15 Most Used Traditional Performance Appraisal Methods In HRM

15-most-effective-traditional-performance-appraisal-methods-in-hrm

Being a manager in any company entails a wide range of responsibilities. You’re responsible for inspiring your team to reach greater heights and completing all of the project requirements you’re in charge of. ✅

Performance appraisal is one of a manager’s numerous tasks. But, what exactly is a performance appraisal in HRM?

Although performance appraisals appear to be a simple task, they are far more challenging!

Employee performance evaluations help employers in determining how well their workforce contributes to the overall growth. In this blog, we’ll drill deeper into some of the traditional performance appraisal methods that you should know about. 👇

Traditional Methods Of Performance Appraisals

Traditional methods of performance appraisals emphasize rating the individual’s personality traits, such as initiative, dependability, motivation, creativity, integrity, intelligence, leadership potential, etc. 

Let’s take a deeper dive into all of them: 👇

traditional-methods-of-performance-appraisal
Traditional Methods Of Performance Appraisal

1️⃣ Rating Scales Method

It is a well-known traditional method of performance appraisal. Using a rating scale in this technique, we can measure employee performance against several factors. Employee’s attitude, timeliness, efficiency, and interpersonal skills are some of the parameters to assess performance. 

This approach has a rating scale that spans from 1 to 10. Negative feedback is indicated by a low rating, whereas a high rating indicates positive feedback.

➡️ Useful For:  

The rating scale is an effective appraisal method for assessing unique traits and behaviours within your workforce.

➡️ Pros: 
  • Helps in assessing employee attributes and how they relate to their current role.
  • They are structured and standardized in nature.
  • Useful for comparing employees against one another.
  • Helps assess salary adjustments.
  • Useful in considering candidates for promotion.
➡️ Cons: 
  • Responses are open to interpretation.
  • The final rating can be deceiving.
  • Average results can be difficult to interpret.
  • Recent events can influence answers.
➡️ Tips To Implement: 
  • Attempt to be as objective as possible when posing your questions. 
  • Avoid asking subjective questions.
  • Clearly establish criteria and expected outcomes.
  • Limit your questions to those that are behavioural in nature.
💡 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 Method

The Checklist method is one of the easiest employee performance appraisal methods. Under this method, 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 based on his views, he answers them. 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.

➡️ Useful For:  

Making employee performance easy to evaluate as their supervisors have to simply choose between yes/no. 

➡️ Pros: 
  • Helps managers avoid discrimination.
  • Ensures clarity of evaluation criteria.
  • Helps the manager to be objective in their reviews. 
  • Provides an organized view of the performance. 
➡️ Cons: 
  • Doesn’t allow elaborate explanations.
  • Time-consuming process.
  • Costly to prepare.
  • Easy to overlook some important evaluation factors.
➡️ Tips To Implement: 
  1. Focus on objective questions that can be answered in yes/no form. 
  2. Try to not put in a lot of questions as it can be very time consuming.
  3. Make sure that you don’t include a lot of negative statements. 
💡 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 Method

This 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 performances of every employee in the organization.

➡️ Pros:
  • Helpful in eliminating the leniency of the appraiser. 
  • Highlights future front-line leaders.
  • Relatively quick and easy model to understand and implement. 
➡️ Cons: 
  • Does not work well for high performing employees who are introverts in nature. 
  • Encourages discrimination among employees.
  • Can have a negative impact on innovative employees due to limited categories of evaluation.
➡️ Tips To Implement: 
  • All guidelines should be communicated to appraisers in a precise manner by the HR department. Each manager should be aware of how reviews should be interpreted and what each statement represents.
  • According to the method’s core principle, teams that perform better should be rewarded with various benefits.
  • Appraisers are unable to appraise employees at their discretion; instead, they must adhere to certain guidelines.
  • In order to achieve internal equality, businesses should calibrate their performance.
💡 Interesting Fact: 

Forced distribution method was first presented by General Electric in the 1980s.

