Performance Appraisal Tutorial | Future Oriented Methods

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Future Oriented Methods of Performance Appraisal

Management by Objectives: It means management by objectives and the performance is rated against the achievement of objectives stated by the management. MBO process goes as under,

  • Establish goals and desired outcomes for each subordinate
  • Setting performance standards
  • Comparison of actual goals with goals attained by the employee
  • Establish new goals and new strategies for goals not achieved in previous year.

Advantage – It is more useful for managerial positions.

Disadvantages – Not applicable to all jobs, allocation of merit pay may result in setting short-term goals rather than important and long-term goals etc.

Psychological Appraisals: These appraisals are more directed to assess employee’s potential for future performance rather than the past one. It is done in the form of in-depth interviews, psychological tests, and discussion with supervisors and review of other evaluations. It is more focused on employees emotional, intellectual, and motivational and other personal characteristics affecting his performance.

Assessment Centers: This technique was first developed in USA and UK in 1943. An assessment center is a central location where managers may come together to have their participation in job related exercises evaluated by trained observers. It is more focused on observation of behaviors across a series of select exercises or work samples. Assessees are requested to participate in in-basket exercises, work groups, computer simulations, role playing and other similar activities which require same attributes for successful performance in actual job.

360-Degree Feedback: It is a technique which is systematic collection of performance data on an individual group, derived from a number of stakeholders like immediate supervisors, team members, customers, peers and self. In fact anyone who has useful information on how an employee does a job may be one of the appraisers. This technique is highly useful in terms of broader perspective, greater self-development and multi-source feedback is useful. 360-degree appraisals are useful to measure inter-personal skills, customer satisfaction and team building skills.

Behaviorally anchored rating scales: Behaviorally Anchored Rating Scales (BARS) is a relatively new technique which combines the graphic rating scale and critical incidents method. It consists of predetermined critical areas of job performance or sets of behavioral statements describing important job performance qualities as good or bad (for e.g. the qualities like inter personal relationships, adaptability and reliability, job knowledge etc).

Human resource accounting method: Human resources are valuable assets for every organization. Human resource accounting method tries to find the relative worth of these assets in the terms of money. Here the performance appraisal of the employees is judged in terms of cost and contribution of the employees.

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