Setting Organisational Performance Standards
Effective performance appraisal relies on clear performance standards being established and discussed with employees. Using these standards, appraisal involves:
- observing the employee’s work behaviour and results, and comparing them against the agreed standards
- evaluating job performance and the employee’s development potential
- acting on the results of the appraisal process, for example, through promotion, reward and recognition, counselling, training, or in some cases, termination.
Performance objectives describe what is to be accomplished by the individual and/or the team or department over a defined period of time. These objectives need to be SMART (i.e. specific, measurable, achievable, realistic and time-based) and agreed.
The performance standards define the standard of performance required to achieve the objective.
The following characteristics will help ensure performance standards are fair and useful. The standards should:
- be based on work performance and objective outcomes
- differentiate between successful and unsuccessful workers
- accurately reflect performance and performance variations
- be measured by someone who is at least partially in control of the person whose performance is being appraised
- be based on observations which are documented and job-related
- recognise the realities of the work to be performed
- draw on a clear, well-written position description
- be aligned to the organisation’s strategic and operational objectives
- be agreed upon by all parties.
The performance standards set out the actions, behaviours or results to be achieved that are necessary for satisfactory performance.