Methods of Performance Appraisal in detail

¨(1)  Traditional Methods :
¨These methods lay more emphasis on rating of individuals' personality traits, such as initiative, dependability, drive, creativity, integrity, intelligence, leadership potential, etc. In the following pages each method has been described in brief.
¨(a)  Ranking Method :
¨It is the oldest and simplest method of performance appraisal. In this method the employee is ranked from the highest to the lowest or from best to the worst. Thus, if there are ten employees the Best employee is given the first rank and the worst employee in the group is given the tenth rank.
However, this method has some limitations namely :
(1)  It is difficult to adopt this method, in case of evaluating large number of employees.
(2)  It is difficult to compare one individual with other having varying behavioural traits.
¨(b)  Paired Comparison Method :
¨In this method, each employee is compared with the other on one-to-one basis. This method makes judgement easier as compared to ranking method. The number of times the employee is rated as better in comparisons with others determines his or her final ranking. The total number of comparison can be ascertained by the following formula :
¨where N stands for number of employees to be evaluated.
¨The concept can be illustrated with the help of the following example.
¨If the following five students Ashok (A), Bina (B), Chitra (C), Dinesh (D), Eillen (E) have to be evaluated for the best student award, the total number of comparison would be = 10
¨A with B
¨A with C  B with C
¨A with D  B with D  C with D
¨A with E  B with E  C with E  D with E
¨The number of times a student gets a better score, would be the basis for selecting the Best Student. This method is not appropriate if a large number of students are required to be evaluated.
¨(c)  Forced Distribution Method :
¨This technique was contributed by Joseph Tiffin. The method operates under the assumption that an employee's performance can be plotted in a bell-shaped curve. Here 10% of the employees are given excellent grade, 20% are given good grade, 40% are given the average grade, next 20% are given the below average grade and last 10% are given unsatisfactory grade.
¨(d)  Forced Choice Method :
¨This method was contributed by J.P. Guilford. Here, an evaluator rates an employee on the basis of a group of statements. These statements are a combination of positive and negative statements and are arranged in blocks of two or more. The rater is required to identify the most or least descriptive statement pertaining to an employee. For example :
¨(1)  Provides clear guidance to employees.
¨(2)  Can be depended to complete the assignment on hand.
¨(3)  Is reliable and trustworthy.
¨(4)  Is partial to some employees
¨(e)  Check-list Method :
¨The main purpose of this method is to reduce the evaluator's burden of rating the employee. In this method a dichotomous questionnaire (A question with two answer choices namely `Yes' or `No') is used. A rater is required to put a tick mark against the respective column.
¨This questionnaire is prepared and scored by the HR department. The main disadvantage of this method is the rater is not given the flexibility to add or delete the statements. A typical check list is given below :
¨Table 3 : Check list for Students
¨(1)  Is the student regular
¨(2)  Is he/she disciplined
¨(3)  Does he/she complete the assignment on time
¨(4)  Does he/she participate in extra-curricular activities 
(f)  Critical Incident Method :
This method evaluates an employee on the basis of certain `events' or `episodes' known as critical incident. The underlying principle of this method is "there are certain significant acts in each employee's behaviour and performance, which can make all the difference between success and failure on the job." Thus, in this method the rater focusses his attention on all those factors, that can make a difference between performing a job in a noteworthy manner.
¨Graphic or Linear Rating Scale :
¨This is the most commonly used method of evaluating an employee's performance. Here the Questionnaire consists of more than 2 answer choices. The Questionnaire consists of set of questions covering aspects such as:
¨(i) Employee Characteristics (includes factors such as initiative, leadership, dependability, attitude, loyalty, creative ability, analytical ability etc.) (ii) Employee Contribution (includes factors such as Quantity and Quality of work, Specific goals achieved, regularity, attitude and approach towards supervisors and colleagues, etc.)
¨The following table highlights a typical graphic rating scale:
¨(1) Quality of Work  o  o  o  o
¨  Unsatisfactory  Satisfactory  Sometimes  Consistently
¨(2) Dependability  o  o  o  o
¨  Requires   Requires   Very little   No
  Constant  Occasional  Supervision 
Supervision  follow-up
¨(h)  Essay Method :
¨In this method, the rater writes a narrative description of an employees strengths, weaknesses, past performance, potential and suggestions for improvement. As there is no prescribed format, the length and content of essay is likely to vary. Similarly, the quality of Essay would depend upon the rater's writing skills. As the essays are descriptive in nature, it only provides qualitative information about the employee.
¨(i)  Field Review Method :
¨If during the appraisal process there are reasons to believe that the employee is given a higher rating because of rater bias, a review process is initiated. The review process is generally conducted by the personnel officer of the HR department.
¨This method is also used for making promotional decisions at the managerial level and when information is required from employees of different units and location.
¨(j)  Confidential Report :
¨This is a traditional method of evaluating an employee's performance. It is normally used in Government departments and small business units. Here, the evaluation is done by the immediate boss or supervisor. The main limitation of this method is the ratings are generally not discussed with the ratee (only in case of adverse remark).