How to Build mature performance management system
without any automation software?- Part 5- How to define
Performance Rating scale and associating it with performance percentage.
Many organization use rating scale to
define performance of an individual. Often, there is confusion in the mind of
HR professional, on deciding what should be the performance rating pattern i.e.
whether to choose 5 rating scale or 10.
I have used both the rating scales and
find 5 rating scale is better and easy to monitor. It also can be understand by
both employee and manager easily. Although more than rating, meaning of rating
is important. If rating 1 is considered as top level performance, then employee
will consider it superior, else if, rating 5 is considered as top level performance,
then employee will consider it superior.
For my HR friends, I am sharing below,
which describes, 5 Rating scale along with significance of rating scale,
detailed meaning of rating, suggested bell curve distribution and what is the
action plan suggested for manager to take against employees who scores
respective rating. For my friend who do not understand concept of Bell curve
can google it. In brief, it is basically a performance pattern which can be
exhibited by a group of employees.
Rating 5 (Exemplary Performance)
Meaning : Performance is exemplary. Extremely smart worker, who successfully
innovates and is cut above the rest of his peers in terms of ability.
Distribution % : 10%
Plan of Action against each Rating ( to
be provided by Manager ) : i. Growth Roadmap :
options of growth for employee as foreseen by Manager. Action plan to groom the
employee towards same. Ii. Promotion Recommendations : Ready for next level
growth and same should be recommended with supporting
Rating 4 (Exceeds Expectation)
Meaning : Performance substantially exceeds the standard expected in all areas of
the job. The review / assessment indicates that the jobholder has not only
achieved effective results against all of the performance criteria but also has
been able to give Value addition to client in terms of impact &
satisfaction.
Distribution % : 25%
Plan of Action against each Rating ( to
be provided by Manager ) : i. Growth Roadmap :
options of growth for employee as foreseen by Manager. Action plan for grooming
the employee towards the same. Ii. Promotion Recommendation : Ready for next
level growth and same should be recommended with supporting i.
Growth Roadmap : options of growth for employee as foreseen by Manager. Action
plan for grooming the employee towards the same. Ii. Training Needs
Rating 3 (Meets Expectation)
Meaning : Employee is meeting the job expectation set for profile.
Distribution % : 45%
Plan of Action against each Rating ( to
be provided by Manager ) : i. Opportunity
Areas : areas that the person can focus on for further growth or development
for higher rating ii. Training Needs.
Rating 2 (Does not meet expectation- But can be improved)
Meaning : Employee is not meeting expectation set for him. Need improvement. There
is possibility of improvement in performance if given guidance.
Distribution % : 10%
Plan of Action against each Rating ( to
be provided by Manager ) : i.
Grace : Borderline. Not met expectation due to external factors and hence given
grace, ii. PIP : Improvement required and hence
to be put in PIP iii. Drop from role / organisation due to incompetence
Rating 1 (Does not meet expectation- Poor Performance)
Meaning : Employee is not meeting expectation set for him. Very poor performance
and need immediate improvement.
Distribution % : 10%
Plan of Action against each
Rating ( to be provided by Manager ) : i. Immediately put
under PIP (Performance improvement Plan ii) Out of organization, in case no
improvement
Relation Performance percentage with Performance rating:
Another
question, which comes in our mind, how to relate performance percentages with
performance rating? Now it can differ from manager to manager and organization
to organization, but as HR you need to define a range which can be referred by
both employee and manager. Of course, a little deviation is ok, let’s say 20%
up or down but it should be monitored properly else every manager will have its
own definition of rating scale and later on we will find it difficult to bring
symmetry in same.
Below
is the range, which I use for linking performance rating and performance
percentages.
Rating Significance Performance
5 Exemplary Performance 121%
and above
4 Exceeds Expectation 110%
to 120%
3 Meets expectation 90%
to 109%
2 Sometime meets expectation 70%
to 89%
1 Does not meet expectation <70%
Further
we will see, how above association is used to evaluate employee performance and
assign performance rating to him?
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