There are many possible sources of errors in the performance appraisal process. Various types of rater errors are mentioned next:
Recency error
The recency effect occurs when a rater gives greater weight to recent events when appraising an individual’s performance. A recent good or bad action is more likely to be remembered by the rater.
Using some method of documenting both positive and negative performance can minimize this problem.
Central tendency error
Appraisers, who rate all employees within a narrow range, usually the middle or average, commit a central tendency error. It is the reluctance to make extreme ratings in either direction, the inability to distinguish between and among rates, and a form of range restriction.
Leniency error
Every evaluator has his value system, which acts as the standard against which appraisals are made. Some evaluators mark high and others low. The former is referred to as positive leniency error, and the latter as negative leniency error or strictness.
Halo effect
The halo effect occurs when a manager rates an employee high or low on all items because of one characteristic. For example, she is tall, so she is intelligent. This may not be true.
Contrast error
This error is the tendency to rate people relative to others rather than performance standards. People are heterogeneous. Two people may not be the same.
So it is essential to compare a person with the standard, not another person.
Similarity error
When evaluators rate other people in the same way that the evaluators perceive themselves, they are making a similarity error.
Based on evaluators’ perceptions, they project those perceptions onto others. You are an honest person; you expect others to be honest.
Personal bias
An appraisal is affected by the personal bias of the rater. If the rater has good relations with the ratee (an employee getting rated), he may give higher scores to the ratee, even though the ratee does not deserve such high scores.
So personal bias may lead to favored treatment for some employees and bad treatment for others. Students often complain against a few teachers against their personal biases. Distort the ratings those people receive.
Discrimination may occur in age, gender, religion, country of origin, etc.
For example, some HR departments have noticed that male supervisors give undeserved low ratings to women who hold traditionally male jobs.
Personal prejudice
A rater’s dislike for a group or class of people may distort the ratings those people receive. Discrimination may occur regarding age, gender, religion, and country of origin, etc.
For example, some HR departments have noticed that male supervisors give undeserved low ratings to women who hold traditionally male jobs.
Sometimes, raters are unaware of their prejudice, making such biases more difficult to overcome.
Paperwork
Some supervisors complain that performance appraisal is pointless paperwork. It does not serve any practical purpose. They complain because performance appraisal reports are often found only in the files.
In other words, performance appraisal reports are not used by some organizations. They are conducted just as a formality or for the namesake.
For example, in public universities, no extra reward or recognition is given for extraordinary performance.
Fear of Spoiling Relations
Performance appraisal may also affect superior-subordinate relations.
An appraisal makes the superior more of a judge than a coach. So, the subordinate may have a feeling of suspicion and mistrust about the superior.
Evaluate performance, not person
It should be noted that failure is an event and not a person. The rater should evaluate the performance, i.e., output, new ideas, extraordinary efforts, etc., and not the person. In reality, the person is evaluated and not his performance.
For example, a candidate’s family background and political affiliation are given more priority than merit while making personnel decisions.
Horn-effect
Sometimes the raters may evaluate based on one negative quality. This results in the overall lower rating of the particular employee.
For example, Karim does not shave regularly. Therefore, he must be lazy at work.
Spillover effect, in this case, the present performance is highly influenced by past performance. A person who has not done a good job in the past is considered bad for doing present work.