Performance Appraisal

Performance Appraisal

Lynne S. Nemeth

Managing the performance of people is an important organizational strategy designed to exceed expectations of consumers in today’s competitive health care environment. Many complex processes and strategies are involved in managing employee behavior. Managers need to clearly define the roles and expectations that are needed in the variety of settings in which individuals provide their efforts in return for compensation. Active engagement by managers in the process of setting standards of performance motivates the staff they employ to achieve goals. By communicating the important issues that affect performance as well as the problem-solving issues that arise with the individual who may experience conflict or difficulty following established procedures, managers can provide a fair appraisal of the individual’s abilities, talents, and opportunities for improvement.


Performance is defined as the execution of an action; something accomplished; the fulfillment of a promise, claim, or request (, 2012).

Performance appraisal means evaluating the work of others. It is the process by which a manager examines and evaluates an employee’s work behavior by comparing it with preset standards, documents the results of the comparison and uses the results to provide feedback to the employee to show where improvements are needed and why (, 2012). The employee’s work is measured against standards, much like the quality improvement process. Standards, whether explicit or not, are applied to what ought to be or to what is superior, excellent, average, or unacceptable performance.

Peer review in nursing (defined in 1988 by the American Nurses Association and still applicable today) is the process by which nurses systematically evaluate the quality of nursing care provided by peers as measured against professional standards (American Nurses Association, 1988, p. 3).

Self-evaluation is the aspect of performance appraisal whereby employees do self-assessments of their own perceptions about their performance as compared with stated objectives and expectations.


Performance appraisal is a required process in organizations to help ensure that the quality of care is met and to provide a fair human resources management process. Performance appraisals provide staff members with the information necessary to determine whether they are meeting expectations or can improve their performance to the required level.

The process of performance appraisal includes assessing needs and setting goals, establishing objectives and time frames, assessing progress and evaluating performance, and then starting over again (Figure 23-1). At the start of a new job, core competencies (knowledge and skills) of the individual need to be evaluated. During the orientation program, progress should be tracked, and competence needs should be reassessed periodically throughout employment, at least annually.

Performance appraisal is a cyclical process that begins when the employee is hired and ends when the employee leaves. Job analysis identifies competencies required for job performance. The job description lists work standards and the knowledge, skills, and abilities necessary for the job. The performance appraisal specifies employee behaviors and compares job performance with criteria. A variety of measurement methods may be used to ensure that reliable and valid appraisals are conducted. Using the performance appraisal interview, goals are set, corrective action may be taken, or training needs may be identified. Thus meeting established “success criteria” would lead to equitable rewards and recognition that are objectively administered.

The performance appraisal process is both informal and formal. The informal process includes day-by-day supervision or coaching to moderate, modulate, or refine performance. Coaching as a management tool is ongoing, face-to-face collaboration and influence to improve skills and performance. By contrast, the formal performance appraisal should include written documentation and a formal interview with follow-up.

The employee’s work is measured against some standard for the purpose of determining the level of quality of the job performance. The guides to evaluation criteria include governmental standards such as Medicare/Medicaid regulations, professional standards published by the American Nurses Association or other specialty organizations, nursing care audits, client feedback in various forms, evidence-based guidelines, and departmentally developed standards. Organizational standards are more prevalent as systems undertake service and operational excellence initiatives to improve customer service, the employee experience, quality, financial performance, and growth. Organizational pillars to “hardwire excellence” provide a platform for all employees to understand and buy into the mission, vision, and values of the organization (Studer, 2003).

Ideally, a performance appraisal measures performance and motivates the person. However, performance appraisal is not the only or major source of motivation for most nurses. Measuring performance is not easy, and motivating someone else is an art. Cultural sensitivity is important to consider as the nursing workforce becomes more diversified (Smith-Trudeau, 2008). The performance appraisal process can create a lot of stress for individuals if it is not managed well by both the manager and the employee (Duncan, 2007). For example, job satisfaction and organizational commitment were found to be positively correlated to satisfaction with the feedback from performance appraisals (Jawahar, 2006). Integral components of a comprehensive performance appraisal system provide an overarching framework for the process. The tools and methods for a comprehensive performance appraisal system involve a clear determination of the abilities required for the position (job description); a match of the key requirements for the position with the individual’s capabilities (personnel selection); development of the abilities of the employee (staff development); and use of a motivational reward system to enhance employee performance (reward system). Box 23-1 outlines the key components of the performance appraisal process.

