Struggling with Performance Appraisal: How to Ensure Final Ratings Don't Exceed 100%?

Clarification on Performance Appraisal

I need clarification on performance appraisal. I have set 3 KRAs with a specific weightage for each KRA and 3-5 KPIs for each KRA.

The formula used to calculate the score of each KPI is: average(Sum of KPI) * weightage. The final rating is determined by using the formula: sum of each KRA weightage / 3.

Even though I provide ratings for all the KPIs, the final rating exceeds 100%. Can anyone assist me in achieving a final rating of 100%?

Thank you.

Dear Nisha,

Please note the following:

a) You can assign weights to the KRAs; however, the total of weights should be 100 and it cannot exceed 100.

b) The formula to calculate the score for each KRA is as follows:

[{(target achieved)/(target given)}*weight]*100

c) For example, if the KRA for the Purchase Manager was to attain an Inventory Turnover Ratio (ITR) of 4.5. At the end of the Financial Year (FY), he could achieve an ITR of 4.4, whereas the weight for this KRA was 40%. Then the calculation for the score for the KRA would be:

[(4.4/4.5)*0.40]*100 = [0.98*0.40]*100 = 0.392*100 = 39.2%

d) What if the Purchase Manager achieves the target more than it was given, i.e., what if he achieves the ITR of 4.7? In that case, the calculation for the score for the KRA would be:

[(4.7/4.5)*0.40]*100 = [1.04*0.40]*100 = 0.416*100 = 41.6%

e) What if the employee achieves more than the given target for each KRA?

Reply: Such a situation is rare; however, in that case, the final score will exceed 100. This is perfectly normal.

I hope the above explanation is sufficient.

Thanks,

Dinesh Divekar

Formula for Calculating Percentage of Target Achieved

The formula for calculating the percentage of the target achieved is as follows:
\[(target achieved / target given) * weight\] * 100

For example:
\[(4.4 / 4.5) * 0.40\] * 100 = \[0.98 * 0.40\] * 100 = 0.392 * 100 = 39.2%

Clarification

- To find the target achieved: \[(4.4 / 4.5) * 0.40\] * 100
- To find the target given: \[0.98 * 0.40\] * 100
- The weight is calculated as: 0.392 * 100 = 39.2%

Please correct me if I am mistaken. It would be appreciated if this could be explained with more clarity.

Thank you.

Dear Nisha, the explanation provided is thorough, and no further clarification is necessary. There is no formula to calculate the given target or weight. To determine the KRA score, we require three things: the target given, target achieved, and weight. Simply input these three figures into the formula, and that's it!

Thanks,

Dinesh Divekar

The Role of KRA/KPI in Task Management

KRA/KPI plays an imperative role in the management of tasks. It is utilized by employees to ensure that they have performed and achieved goals. The KPI/KRA calculation method includes weightage given to targets. An employee is given a set of targets that need to be achieved in a quarter. For instance, a sales employee receives a target of acquiring 80 or more clients in a month. The formula is used to calculate the weighted score of the employee at the end of the period.