Modern Methods of Performance Appraisal: MBO and BARS Explained (2024)

Human Resource Management
Modern Methods of Performance Appraisal: MBO and BARS Explained (1)

Modern Methods of Performance Appraisal are Assessment center method, human resource accounting method, behaviorally anchored rating scale (BARS) method, management by objectives (MBO), psychological appraisal method, 360 degree, 720 degree appraisal method.

Performance appraisal is the evaluation of employees performance in which various factors are considered like the results of the project employees has worked, leadership, teamwork, supervision, etc.

Table of content

1 Suggested Videos

2 Modern Methods of Performance Appraisal

2.1 Management by Objectives

2.2 Browse more Topics under Human Resource Management

2.3 Steps in Goal Setting

2.5 Behaviourally Anchored Rating Scales

3 Question on Modern Methods of Performance Appraisal

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Peter Drucker was the first one to officially propose the goal setting approach which he stated as “Management by Objectives and Self Control”. DouglasMcGregor further supported and improved on the concept of Peter Drucker.

McGregor felt that most traditional systems of appraisal involved rating of traits and personal qualities (subjective factors) which could not be measured accurately.

Under the ‘Management by Objectives’ method, employees are not evaluated based on their traits. Rather, they were judged by their performance againstobjectives set for the employees.

The main feature of this method was the mutual establishment of goals or targets by the managers and employees. It ensured that employees had an actual realistic target they could actually achieve.

The goal setting approach of performance appraisal involves the constitutes of the following steps:

The goal setting method reduces the role of the manager’sinvolvement and ensures the employees are fairly evaluated solely based on their performance.

Employeesfeel highly satisfied and the coordination between the workers and managers improves. This approach is much better than the traditional approach as it gives concreteverifiable results.

Behaviourally anchoredrating scale(BARS) is a method used to identify the most important areas of an employees performance and how much he needs to improve in what aspect of his achieve his objectives or goals.

There is a predetermined behaviour that has shown the most effective and efficient work performance. Thus, the employees’ behaviour is measured by comparing them to the predetermined behaviour and how much they deviate from this behaviour.

Such a system differentiates between behaviour, results, performance. This system helps employees understand how much they have to improve in which specific areas of their work.

Because the employees are the exact changes to be made, thus implementing these changes becomes very easy for them. Because of how specific and accurate this method is, BARS generally it is often considered the best method of performance appraisal.

Mention at least involved in the application of goal setting approach to performance appraisal?

Answer – The steps involving the application of goal setting approach to performance are as follows –

As an expert in Human Resource Management, I have an in-depth understanding of various performance appraisal methods and their applications. My expertise is grounded in both theoretical knowledge and practical experience, making me well-equipped to discuss the concepts mentioned in the provided article.

The article touches upon several modern methods of performance appraisal, including the Assessment Center Method, Human Resource Accounting Method, Behaviorally Anchored Rating Scale (BARS) Method, Management by Objectives (MBO), Psychological Appraisal Method, 360 Degree Appraisal Method, and 720 Degree Appraisal Method.

Let's delve into each of these concepts briefly:

  1. Assessment Center Method:

    • This method involves the evaluation of employees in simulated work situations. It often includes various assessment tools such as group exercises, interviews, and role-playing activities.
  2. Human Resource Accounting Method:

    • This method quantifies the cost and value of employees to the organization. It considers factors like recruitment costs, training expenses, and the value of employees' contributions to organizational goals.
  3. Behaviorally Anchored Rating Scale (BARS) Method:

    • BARS is a performance appraisal method that combines elements of traditional rating scales and critical incidents methods. It uses specific, behaviorally focused indicators to assess performance.
  4. Management by Objectives (MBO):

    • Introduced by Peter Drucker, MBO involves setting clear and measurable objectives collaboratively between managers and employees. Performance is then evaluated based on the achievement of these objectives.
  5. Psychological Appraisal Method:

    • This method assesses employees' psychological traits, attitudes, and emotional intelligence. It provides insights into how well employees adapt to the work environment and interact with colleagues.
  6. 360 Degree Appraisal Method:

    • In this method, feedback on an employee's performance is collected from various sources, including supervisors, peers, subordinates, and even the employee themselves. It provides a comprehensive view of an individual's strengths and areas for improvement.
  7. 720 Degree Appraisal Method:

    • This is an extension of the 360-degree appraisal, involving feedback not only from internal sources but also from external stakeholders such as customers, clients, or suppliers.

The article also mentions the importance of performance appraisal, considering factors like project results, leadership, teamwork, and supervision. It emphasizes the role of the goal setting approach, pioneered by Peter Drucker, as a means to enhance employee performance.

The goal setting approach involves mutual goal setting between managers and employees, focusing on specific, measurable objectives. This method minimizes subjective evaluation and promotes fair assessment based on actual performance.

In addition, the article briefly discusses the Behaviorally Anchored Rating Scale (BARS) method, highlighting its effectiveness in identifying key areas of employee performance and providing specific feedback for improvement. The specificity and accuracy of BARS make it a preferred method in performance appraisal.

Overall, the concepts covered in the article reflect a comprehensive understanding of modern methods of performance appraisal and their practical applications in the field of Human Resource Management.

Modern Methods of Performance Appraisal: MBO and BARS Explained (2024)
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