Performance Management

1. Introduction 2

2. Definition of concepts 2

2.1 Performance appraisal 2

2.2 Work engagement 4

2.3 Job satisfaction 4

3. Elements or characteristics of an effective performance appraisal system 6

3.1 Description of the five elements or characteristics of an effective appraisal system and the practical measures linked to them 6

4. Evaluation of the "effective performance appraisal systems" questionnaire 11

4.1 Elements revealed on the questionnaire 11

4.2 Elements not revealed on the questionnaire 12

5. Evaluating the companies we work for with the "effective performance appraisal systems questionnaire" 13

6. The link between the effectiveness of a performance appraisal system, work engagement, job satisfaction and intention to quit - A literature review 15

6.1 Link between the effectiveness of a performance appraisal system and work engagement 15

6.2 Link between the effectiveness of an appraisal system and job satisfaction 15

6.3 Link between the effectiveness of a performance appraisal system and intention to quit 16

7. The link between the effectiveness of a performance appraisal system, work engagement, job satisfaction and intention to quit - An empirical glance 17

8. Executive Summary 20

9. References 21

Annexure A: Performance appraisal system questionnaire

1. Introduction

The main aim of this assignment is to discuss performance appraisal system and its correlation with the attitudinal outcomes, viz: work engagement, job satisfaction and intention to quit. The focus of the initial part of the assignment is on the definitions of these four concepts and characteristics of an effective performance appraisal system. Furthermore, the "effective performance appraisal systems questionnaire" that has been completed by individual members of the study group is analysed based on the salient themes, pointing out problems with performance appraisal systems as well as the level of compliance in our environment.

Secondly, a literature review is conducted in order to find the link between the effectiveness of a performance appraisal, work engagement, job satisfaction and intention to quit. Here reference is made on our own group's levels of work engagement, job satisfaction and intention to quit in relation to the effectiveness of the performance appraisal system that the group is exposed to. Three charts drawn from the average scores obtained from every individual member of the group are plotted on the Y-axis (performance appraisal system) and X-axis (work engagement, job satisfaction and intention to quit). The individual performance appraisal systems scores on the Y-axis are then correlated with the corresponding outcomes on the X-axis. The trends depicted on each of the three charts are analysed in order to reveal the relationship between the Y-axis and the X-axis. The assignment is concluded with an executive summary which briefly outlines how the entire project was executed.

2. Definition of concepts

This section provides three definitions of each of the following four concepts based on the available literature: performance appraisal, work engagement, job satisfaction and intention to quit. A comprehensive definition of each of the concepts is provided at the end of the three definitions of each concept.

2.1 Performance appraisal

2.1.1 Performance appraisal: First definition/description

Performance appraisal is defined as a "method by which the job performance of an employee is evaluated, generally in terms of quality, quantity, cost and time" (Ahmed, Hussain, Ahmed & Akbar, 2010: 62).

2.1.2 Performance appraisal: Second definition/description

Other authors (Swanepoel, Erasmus & Schenk, 2008: 369) defines performance appraisal "as a formal and systematic process by means of which job relevant strengths and weaknesses are identified, observed, measured, recorded and developed", the primary purpose being to improve the individual performance of an employee.

2.1.3 Performance appraisal: Third definition/description

According to Gerber, Nel & Van Dyk (1998:169), "Performance appraisal system is defined as the process of identifying, measuring and developing human performance. Performance appraisal systems must not only accurately measure how well an employee is performing a job, but they must also contain mechanism for reinforcing strengths, identifying deficiencies and feeding such information back to employees so can improve such performance."

2.1.4 A comprehensive definition of performance appraisal

Performance appraisal can be defined as a process of evaluating an employee's job performance (Ahmed, et al., 2010) with the purpose of identifying, measuring and improving areas of employee's performance (Swanepoel, et al., 2008) that are linked to the attainment of organisational objectives. The evaluation is done in accordance with agreed standards. The results of the performance appraisal will provide a feedback related to where performance improvements are needed.

2.2 Work engagement

2.2.1 Work engagement: First definition/description

Michael, Christian, Garza & Slaughter (2011: 89) describe work engagement "as connoting high levels of personal investment in the work tasks performed on a job".

2.2.2 Work engagement: Second definition/description

De Lange, De Witte, & Notelaers (2008: 202) refers to work engagement as "a positive affective-motivational state of fulfilment that is characterized by vigour, dedication and absorption"

2.2.3 Work engagement: Third definition/description

Thirdly, Attridge (2009: 383) provided a slightly different and yet succinct definition of work engagement. According to Attridge, work engagement