Understanding Performance Rating Scales in the Workplace and How to Use Them

According to this Gallup report, employees are 3.6x times more motivated to excel at their job when they receive regular and constructive feedback. In such a case, measuring employee performance and offering feedback is crucial for understanding the workforce and ensuring business objectives are achieved. Respectively, to get a grasp on performance, one should use proper performance rating scales for rating performance tools.

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Keeping all that in mind, let's take a closer look at performance rating scales, determine their different types, explore how to use a performance review rating scale effectively, and understand critical practices along with challenges that either promote or thwart the entire performance review process.

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Types of performance rating scales

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In short, performance rating scales are instruments for measuring employee performance. They are straightforward, and executive and management teams often use them during performance reviews. But one cannot say that the correct scale applies to any situation. That is why we need to consider three key instruments:

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1. Numeric scales
2. Descriptive scales
3. Behaviorally anchored rating scales (BARS)

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1. Numeric scales

A numeric performance rating scale measures employee performance using a numerical rate representing a certain indication of performance level. For instance, numeric performance review rating scales use a one to five or one to ten rate. In such a case, one represents a very poor performance, while ten is excellent. These customized rating scales can be based on different numerals depending on what you measure.

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2. Descriptive scales

With a descriptive performance review rating scale, you measure employee performance using descriptive statements. In such a case, performance ratings are represented through indications like "meets expectations," "exceeds expectations," and "below expectations." 

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3. Behaviorally anchored rating scales (BARS)

Finally, there are BARS. They represent a customized rating scale used in performance reviews and based on various employees' behavioral patterns. This approach entails using different narratives, incidents, and actions to fuel the employee rating scale with quantitative and qualitative data. Respectively, with BARS, you rate employee performance by comparing a person's behavior to a particular example of behavior categorized as good or bad.

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As a result, with the three types of performance rating scales above, you know where to start. Each employee rating scale mentioned is best applied in particular situations based on what you intend to measure. While numeric and descriptive approaches are more traditional performance ratings, BARS goes beyond most traditional performance ratings. 

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How to use performance rating scales effectively

You should know which performance rating scale to use when conducting performance reviews. For performance ratings to be effective, consider these aspects:

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• Communicating the performance rating scale and its purpose to employees under review
• Using the performance rating scale in a transparent and fair way
• Providing constructive and positive feedback to employees based on the data from employee ratings
• Employing a chosen performance rating scale as a part of a broader performance 

management system

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Following these principles increase the chances of a performance rating scale and a holistic performance management system to succeed and be effective, regardless of your chosen rating scale.

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Best practices for implementing performance rating scales

It is time to explore the top practices for successful performance rating scale implementation. In a nutshell, four best practices can help you make the most of any given rating scale.

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1. Involve employees in the development of the rating scale

This one is really simple. When designing a scale or choosing one, always involve your employees. They can offer valuable insights, making a performance review more accurate. Besides, being involved in the process grants a greater degree of trust and transparency in the overall process.

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2. Regularly review and update the rating scale as needed

Patterns of performance change, as well as the way people work. This is why you need to review and update the performance rating scale you choose regularly. Besides, you can compare the data from past reviews and ongoing ones to determine performance trends. With the insights at hand, it is easier to address performance gaps in time.

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3. Ensure that the performance rating scale accurately reflects the company's goals and values

Make sure a chosen performance rating scale mimics the company's mission, vision, goals, and values. If you choose a scale that does not reflect that, you will be left with information that you cannot adapt to your business scenario. Employee performance depends on the company's value, mission, and vision, which is why this practice is necessary.

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4. Provide training to managers on how to use performance rating scales effectively

Finally, a great performance review rating scale is a starting point. Your management and leadership need to know how to use it effectively. Always invest time and resources in training management teams to use a particular rating system for evaluating employee performance accurately. In such a case, you should take past performance reviews and established performance criteria as a foundation.

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Challenges and potential drawbacks of performance rating scales

With all the principles and practices for making rating scales effective at hand, there is one last thing left. Consider these potential challenges and downsides of performance rating scales:

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• There is a factor of the subjectivity of ratings, which can make final results less objective
• There is potential bias involved on the part of parties employing any given rating scale
• Ineffective rating scales can have an adverse impact on employees' morale and motivation

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Keep these challenges in mind, and address them in advance. Make sure the bias and subjectivity factors are eliminated by making ratings anonymous. Choose a rating scale carefully to avoid damaging employees' morale and motivation.

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Conclusion

Performance rating scales are a vital part of performance review strategies. Choose the right scale and follow the principles above to make it effective. Besides, consider the best practices and remember the challenges to ensure your scale works to improve employees' performance rather than decrease their morale.

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FAQs: Performance Rating Scales

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What are the five performance ratings?

The most common five performance ratings are the following:

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1. Unacceptable
2. Needs Improvement
3. Meets Expectations
4. Exceeds Expectations
5. Outstanding

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What are some performance rating scales?

In terms of various performance rating scales, these are the ones worth mentioning:

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• The five-point rating scale
• The four-point rating scale
• The ten-point rating scale
• Likert scale
• Alphabetic scale
• Goal status scale
• BARS
• Development scale

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What is the best rating scale for performance reviews?

It is hard to point out one particular performance review rating scale. However, if choosing among different candidates, it appears the five-point rating scale is the best one. Most organizations use it because the tool offers a balanced distribution of performance responses.

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What are performance scales?

Performance rating scales are tools for measuring performance based on pre-set criteria of a particular rating system.