Performance Appraisal, Objective Indexes

Production Measures

Employers are concerned that their employees are productive and efficient in performing their job duties. Production measures are often considered to be the gold standard of job performance indexes, because they are linked to an organization's profitability. They also usually have greater credibility than subjective performance indexes because they do not appear to rely on human judgments. The label objective suggests that the measures are accurate, unbiased, and reliable; but the label can be misleading.

Objective production measures exist for many jobs, especially those jobs in which tasks are wellstructured and frequently performed, such as the manufacture or assembly of established products or the provision of standard customer services. There are many possible production measures, some applicable to numerous jobs but others specific to a narrow range of jobs. Objective performance measures should be selected following a thorough job analysis that has identified the job's critical duties and responsibilities.

The most commonly used type of production measure is related to quantity of work, a count of the volume of work produced by employees. Specific examples are the number of lines of computer code written per hour by programmers, number of phone calls made per day by telemarketers, number of arrests per month made by police officers, percentage of standard time required to complete repairs by auto mechanics, and number of patent applications filed by research engineers.

Although also measuring work quantity, indexes that assess performance in sales jobs occur frequently and some specific examples are warranted. Most straightforward are simple indexes that count for some time period the number of sales of products or services or tabulate the value of such sales. More fine-grained sales measures include number of new customers, percentage of past customers who make new purchases, number of potential customers contacted, and sales of newly introduced versus older products or services.

Another type of production index assesses quality of work. These measures count the number of errors committed or assess the number of unacceptable or damaged items produced. Specific examples include the dollar value of scrapped raw material for manufacturing employees, number of shortages and overages in cash balances for bank tellers, errors by catalog sales clerks in processing customer orders, rate of errors for data entry personnel, and cost of dishes and glassware broken by restaurant servers.

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