CHAPTER 5
Evaluating Employee
Performance
Introduction to
Industrial/Organizational
Psychology by Ronald Riggio

Job Performance and
Performance Appraisals
 A thorough job analysis is the starting
point for measuring and evaluating
actual job performance.
 Performance appraisals involve the
assessment of worker performance on
the basis of predetermined
organizational standards.

The Measurement
of Job Performance
 One way to categorize performance is in
terms of objective and subjective criteria.
 Objective performance criteria are more
quantifiable measurements of performance,
such as the number of units produced or
dollar sales.
 Subjective performance criteria typically
involve judgments or ratings of performance.

The Measurement
of Job Performance
 Concerns for a performance criterion include:
 Whether it is relevant to job success
(criterion relevance).
 Whether the criterion contains elements that
detract from the “pure” assessment of
performance (criterion contamination).
 The degree to which a criterion falls short of
perfect assessment of job performance
(criterion deficiency).
 Whether the criterion is usable (criterion
usefulness).

The Measurement
of Job Performance
 Self-appraisals are ratings or
evaluations made by the workers
themselves.
 Peer appraisals involve coworkers
rating each other’s performance.
 360-degree feedback involves getting
multiple performance evaluations,
from supervisors, peers, subordinates,
and customers.

The Measurement
of Job Performance
 Comparative methods of appraisal, such as
the paired comparison and forced-
distribution techniques, directly compare
one worker's performance with that of other
workers.
 Individual methods of appraisal do not make
direct comparisons with other workers.
 Individual methods include checklists and
forced-choice scales.

The Measurement
of Job Performance
 The most common method of individual
performance appraisal involves the use of
graphic rating scales, where an appraiser
uses a standardized rating instrument to
make a numerical and/or verbal rating of
various dimensions of job performance.
 The behaviorally anchored rating scale
(BARS) uses examples of good and poor
behavioral incidents as substitutes for the
scale anchors found in traditional rating
instruments.

Problems and Pitfalls in
Performance Appraisals
 A major problem in rating job performance
is caused by systematic biases and errors.
 Types of response tendency errors include:
 Leniency errors.
 Severity errors.
 Central tendency errors.
 Halo effects occur when appraisers make
overall positive (or negative) performance
appraisals because of one known
outstanding characteristic or action.

Problems and Pitfalls in
Performance Appraisals
 There are also errors caused by giving
greater weight to more recent performance,
known as recency effects.
 The actor-observer bias refers to the
tendency for an appraiser to place greater
emphasis on dispositional factors and
lesser emphasis on situational factors that
may have affected performance.

The Performance Appraisal
Process
 A good performance appraisal
consists of two parts:
 Performance assessment.
 Performance feedback.

Legal Concerns in Performance
Appraisals
 Performance appraisals must be valid
procedures, resulting from job analyses,
that do not unfairly discriminate against any
group of workers.
 Because of the proliferation of work teams,
organizations are developing team
appraisals–evaluations based on an
interdependent group of workers as a unit.