Hi Vijayabaskar,
Performance Appraisal is a part of PMS. The following write-up would give you an insight into how you can go about establishing the PMS at your organization.
Performance management is an organization wide program that provides a structured approach to:
Identify performance standards
Communicate standards
Performance appraisal
Facilitate common understanding of “what” is to be achieved & “how” is to be achieved
Measure & motivate performance
Provide basis for compensation decisions, promotion decisions,
training and developmental programs, feed-back & personal development of employees
An effective Performance Management System should achieve the following:
• Review the employment cycle of every employee, beginning with the recruiting process, employee development, and ending with effective exit interviews.
• Link employee's knowledge, skills, and abilities with the organization's human capital needs and business objectives.
• Provide managers and employees with the tools necessary to focus on short-term and long-term goals that contribute to both career and organizational success.
• Support the organization in developing and sustaining a culture that recognizes and rewards individual contributions and team performance.
• Promote a work climate that requires employees to remain flexibly focused. For instance, employees can manage current tasks and unit goals while keeping pace with, and adapting to, change in the work environment.
HIGHLIGHTS OF THE SYSTEM
• The appraiser and the appraisee jointly set the Key
Result Areas (KRAs) and assign mutually agreed
weightage expressed as a percentage. The
achievement of the KRA is also expressed as a
percentage.
• Simple mathematical relationship between set
weightage and accomplishment gives a final numerical
score on KRAs.
• To evaluate all management personnel on company
values and leadership attributes a new section has
been added entitled “Values in Action”.
VALUES IN ACTION
• RELIABLE & RESPONSIVE
• SERVICE TO INTERNAL &
EXTERNAL CUSTOMERS
• DRIVE FOR RESULTS
• QUALITY ORIENTATION
• MANAGING TIME
• COMMANDS RESPECT
• LEARNING, CREATIVITY &
INNOVATION
• COMMUNICATION
• COACHING
• BUILDS WINNING TEAMS
• INSPIRES TRUST
• BUSINESS ACUMEN
• PROBLEM SOLVING &
DECISION MAKING
• STRATEGIC VISIONARY
• CORPORATE CITIZENSHIP
• CONCERN FOR SAFETY AND ENVIRONMENT
WHAT IS A KEY RESULT AREA?
• A KRA refers to a target that needs to be achieved by
the appraisee in a given time.
• KRAs are the set of performance expectations from
the appraisee.
• The focus is on tangible outputs. However this does
not mean that tasks that have a qualitative output
cannot form a KRA.
• KRAs are not job descriptions or routine
activities. They do arise from job description but are
not a collective ‘whole’ of all job activities put
together.
KRA SETTING PROCESS
• Key Result Areas for an employee emerge from
the organizational objectives, departmental goals
and work unit goals. This facilitates congruency
between individual and departmental goals.
• The process of setting KRAs is a TOP-DOWN
approach.
SETTING KRA’s IN CASE OF A FUNCTIONAL REPORTING RELATIONSHIP
• Functional reporting cases will require input from the
functional superior in setting KRAs for the appraisee.
• The appraiser, the appraisee and the functional superior
will have to mutually agree upon the KRAs for the
appraisee.
• In case of a disagreement, it will be the functional
superior’s responsibility to convince the administrative
superior to reach an agreement on the KRAs and
communicate the same to the appraisee.
• In some cases, functional goals could be super-ordinate
to business goals.
WHEN APPRAISEE STATES THE NEED FOR FURTHER DISCUSSION
• The reviewer meets the appraiser to
investigate the point of disagreement.
• The reviewer decides to meet the appraisee to
hear his / her views.
• The reviewer examines the case and
communicates his / her decision to the
appraiser.
• The appraiser communicates the decision of
the reviewer to the appraisee.
MODERATION & NORMALIZATION
PROCESS
• The Reviewer and Divisional Head will moderate each
of the KRA and the Values in Action scores of
an individual employee.
• Under moderation if the scores change, the reviewer /
appraiser will revert to the appraisee and explain the
specific changes made in each score and the reason /rationale behind the change.
• Following this, the KRA and Values in Action scores
may undergo normalization, if required.
FURTHER LINKS EMERGING FROM
THE PMS
• Rewards and Recognition
• Training and Development
• Potential Appraisal
• Career and Succession Planning
360-DEGREE FEEDBACK – The most widely used tool for Performance Appraisal
In human resources, 360-degree feedback, also known as 'multi-rater feedback', 'multisource feedback', or 'multisource assessment', is employee development feedback that comes from all around the employee. "360" refers to the 360 degrees in a circle. The feedback would come from subordinates, peers, and managers in the organizational hierarchy, as well as self-assessment, and in some cases external sources such as customers and suppliers or other interested stakeholders. It may be contrasted with upward feedback, where managers are given feedback by their direct reports, or a traditional performance appraisal, where the employees are most often reviewed only by their manager.
The results from 360-degree feedback are often used by the person receiving the feedback to plan their training and development. The results are also used by some organizations for making promotional or pay decisions, which is sometimes called "360-degree review."
Hope this helps!