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Unit 5: Appraising and Evaluating People in the Organization

Open Communication Notes

The results of the appraisal, particularly when they are negative, should be immediately
communicated to the employees, so that they may try to improve their performance. A good
appraisal system provides the needed feedback on a continuing basis. The appraisal interviews
should permit both parties to learn about the gaps and prepare themselves for future.
5.4.4 Post-appraisal Interview

A post-appraisal interview should be arranged so that employees are given feedback and
the organization understands the difficulties under which employees work, so that their
training needs may be discovered. Permitting employees to review the results of their
appraisal allows them to detect any errors that may have been made. If they disagree with
the evaluation, they can even challenge the same through normal channels.
Job Relatedness

Suggestions for improvement should be directed towards the objective facts of the job. Plans
for the future must be developed alongside in consultation with subordinates. The individual
as a person should never be criticised.
5.4.5 Problems of Performance Appraisal

None of the methods for appraising performance is absolutely valid or reliable. Each has its
own strengths and weaknesses. In spite of knowing that a completely error-free performance
appraisal can only be an idealised model, we can isolate a number of factors that significantly
impede objective evaluation. The major problems in performance appraisal are:
(a) Rating Biases: Most appraisal methods involve judgements. The performance appraisal
process and techniques rely on the evaluator who has his own personal biases, prejudices
and idiosyncrasies. It would be naive to assume that all evaluators will impartially
appraise their subordinates. The evaluator or raters biases include:
(i) Leniency and Strictness Error: Errors of leniency are caused by the tendency of the
lenient rater to put most of the ratees on the higher side of the scale, while the tough
rater places them on the lower side of the scale. This is so because every evaluator
has his own value system, which acts as a standard against which appraisals are
made. Relative to the true or actual performance an individual exhibits, some
evaluators mark high and others low. The former is referred to as positive leniency
error and the latter as negative leniency error (strictness error). When evaluators
are positively lenient in their appraisal, an individual’s performance becomes
overstated. Similarly, a negative leniency error understates performance, giving the
individual a lower appraisal. If the same person appraised all individuals in an
organization, there would be no problem. Although there would be an error factor,
it would be applied equally to everyone. The difficulty arises when there are
different raters with different leniency errors making judgements.
(ii) Halo Effect: The Halo effect is a tendency to allow the assessment on one trait to
influence assessment on others. According to Bernardin and Beatty Halo effect is
a tendency to rate high or low on all factors due to the impression of a high or
low rating on some specific factors. Generally, the tendency to rate higher is called
the Halo effect and the tendency to rate lower is called the Horn effect. This arises
when traits are unfamiliar, ill-defined and involve personal reactions. One way
of minimising the halo effect is by appraising all the employees on one trait
before going on to rate them on the basis of another trait.
(iii) Central Tendency Error: The central tendency error refers to the tendency of not
using extreme scale scores on the judgement scale; most of the rates are clustered
in the middle. According to Bernardin and Beatty, central tendency is the reluctance

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