Performance attributes of an individual are determined by two elements: ability and motivation. Ability is made up of a collection of physical and mental capacities that enable a person to exhibit a skill or set of skills. Knowledge, experience, and skill form the ability to successfully complete a task (Hersey et al., 2008). Thus ability is an innate capacity that is molded by experience and training. Motivation is a willingness to work and a desire to achieve.


Given the national concerns about patient safety and quality of care, it is important to look at organizational culture as a factor influencing performance appraisal for change and improvement. The change of an error-prone health care system involves leadership and organizational learning, which requires significant strategic commitment and administrative direction. An environment that values and creates a shared vision and purpose can lead to reflection and learning, which then enables and strengthens organizational culture toward creative and effective solutions in health care delivery (Carroll & Edmondson, 2002).

Culture consists of shared norms, behaviors, and values. Schein (1992) defined the culture of a group as “a pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems” (p. 12). The learning that occurs within the system over time influences organizational culture.

The quality of care and the quality of work life are driven by the culture within a health care organization (Gershon et al., 2004). Culture is reflected in “the way things are done” in an organization (Stetler, 2003), and it surrounds all individuals and influences leadership. Characteristics of the culture are manifested differently in subgroups and by the various stakeholders within the organization, which warrants more in-depth assessment to fully understand.


Socialization of new members into an organization is an important way to learn the rules and norms of a group. New members need to learn the assumptions of the group, which are not always transparent. Group behaviors and perceptions may reveal some elements of the culture, and some of the rituals and processes undertaken within the organization may reflect the assumptions that are held. Groups that are stable and have a history of shared learning are likely to have developed some degree of culture, but groups with significant turnover of members and leaders may lack shared assumptions (Schein, 1992). Organizational culture has been referred to as the social glue that binds the organization, in which the deeper meanings of the way things are done in the organization are learned (Cameron & Quinn, 1999; Detert et al., 2000).

Evaluation of organizational culture needs to consider both the larger organization and the smaller unit within which a member belongs. Exploring the microsystem within a health care system reveals the unique disciplinary focus of each department and treatment setting (Donaldson & Mohr, 2000). The performance characteristics of academic departments, clinics, and hospital units and departments highlight the different functions and shared assumptions that members bring to the patient care setting. These varying perspectives enrich the mix of the organization by enabling diverse contributions, attitudes, and skills to be developed.

Members of a larger organizational culture may also belong to subcultures within that organization, whose group learning over time may have generated very different sets of basic assumptions. The behavior and language of organizational members are subject to interpretation through the cultural biases of the subgroup. Conflict may be experienced when members of the subculture do not understand the biases within the larger culture or vice versa. Using an organizational cultural approach to conflict management would enable subcultures to examine the assumptions that underlie the behavior and reinterpret such conflict as the result of diverse experiences. Problem-solving issues that are based on different assumptions, with the intent to evaluate the utility of such differences, demonstrate an effective learning process (Nemeth, 2008).

The criteria for performance appraisals should include measures of key performance indicators that reflect the values of the organizational culture. With these characteristics embedded within appraisal tools, managers can craft the culture within the unit. If there is not an explicit organizational mission, vision, or value statement, managers must translate their vision and values into a clear framework that all can understand. This framework should provide the structure for staff to operationalize the required behaviors for successful performance. The scoring of the performance appraisal tool indicates the weight that these organizational culture characteristics contribute toward performance, which communicates the importance of those to the overall appraisal.


The most direct goal of any performance appraisal system is the improvement of performance. Considering the process of performance appraisal systems, the outcome for the system should lead to positive organizational outcomes. Used effectively, the performance appraisal offers the opportunity for numerous organizational goals to be achieved. Box 23-2 provides an overview of the goals of the process of performance appraisal.

