It could be their direct manager (most common method), subordinates, customers or clients, self, and/or peers. Every performance evaluation should be directly tied with that employee’s job description.ĭetermining who should evaluate the performance of the employee is the next decision. First, we will need to develop the actual forms that will be used to evaluate each job within the organization. Once the frequency, rewards, and goals have been determined, it is time to begin to formalize the process. In other words, what goals does the organization hope to achieve with the performance appraisal process? The third consideration should include goal setting. There is research that shows employees have a greater acceptance of performance reviews if the review is linked to rewards (Bannister & Balkin, 1990). Should pay increases be tied to performance evaluations? This might be the second consideration before development of a performance evaluation process. Once you have the number of hours it takes, you can multiply that by your manager’s hourly pay to get an estimated cost to the organization Asking for feedback from managers and employees is also a good way to determine how often performance evaluations should be given.Īverage time to complete one written reviewĪdministrative time to set up meetings with employeesĢ5 employees × 2 hours per employee + 1 hour administrative time to set up times to meet with employees = 51 hours To determine costs of your performance evaluations, see Table 11.1 “Estimating the Costs of Performance Evaluations”. If most of your managers have twenty or more employees, it may not be feasible to perform this process more than once per year. For example, if most of your managers have five or ten people to manage (this is called span of control), it might be worthwhile to give performance evaluations more than once per year, since the time cost isn’t high. Depending on your organization’s structure, you may choose one or the other. If done well, it could take several hours for just one employee. The downside is the time it takes for the manager to write the evaluation and discuss it with the employee. The advantage to giving an evaluation twice per year, of course, is more feedback and opportunity for employee development. Some organizations choose to give performance evaluations once per year, while others give them twice per year, or more. Please keep in mind that managers should constantly be giving feedback to employees, and this process is a more formal way of doing so. The first step in the process is to determine how often performance appraisals should be given. When designing this process, we should recognize that any process has its limitations, but if we plan it correctly, we can minimize some of these. For the purpose of this chapter, let’s assume we can create a performance appraisal system that will provide value to the organization and the employee. Some researchers suggest that the performance appraisal system is perhaps one of the most important parts of the organization (Lawrie, 1990), while others suggest that performance appraisal systems are ultimately flawed (Derven, 1990), making them worthless. There are a number of things to consider before designing or revising an existing performance appraisal system.

Four elements trainer 7.4