It is the oldest and simplest formal systematic method of performance appraisal in which employee is compared with all others for the purpose of placing order of worth. The employees are ranked from the highest to the lowest or from the best to the worst.
In doing this the employee who is the highest on the characteristic being measured and also the one who is L lowest, are indicated. Then, the next highest and the next lowest between next highest and lowest until all the employees to be rated have been ranked. Thus, if there are ten employees to be appraised, there will be ten ranks from 1 to 10.
However, the greatest limitations of this appraisal method are that:
(i) It does not tell that how much better or worse one is than another,
(ii) The task of ranking individuals is difficult when a large number of employees are rated, and
(iii) It is very difficult to compare one individual with others having varying behavioural traits. To remedy these defects, the paired comparison method of perfor¬mance appraisal has been evolved.
In this method, each employee is compared with other employees on one- on one basis, usually based on one trait only. The rater is provided with a bunch of slips each coining pair of names, the rater puts a tick mark against the employee whom he insiders the better of the two. The number of times this employee is compared as better with others determines his or her final ranking.
The number of possible pairs for a given number of employees is ascertained by the following formula:
Where N = the total number of employees to be evaluated. Let this be exemplified with an imaginary example.
If the following five teachers have to be evaluated by the Vice Chanceller of a University:
(K), Mohapatra (M Raul (R), Venkat (V), and Barman (B), the above formula gives 5 (5 -1) / 2 or 10 pairs.