Appraisal Method➡️ Useful For: In comparison to other approaches, which may be highly objective and need only rankings to assess employee performance, this method is quite subjective. ➡️ Pros:
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💡 Interesting Fact: Sir Francis Galton’s research is credited with laying the groundwork for the Critical Incident Method. 5️⃣ Essay MethodThe management uses this strategy to produce a description of the employee’s behaviour and performance. In this method, the review description contains all pertinent information, such as the employee’s mindset, job knowledge, present performance, and potential for growth. ➡️ Useful For: Giving managers the flexibility to focus on whatever they personally find important about the individual’s performance. ➡️ Pros:
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💡 Interesting Fact: The essay method is labelled as the “grandfather” of performance appraisal methods. 6️⃣ Paired Comparison MethodEmployees are evaluated using this method based on any single attribute. Each employee is compared to others on a one-to-one basis, in pairs, based on a particular quality/attribute, for example, creativity. The formula N (N-1)/2 is used to calculate the number of potential pairs. While the letter N denotes the number of employees to be appraised. ➡️ Useful For: Companies that have a limited number of employees and funds. ➡️ Pros:
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💡 Interesting Fact: The origin of the paired comparison method can be traced back to it was first use in the mid-1800s. 7️⃣ Field Review MethodThis method is based on the supervisor’s assessment of the employee’s performance, behaviour, and skills. The HR professional invites seniors to respond to questions about the employee’s job and then evaluates the person based on the feedback obtained from managers. This is an evaluation conducted by someone outside of the employee’s department. ➡️ Useful For: Managerial level promotions or when a comparable analysis is needed. ➡️ Pros:
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💡 Interesting Fact: The field review method is considered to be one of the oldest methods of performance appraisals. Drawbacks of Traditional Performance Appraisal MethodsThese methods are highly subjective. The performance appraisal is dependent on the appraiser’s judgement, which is subject to favouritism and bias. Because the reviewer has not gotten enough job training, he is unable to effectively assess the performance of others. These performance appraisal techniques have several flaws, which include the following: Drawbacks Of Traditional Performance Appraisal Methods1️⃣ Halo Effect:This is one of the major drawbacks of traditional performance appraisal methods. When appraisers allow one significant attribute to affect their performance evaluation process, the phenomenon is known as the halo effect. Regardless of the employee’s performance, the appraiser assigns the same scores to all factors. 2️⃣ Leniency and Strictness:The appraisers have different tendencies when it comes to rating. Some are more liberal, while others are more rigorous. The evaluator’s habits mirror their rating of employees. You may have noticed that a lenient evaluator gives the employees good scores, whereas the stricter one gives them low scores for their performance. 3️⃣ Central Tendency:When the evaluator lacks appropriate knowledge about the employee and his performance and the time to devote to the performance appraisal process, he may play it safe and rate all employees’ performance as average. This propensity is a major flaw in the performance evaluation system. 4️⃣ Personal Bias & Favouritism:The evaluator’s bias towards employees based on sex, religion, caste, color, or status is fairly widespread. This makes objective appraisal difficult. The evaluator can be swayed by the member’s seniority and give him a high rating. Some supervisors want to purposely rate their subordinates low so that they can outperform them. ConclusionYou can use any of these methods to evaluate employee performance, however, the majority of these traditional performance appraisal methods are subjective. But worry not, by using a performance management system, you can make performance appraisals easy-peasy and fruitful at the same time. Wondering how performance management software can come to your rescue? Read This: Features of Performance Management System | Zimyo HRMS This blog will give you detailed information about how a performance management system can prove to be beneficial for your organization. FAQs1️⃣ Are traditional performance appraisal methods still relevant today?The answer to this question may vary from organization to organization. There are many small-sized enterprises that rely on traditional methods of performance appraisal. This is because the use of modern tools such as performance management software can be costly for them. Also, startups or small businesses have small teams so they don’t quite feel the need for having a modern performance management system at their disposal. But, most tech giants or megacorporations such as Google, Deloitte, Facebook, etc. are using modern performance management tools to evaluate employee performance. 2️⃣ What are the objectives of performance appraisals?The objectives of performance appraisals are to: 1. Evaluate an employees’ potential based on skills such as quality of work, leadership style, creativity, and interpersonal skills. 2. Improve the quality of projects or deliverables by helping analyze their strengths and weaknesses. 3. Boost the overall efficiency of the team by identifying the roadblocks and offering help in time. 4. Set measurable and attainable goals to help employees work on something meaningful. 5. Gather performance data to make informed decisions regarding salary hikes, promotions, incentives, or even terminations. 6. Conduct skills gap analysis and identify training needs for employees. 7. Boost employee engagement, satisfaction, and retention by fostering a culture of reward and recognition, and encouraging professional development. 3️⃣ How can organizations make their performance appraisal process fair and inclusive?✅ Continuous feedbackGone are the days when annual performance reviews were important for the performance review process. Today, organizations must focus on holistic performance management. Instead of yearly reviews, they must focus on weekly, monthly, or quarterly performance reviews. ✅ 360-degree feedbackThe 360-degree feedback approach ensures fairness and transparency in the performance review process. In this process, the employees receive feedback from peers or subordinates. You can use 360-degree feedback software to exchange constructive feedback. ✅ Pay as per performanceYou must reward your high performers not only to motivate them but also other members of the team. When you appreciate employees and offer the pay they deserve, they feel more productive, engaged, and satisfied with their work. ✅ Don’t punish, instead, upliftYou can use the performance review process as an opportunity to uplift the poor performers in your organization. So don’t punish people for bad performance as there could be hundreds of valid reasons for that, instead, you need to have frequent one-on-ones with your employees to understand their challenges. You can make a difference in their performance by equipping them with all the necessary resources or help they need to perform better. ✅ Allocate projects based on potential not on experienceAs managers, you must also ensure that there is a fair allocation of projects. You must assign responsibilities to qualified candidates even if it means disregarding the seniority level of an employee. This way you are giving fair and equal opportunities to all the team members to grow in their respective fields. Which is the most commonly used method of performance appraisal?A ratings scale—or grading system—is probably the most commonly used performance review method. This method is based on a set of employer-developed criteria—which can include behaviors, traits, competencies, or completed projects—against which employees are judged.
What is the best method of performance appraisal?10 Proven Performance Appraisal Methods. Ranking Method. The ranking method is possibly one of the oldest employee performance appraisal methods. ... . Essay Appraisal. ... . Paired Comparison. ... . Checklist Method. ... . Critical Incidents Method. ... . Management by Objectives (MBO) ... . Behaviourally Anchored Rating Scales (BARS) ... . The OKR Method.. What are the 4 most commonly used appraisal systems?The most common types of appraisal are:. straight ranking appraisals.. grading.. management by objective appraisals.. trait-based appraisals.. behaviour-based appraisals.. 360 reviews.. Which of the following is the most commonly used appraisal system?Trait appraisal approaches continue to be the most popular systems despite their inherent subjectivity.
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