CIMA E1 Syllabus E3. Human resources - Performance management - Notes ^{6 / 9}

Performance management

Performance management assesses and ensures that the employee is carrying out their duties which they are employed to do in an effective and satisfactory manner

This is done in 4 steps:

1. Set targets - set SMART(Specific, Measurable, Achievable, Relevant, Timely) goals at the start of each period

2. Monitor - The manager will monitor the employees and give them feedback

3. Review - The manager and employees will come together at the end of the period and review how successful they were in achieving the targets.

4. Action plan - Establish targets for the coming period

Appraisal

Appraisal is an important part of the HR cycle. It is the systematic review and assessment of an employee's performance, potential and training needs.

There are several benefits of appraising:

1. Aiding technical, professional and management development

2. A source of motivation

3. Allowing a systematic follow-up of the results of staff development activities

4. A mechanism to set objectives for the next period

5. Identifying good prospects for promotion or transfer

Lockett suggested that there are six main barriers to effective appraisal:

1. Confrontation - for example, feedback is delivered badly or differing views regarding performance.

2. Judgement - appraisal is seen as a one-sided process.

3. Chat - lack of will from either party, no outcomes set.

4. Bureaucracy - purely seen as a ‘form-filling’ exercise with no purpose or worth.

5. Annual event - a traditional ceremony carried out once (or maybe twice) a year.

6. Unfinished business - no follow up or points agreed not actioned.

Types of appraisals:

1. Self appraisal - This has the advantage of saving managerial time and it offers increased responsibility to the individual.

2. Appraiser/appraisee -  The person who establishes the work appraises the workers that are carried out to do it

3. 180 degree - This can be performed in open group sessions with emphasis on how the group performed overall and then the individual’s contribution

4. 360 degree - The appraisee prepares feedback on the appraiser. 

   360 degree feedback is part of a system that encourages performance appraisal based on feedback from peers, subordinates, line managers and even external parties.

General appraisal techniques

1. Overall assessment

   Managers write in narrative form their judgements about the appraisees.

2. Guided assessment

   Assessors are required to comment on a number of specified characteristics and performance elements, with guidelines as to how they are to be interpreted in the work context.

3. Common appraisal standards

   Assessments must be related to a common standard (the appraisal standard) in order for comparisons to be made between individuals.

4. Grading

   Grading adds a comparative frame of reference to the general guidelines, whereby managers are asked to select one of a number of levels or degrees to which the individual in question displays the given characteristic

5. Behavioural incident methods

   These concentrate on employee behaviour, which is measured against typical behaviour in each job as defined by common critical incidents of successful and unsuccessful job behaviour reported by managers

6. Objectives and results orientated schemes

   This reviews performance against specific targets and standards of performance agreed in advance.