Human Resource Management

"Subjective performance evaluation allows the use of a subtler, more balanced assessment of employee performance, and is typically used for more complex jobs where comprehensive objective measures are difficult to specify and/ or measure. Whilst often the only feasible method, the attendant problems with subjective performance evaluation have resulted in a variety of incentive structures and supervisory schemes. One problem, for example, is that supervisors may under-report performance in order to save on wages, if they are in some way residual claimants, or perhaps rewarded on the basis of cost savings. This tendency is of course to some extent offset by the danger of retaliation and/ or demotivation of the employee, if the supervisor is responsible for that employee’s output. ...
Another problem relates to what is known as the "compression of ratings". Two related influences—centrality bias, and leniency bias—have been documented ... The former results from supervisors being reluctant to distinguish critically between workers (perhaps for fear of destroying team spirit), while the latter derives from supervisors being averse to offering poor ratings to subordinates, especially where these ratings are used to determine pay, not least because bad evaluations may be demotivating rather than motivating. However, these biases introduce noise into the relationship between pay and effort, reducing the incentive effect of performance-related pay. ... this is the reason for the common separation of evaluations and pay, with evaluations primarily used to allocate training.
Finally, while the problem of compression of ratings originates on the supervisor-side, related effects occur when workers actively attempt to influence the appraisals supervisors give, either by influencing the performance information going to the supervisor: multitasking (focussing on the more visibly productive activities...), or by working “too hard” to signal worker quality or create a good impression...; or by influencing the evaluation of it, e.g., by "currying influence"... or by outright bribery..." [Principal–agent problem. Wikipedia]
The example "Person demotivated by evaluation - Fault tree analysis diagram" was created using the ConceptDraw PRO diagramming and vector drawing software extended with the Fault Tree Analysis Diagrams solution from the Engineering area of ConceptDraw Solution Park.

HR infographics "Components of competency based management" was redesigned from the Wikipedia file: Competency-circle.jpg. [en.wikipedia.org/ wiki/ File:Competency-circle.jpg]
This file is licensed under the Creative Commons Attribution-ShareAlike 3.0 License. [creativecommons.org/ licenses/ by-sa/ 3.0/ ]
"Competency-based human resources planning serves as a link between human resources management and the overall strategic plan of an organization. Competencies are defined as observable abilities, skills, knowledge, motivations or traits defined in terms of the behaviours needed for successful job performance.
Competency-based management supports the integration of human resources planning with business planning by allowing organizations to assess the current human resource capacity based on their competencies against the capacity needed to achieve the vision, mission and business goals of the organization. Targeted human resource strategies, plans and programs to address gaps (e.g., hiring and staffing; learning; career development; succession management; etc.) are then designed, developed and implemented to close the gaps." [Competency-based management. Wikipedia]
The HR infographics example "Components of competency based management" was created using the ConceptDraw PRO diagramming and vector drawing software extended with the HR Flowcharts solution from the Management area of ConceptDraw Solution Park.