Roles and Expectations of Team Members

Numerous stakeholders are represented within the process of performance appraisal of nurses. Most important is the voice of the patient, the end consumer of the care provided. The patient’s voice can be obtained from patient satisfaction data that are formally used within the organization. Often, the patient or family member will offer direct verbatim comments that can be used to provide constructive support to individuals or groups. Nurse managers should seek out the comments of the patient regarding the patient’s experience of care. Through this proactive process, the manager may find that the voice of the patient regarding specific exceptional staff members or those who may need to improve can provide useful input for managing staff behavior.

The peers, who are co-workers in the setting in which the nursing care is delivered, are individuals who have the greatest opportunity to know firsthand how well the individual meets patient care needs and responsibilities as a member of the team. These peers may work on the same shift or alternate shifts or may interact with the individual from the perspective of another unit’s function. Experienced with direct communication about the patient’s status, they know the specific expectations of care that are required in the individual setting. For example, a nurse may work on a unit that receives patients frequently from the emergency department or the recovery room, and there are bilateral communications and expectations that these staff members have of one another. These are key individuals who interact with the nurse and may be in an excellent position to provide input related to performance.

The interdisciplinary team members who count on the nurse also have expectations for the nurse to communicate and collaborate regarding the plan of care and inform key members of the need to become involved in assisting the patient. For example, social workers or therapists may rely on referrals from the nurse who has made an initial assessment of the patient’s needs. If key criteria for referrals are clearly identified but not implemented, then the interdisciplinary care plan for the patient may not be developed as effectively as is needed. Interdisciplinary team members need to work together on behalf of the patient’s needs, not just within their own disciplinary silos. Nurse managers need to think about acquiring input from the perspective of the key interdisciplinary team members who provide services within the specific unit or department.

Physicians are valuable sources of feedback in the process for performance appraisal of staff. Effective clinical areas establish a collaborative and inclusive process guided by a strong base of supportive relationships. To develop this level of support requires mutual trust and respect among the physician teams that provide care within the specific area. This would include ongoing communication regarding opportunities for improved performance by staff and physicians alike.

Administrative members have expectations that are more global, but essentially they require that individual staff know the policies and procedures that must be implemented in the care of patients. The commitment of employees to organizational pillars of excellence is important to these stakeholders. With numerous stakeholders, it is important that systematic processes guide the nursing management function of performance appraisals. With data being collected systematically from numerous sources, a more meaningful performance appraisal process can be achieved.

Manager’s Role

Leaders who reward positive behavior and punish individuals who behave negatively in the workplace practice transactional leadership. By shifting toward a transformational style of leadership, organizational learning can occur from errors and system issues, and an empowered staff of nurses can work toward the innovations needed in the health care system (Wenberg, 2010).

Managers meet with newly hired employees during a planning stage to discuss the tasks, objectives, competencies, and performance characteristics. Clarity is essential in the performance appraisal process, and the manager has the duty to provide this to all staff members. This process allows the individual to talk specifically about his or her performance goals and to come to agreement with the manager on reasonable performance expectations.

Self-appraisal as an important component in the appraisal process and promotes individual input, personal responsibility, and feedback regarding job performance. Appraisal is a structured process of facilitated self-reflection, which allows individuals to review their professional activities comprehensively and to identify areas of real strength, professional goals, and needs for development (Conlon, 2003).

Managers who create a healthy work environment offer adequate time for feedback and input. Audit and feedback are important mechanisms to provide objective data to the nurse regarding the quality of care provided. To improve clinical practice and motivate nurses to learn, individual self-esteem must be at a level that promotes motivation (Ward, 2003). The imperative for nurse managers is to recognize that the use of feedback in the performance appraisal process may influence an individual’s self-esteem, which may affect practice. Providing feedback is a delicate art of nursing management, which should be performed with the goal of encouraging and motivating the individual to improve his or her individual care provision.

Aug 7, 2016 | Posted by in NURSING | Comments Off on Performance Appraisal

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