When developing a PMS, managers should select options to assess the work skills, personality and behavior, to allow implementation of 360 degree feedback.
1. Management by Objectives (MBO)
Management by Objectives (MBO) is a process of defining objectives within an organization so that management and employees agree to the objectives and understand what they need to do in the organization.
The essence of MBO is participative goal setting, choosing course of actions and decision making. An important part of the MBO is the measurement and the comparison of the employee’s actual performance with the standards set. Ideally, when employees themselves have been involved with the goal setting and choosing the course of action to be followed by them, they are more likely to fulfill their responsibilities.
2. Critical Incident
The Critical Incident Technique is a set of procedures used for collecting direct observations of human behavior that have critical significance and meet methodically defined criteria. These observations are then kept track of as incidents, which are then used to solve practical problems. Critical Incident Technique is also widely used in organizational development as a research technique for identification of organizational problems. Critical Incident Technique is used as an interview technique, where the informants are encouraged to talk about unusual organizational incidents instead of answering direct questions. Using Critical Incident Technique deemphasizes the inclusion of general opinions about management and working procedures, instead focusing on specific incidents.
3. Behaviorally Anchored Rating Scales (BARS)
Behaviourally anchored are scales used to rate performance.It is an appraisal method used to describe a performance rating that focused on specific behaviors or sets as indicators of effective or ineffective performance, that aims to combine the benefits of narratives, critical incidents, and quantified ratings by anchoring a quantified scale with specific narrative examples of good, moderate, and poor performance.
4. 360-degree feedback
360-degree feedback, also known as multi-rater feedback, multisource feedback, or multisource assessment, is feedback that comes from all around an employee. Feedback is provided by subordinates, peers, and supervisors. It also includes a self-assessment and, in some cases, feedback from external sources such as customers and suppliers or other interested stakeholders. It may be contrasted with "upward feedback," where managers are given feedback by their direct reports, or a "traditional performance appraisal," where the employees are most often reviewed only by their managers.
The results from 360-degree feedback are often used by the person receiving the feedback to plan training and development. Results are also used by some organizations in making administrative decisions, such as pay or promotion
The table below shows the strength and weakness of each option/features chosen to develop a performance management system .
| Strength | Weakness |
Management by objective
| · Motivation · Better communication and Coordination | · It over-emphasizes the setting of goals over the working of a plan as a driver of outcomes. · When this approach is not properly set, agreed and managed by organizations. In this case, managing by objectives would be counterproductive.
|
Critical Incident | · Flexible method that can be used to improve multi-user systems. · Data is collected from the respondent's perspective and in his or her own words | · critical incidents often rely on memory, incidents may be imprecise or may even go unreported.
|
Behaviorally Anchored Rating Scales | · Ratings are not easily subjected to different interpretations of raters. | · Requires observational skill and proper determination of critical behaviors ; inadequacies can lead to misleading data · Time consuming process time |
360 degree Feedback | · More complete view of employee’s performance · More valid and objective because of multisource | · Sometimes honest due to peer pressure |
