What is Performance Evaluation?

 In terms of strategic human resources management, human resources are the most valuable capital of enterprises. Therefore, an investment in human resources means an investment in a business. Performance evaluation is one of the most valuable investments in human resources in businesses. Let's examine the subject of performance evaluation by answering questions such as what is 360-degree performance evaluation and what are the performance evaluation methods .

 

Before we talk about details such as performance evaluation criteria, let's answer the question of what is performance . The word performance, which comes to our language from English, has meanings such as success and execution. We can express the question of what is performance evaluation as the work done by the employees of the enterprise to measure the level of efficiency. The performance appraisal system has a significant impact on the decisions taken on key issues for human resources, such as career management and remuneration.

 

 Human resources performance evaluation emerged with the realization that employee satisfaction has an effect on productivity. This system was started to be used by the private sector in the 1960s as a productivity increase tool. With the transition from personnel management to human resources management, performance evaluation techniques have become a more widely used method.

 

Personnel management and performance appraisal in enterprises are two concepts that are close to each other, but they are not the same. The most obvious difference between these two concepts, which are often confused, is that performance appraisals are more of a remuneration relationship. Other differences are:

 

Responsibility for performance evaluation of the human resources unit; In performance management, the responsibility rests with the manager.

While performance evaluation focuses on the goal and the numerical result; Personnel management focuses on behavior.

While bureaucratic complex forms are in question in performance evaluation; There is not much documentation in personnel management.

While performance evaluation processes proceed in the form of superior subordinate evaluation; Evaluation in personnel management is done by mutual interview.

What are the Purposes of Performance Evaluation

 

What are the Performance Evaluation Purposes?

Thanks to the personnel performance evaluation notes, it is possible to obtain information about the work performance of the employees. The most important advantage of this is wage increase, bonus, training needs, promotion etc. is to make the right decisions. By determining which aspects of the staff are good or weak, human resources specialists can decide to start a process for training, firing, and employment. In general, we can list the purposes of performance evaluation as follows:

 

Ensuring that promotions are made fairly

Discovering the weaknesses or strengths of the employees in the field of work , highlighting the talents of the employee

Determining the rate of bonus, promotion and salary increase

Identifying people to be fired

Keeping internal motivation high

Clear goals and expectations

Encouraging coaching and mentoring

To enable manpower planning

Deciding on hiring

Establishing justifications for issues such as layoffs

Compare the performances with the target and see the difference

 

Personnel appraisal ensures that employees work with high satisfaction in a fair work environment. Measuring the performance of the employee provides benefits for the organization and the manager as well as the employee's self- discovery. The benefits for the manager are:

 

Identifying the strengths and weaknesses of the staff

Strengthening communication with subordinates

Providing the opportunity to demonstrate managerial skills

Increasing the performance of the institution due to the increase in the performance of the employee

The benefits of staff evaluation to the business are as follows:

 

Results that demonstrate employee performance indicate training needs

Goals are set

Increases internal communication

Service quality is improved

When is Performance Evaluation Conducted?

One of the most frequently asked questions about the performance appraisal process is how often the performance appraisal will be done. Of course, there is no clear answer to the question of when performance evaluation is made ; however, performing a performance evaluation every 3, 6 months or 1 year is important to achieve business goals.

 

What are Performance Evaluation Methods

 

What are Performance Evaluation Methods?

Performance measurement criteria, performance evaluation approaches and methods differ between businesses. However, HRM performance evaluation methods are examined in two different groups as classical and modern (contemporary) methods.

 

Traditional Performance Evaluation Methods

Simple Ranking Method: In traditional performance evaluation methods, the simplest and most cost-effective performance evaluation method is the simple ranking method. In the simple ranking method, employees are ranked from the best to the weakest according to certain qualities.

 

Pairwise Comparison Method: In the paired comparison method used by businesses with a small number of employees, employees are evaluated in pairs and marked. This method provides advantages in terms of time and cost.

 

Forced Distribution Method: In this method, performance is determined as a percentage. Performance evaluation errors may occur due to the use of the bell curve system .

 

Critical Incident Method: In this performance appraisal method, supervisors constantly observe their subordinates and evaluate positive and negative behaviors in order to obtain results.

 

Checklist Method: In the checklist method, which is one of the traditional performance evaluation methods, questions about employees are marked as yes or no.

 

Group Evaluation Method: In this method, an employee is evaluated by more than one person. Although this method requires more time than other methods, less bias ensures a fair assessment.

 

Behavior Evaluation Scales: In this method, employee behaviors are scored. This method of describing behavior is more scientific. Errors are also less.

 

Free Form and Composition Method: In this method, the performance appraiser takes notes about the employee. The disadvantage of this method is that it depends on the writing ability of the evaluator.

 

Contemporary Performance Evaluation Methods

Evaluation Center Method: The evaluation center method, which dates back to 1943, is applied by trained observers. In this method, employees are included in simulation games, role plays or working groups. Thus, many characteristics of employees from creativity to administrative skills are determined.

 

Management by Objectives: This method dates back to 1954. In the method, targets are determined by the top management. Employees are informed about what these targets are. Performance evaluation is also made in this direction.

 

Psychological Evaluation Method: This method, which is not preferred because it does not result quickly and is costly, focuses more on discovering future performance potentials.

 

Balanced Score Card: According to this method, which was designed in 1992, the following four elements must be in balance for evaluation: finance, customer satisfaction, work efficiency, level of learning and development.

 

Evaluation According to Competencies: In this evaluation method, it is aimed to harmonize the employees with the corporate culture and mission. This method can motivate employees better.

 

360 Degree Performance Evaluation Method: We can say that the most curious method among the performance measurement methods is the 360 degree performance evaluation method . What is the 360 degree performance evaluation system, where does the 360 number come from ? We can express this method as a systematic evaluation method. In the method, it is not only the superiors who evaluate the employees. Subordinates, customers, suppliers, in short, everyone with whom the employee is in contact are included in this system.

 

Performance Evaluation Process Stages

Today, human resources programs are used with the modern human resources approach and 360-degree performance evaluation is preferred as the most efficient system. The process is in the form of determining the purpose and criteria, creating an area where performance can be observed, and scoring the performance. In this process, the effectiveness of the system should be measured, updated, adequate training should be given to the employee, and the middle level should be included in the system. Otherwise, the process will fail. Errors in performance appraisal are:

 

Halo effect: Evaluating employees only on the area they are very good at

The cuckolding effect: Evaluating the employee only in terms of his/her weaknesses

Central tendency: to do all the evaluation in one general category

Indulge: Giving the employee more points than they deserve

Not tolerating: Giving an employee less points than he or she deserves

Similarity error: Giving a high score by feeling close to the employee for reasons such as life history

Diversity effect: Evaluating the employee in relation to each other rather than individually

We answered what does personnel evaluation mean and shared information about the techniques used in performance evaluation . Performance evaluation is key to the success of human resource management. We recommend that you learn more about this subject if you are working or planning to work in the field of human resources .