The performance appraisal should compare “what should be” with “what is.” Managers use one or more of three bases—goals, job dimensions or traits, and behaviors or competencies—to establish ahead of time what the person’s performance standards should be. First, the manager can assess to what extent the employee is attaining their numerical goals. Such goals should derive from the company’s overall profitability, cost reduction, or efficiency goals.
Behavioral science research studies suggest four guidelines for setting performance goals: Assign specific goals. Employees who receive specific goals usually perform better than those who do not. Don’t just say, “do your best.” Assign measurable goals. Put goals in quantitative terms, and include target dates/deadlines. If measurable results will not be available, then satisfactory completion—such as satisfactorily attended workshop- is OK.
Assign challenging but doable goals. Goals should be challenging, but not so difficult that they appear unrealistic. Encourage participation. Managers often face this question: Should I tell my employees what their goals are, or let them participate with me in setting their goals? The evidence suggests they are similarly effective. A second basis upon which to appraise someone is with a form with basic job dimensions or traits such as communication or teamwork.
The assumption is that good teamwork is a useful standard for what should be. A third option is to appraise employees based on their mastery of the competencies (the skills, knowledge, and/or personal behaviors) the job requires.