4️⃣ Critical Incident Method

The 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
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:
  • It aids in the detection of unusual events that might otherwise go unnoticed by other means.
  • It’s inexpensive and gives you a lot of information.
  • The viewpoint of the respondent is taken into account.
  • Respondents are not compelled to fit within any certain framework.
  • There are numerous ways to apply the method, including observation, surveys, and interviews.
➡️ Cons: 
  • Many instances may go undetected or be inaccurate since incident reporting is based on the respondent’s perception.
  • It’s possible that biases will emerge in response to recent events.
  • The instances described may or may not be reflective of scenarios that occur on the job on a regular basis.
➡️ Tips To Implement: 
  • Begin by identifying and reviewing occurrences that happened during the course of the job.
  • The process of fact-finding includes acquiring information about the incident from members.
  • Examine the facts and data gathered from the participants by the interviewer and determine the concerns.
  • Determine whether the remedy will be able to eliminate the cause of the problem that has been discovered.
💡 Interesting Fact: 

Sir Francis Galton’s research is credited with laying the groundwork for the Critical Incident Method.

5️⃣ Essay Method

The management uses this strategy to produce a description of the employee’s behaviour and performance. The job 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:
  • The essay method is far less rigid and constraining.
  • Allows the manager to emphasize practically any significant issue or performance aspect.
  • The method is fairly open-ended and adaptable.
  • Subjective in nature.
➡️Cons: 
  • It takes a long time and is tough to administer.
  • It’s tough to draw conclusions about organisational demands.
  • A biassed essay could be written by a manager or supervisor.
  • From a business standpoint, it is unprofitable.
➡️ Tips To Implement: 
  • Make sure to keep the evaluation essay short and crisp in content. 
  • Try to highlight the weaknesses and strengths of the employee. 
  • Avoid the usage of any flowery language.
  • Divide your remarks into several pointers, making them easy to analyze. 
💡 Interesting Fact: 

The essay method is labelled as the “grandfather” of performance appraisal methods. 

6️⃣ Paired Comparison Method

Employees 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. The number of employees to be appraised is denoted by the letter N.

➡️ Useful For:  

Companies that have a limited number of employees and funds. 

➡️ Pros:
  • It aids the manager in determining priorities when competing demands on a company’s resources arise.
  • In nature, it is cost-effective.
  • It’s simple to pick the most significant problem to address or the solution that will give you the most benefit.
➡️ Cons: 
  • It’s beneficial when the priorities are unclear.
  • It’s especially useful when you don’t have any objective data to assess.
➡️ Tips To Implement: 
  • Make a list of the options you’ll compare (elements as A, B, C, D, E for example).
  • By applying the formula 5(5-1)/2, there will be a total of ten pairs to compare.
  • Make a table with six rows and seven columns.
  • Compare element “A” to elements “B,” “C,” “D,” and “E,” and set “point” in each column.
  • Finally, add up the totals of all the values for each of the variables to combine the findings. You might choose to translate these numbers to a percentage of your overall score.
💡 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 Method

This 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:
  • Reduces the chances of biased performance reviews. 
  • Useful for managerial level performance evaluations.
➡️ Cons: 
  • Outsiders are generally not familiar with employees’ performance; hence, the review might be inaccurate.
  • Observation of actual employee behaviours is not possible.
  • Highly time-consuming process.
  • The process is not very employee-friendly. 
➡️ Tips To Implement: 
  1. Prepare a set of predetermined questions to assess the talents and abilities of an employee.
  2. Interview the employee and ask questions.
  3. Record the responses of the employee. 
  4. Based on the interview, assign a rating to the employee.
  5. Take the manager’s review into account before calculating the final rating. 
💡 Interesting Fact: 

The field review method is considered to be one of the oldest methods of performance appraisals. 

Drawbacks of Traditional Method of Performance Appraisals

These 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-performance-appraisal-methods
Drawbacks Of Performance Appraisal Methods

1️⃣ Halo Effect:

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. The 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.

Conclusion

An employee’s performance can be evaluated using one of these methods, although the majority of these performance appraisal methods are subjective.

However, by using Zimyo’s performance management system, you can make performance appraisals easy-peasy and enjoyable at the same time. 😍

Wondering how performance management software can come to your rescue? 

Read More: Features of Performance Management System | Zimyo HRMS

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