Orthodox and Radical Critique of Performance Appraisal and Recent Innovations in Performance Management

Orthodox & Radical Critique of Performance Appraisal and Recent Innovations in Performance Management

M. Rezaul Karim^*

Abstract:Performance appraisal (PA) is a process of setting some targets for the individuals which they are required to achieve. Performance of individuals is evaluated by the process and good performance is acknowledged by rewarding them which may be financial rise in pay, popularly known as increment or upward movement in the hierarchy i.e. promotion. Traditionally PA is a straightforward process where the manager can only review the performance of his subordinates annually. However, in order to meet the increased expectations of employers, customer demand and better output, PA plays a crucial role for which it has become a part of a wider HRM strategy called performance management (PM). Traditional PA has some limitations that can be minimised by following multi-rater PA system. 360-degree feedback and balanced scorecard are playing important role as recent innovations in the PM system. These two tools are being widely used in both public and private organisations of developed countries like UK, USA, Germany, France; even in the public sectors in Bangladesh, Non-Government Organisations (NGOs) in particular. This paper aims at discussing the traditional PA system experienced with several problems which the new innovations such as 360 degree feedback and balanced scorecard have attempted to overcome.

1.0 Introduction

Human resource management practitioners and academics have tried to establish a relationship between human resource management (HRM) and organisational performance (Bach, 2005). This seems to be happening with the increase in competition world wide. Due to the globalisation, organisations are under pressure to increase productivity and curtail costs. This has placed HRM in a strategic position, as to increase productivity better performance of individuals becomes essential. In order to measure the performance of individuals, organisations make use of performance appraisal making it an integral part of human resource management practices. Traditionally performance appraisal was a straightforward process in which a line manager would review the performance of his subordinates annually (Bach, 2005). It was more of an annual ritual and its results were not utilized much over the course of the year. However, with the increase in employers’ expectations of greater employee performance, performance appraisal plays a crucial role. A performance appraisal is supposed to provide guidance to individuals on how they can best apply their resources to achieve the organisational goals (Brown and Benson, 2003; Townley, 1993).

An appraisal usually involves setting of targets for the individual which he is required to achieve and then in the next appraisal feedback is given on the progress (Brown and Benson, 2003). Performance appraisal was initially used to describe the process where a line manager would review on an annual basis on subordinates’ performance and then he usually would discuss the results with the concerned employee (Fletcher, 2001).

It has now become a part of a wider human resource strategy called performance management (Fletcher, 2001). Under traditional performance appraisal system it was mostly the managerial staff, professional workers and the sales staff that they were being apprised. Appraisals of board level directors were limited as they were almost half of the number comparing with other managers (Long, 1986:9, cited by Bach, 2005). Performance appraisals are used to evaluate individual performance and acknowledge good performance by rewarding it, though with the advent of 360 degree the use has widened to identifying development needs. In the traditional performance appraisal it was mostly the personality traits of the individual that were rated. It was believed that some traits and characteristics such as leadership and loyalty contribute immensely to the performance of an individual therefore making it essential to measure the same (Bach, 2005). The problem with such an appraisal lay in the fact that it was difficult to measure such traits, and to point out the exact trait responsible for better or worse performance. Assessing of personality trait of an employee is subjective to the opinion of the appraiser which may be biased by his liking or disliking for the concerned person which is also called ‘rater bias’ (Boxall and Purcell, 2003).

2.0 Purposes & Functions of Performance Appraisal

: Traditionally performance appraisal schemes are influenced by the dominant issues of personnel management. However, these tools have become ‘the best practice’ in the public and private sector in order to enhance managerial authority and increase efficiency (Bach, 2005). From the traditional viewpoint performance appraisal does the following things (Randell, 1989).

1. Evaluation: to enable the organisation to share out the money, promotions a perquisites apparently fairly
2. Auditing: to discover the work potential both present and future or individual or departmental
3. Successful planning: to construct plans for manpower, dept and corporate planning
4. Training: to discover learning needs by exposing inadequacies and deficiencies that could be remedied
5. Controlling: to ensure employee reach organisational standard and objectives
6. Developmen t: to develop individual by advice, information and through shaping heir behaviour by praise or punishment
7. Motivation: to add employee’s job satisfaction thru understanding their needs
8. Validation: to check the effectiveness o f personnel procedures and practices

3.0 Discussion

Performance appraisal, as the process of evaluating performance of individuals working in the organisation, indicates some strengths and weaknesses of concerned individual as well as organisational needs which should immediately be needed to address. For the development of employee performance and quality service and output, organisations needs to know the problems of traditional PA system so that organisations can take initiatives where the orthodox and radical critique can show the way out.

3.1 Orthodox Critique

The orthodox critique of the traditional appraisal system discusses the problems with the procedure of appraisal systems. Appraisals are used to assess the need for training, to motivate individuals to perform better and to distribute performance based rewards.

The problem arises when the appraiser is required to play multiple conflicting roles that of a monitor, judge and counsellor (Strebler et al., 2001; Wilson, 2002). These conflicting roles are organisation vs. organisation, organisation vs. individual and individual vs. individual (Figure:1)

Figure1: Conflicts in performance appraisal

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^* PhD Student at Graduate School of Public Administration (GSPA) , National Institute of Development Administration (NIDA), Bangkok, Thailand and Permanent Faculty Member of Bangladesh Public Administration Training Centre (BPATC), Savar, Dhaka-1343, Bangladesh