How Performance Ratings Using the Average Method Are Calculated

Settings That Affect Average Rating Calculations

The factors that determine average rating calculations are the:

Rating models that are selected for each section and content item
Weighting, which is optional, and can vary between sections and content items

How Performance Ratings Are Calculated

In the average method, the application first calculates the average of the content item ratings to work out the section rating. The application then calculates the average of the section ratings to determine the overall rating. The application calculates ratings using precise values throughout the calculation process, and applies rounding at the end. Rounded values can appear in the performance document for the sections and overall ratings. The number of decimals displayed is determined in the performance template section.

Example: Average Method Without Weighting

ABC Company uses the same rating model for the Competencies, Performance Goals, and Overall Summary sections, with no weighting. The performance document contains no Development Goals section. The rating model has five levels in the scale, and the numeric values are 1, 2, 3, 4 and 5. Assume that all content items use the same rating model. The performance template is set up to use the standard rounding rule, and the overall rating is set to display to two decimal places. The mapping method is Nearest.

Assume the following performance template section configurations:

Decimal rounding rule is Standard
Decimal display is 2
Mapping metric is Numeric Rating
Mapping method is Nearest

The following table shows the ratings for the Competencies section.

Competency	Item Numeric Rating	Maximum Numeric Rating from Rating Model	Decimal Score (Item Rating/Maximum Rating)
Teamwork	4	5	0.8
Leadership	3	5	0.6
Communication	2	5	0.4
Analytical Skills	4	5	0.8
Ethics	5	5	1.0
Conceptual Thinking	4	5	0.8

The sum of the decimal scores is 4.4, from a possible maximum of 6.0. The 4.4 must be converted to a value on the rating model for the section. The section maximum numeric rating is 5, so the formula to calculate the section rating is:

(Total Decimal Score) / (Total Maximum Decimal Score) x (Maximum Numeric Rating from Section Rating Model), or in this example: (4.4 / 6) x 5 = 3.67.

In this example the calculated section rating for competencies is 3.67 out of 5, which maps to a numeric rating of 4.

The following table shows the ratings for the Performance Goals section.

Goal	Item Numeric Rating	Maximum Numeric Rating from Rating Model	Decimal Score (Item Rating / Maximum Rating)
Increase sales revenue	5	5	1.0
Cut expenses	3	5	0.6
Grow business in Asia	5	5	1.0
Participate in mentoring	5	5	1.0

The sum of the decimal scores is 3.6, from a possible maximum of 4.0. The 3.6 must be converted to a value on the rating model for the section, just as for the Competencies section. The section maximum numeric rating is 5, so using the same formula to calculate the section rating as for competencies, the section rating is: (3.6 / 4) x 5 = 4.5.

In this example the calculated section rating for goals is 4.5 out of 5, which maps to a numeric rating of 5.

To determine the overall rating, the application calculates the average numeric rating for the two sections. The overall rating calculation is: (4.0 + 5.0) / 2 = 4.5. The calculated overall rating maps to a numeric rating of 5.

Example: Average Method with Weighting

The following year, ABC Company uses the same rating model for the Competencies, Performance Goals, and Overall Summary sections as in the previous example. But, the company applies weights to the sections and individual content items. The weights determine the relative value of one section compared to another section, or content items to one another. Any content items that don't have weights are ignored in the calculations. The application validates that the:

Sum of the weights for content items within a section is 100.
Sum of the sections that contain content items (the Competencies and Performance Goals sections) within a performance document is also 100.

The following table shows the ratings for the Competencies section.

Competency	Item Numeric Rating	Maximum Numeric Rating from Rating Model	Decimal Score (Item Rating / Maximum Rating)	Weight	Weighted Score (Decimal Score x Weight)
Teamwork	4	5	0.8	35	28.0
Leadership	3	5	0.6	5	3.0
Communication	2	5	0.4	10	4.0
Analytical Skills	4	5	0.8	20	16.0
Ethics	5	5	1.0	10	10.0
Conceptual Thinking	4	5	0.8	20	16.0

The sum of the weighted scores is 77.0, from a possible maximum of 100.0. The 77.0 must be converted to a value on the rating model for the section. The section maximum numeric rating is 5, so the formula to calculate the section rating is:

(Weighted Score) / (Total Maximum Weighted Score) x (Maximum Numeric Rating from Section Rating Model), or in this example: (77.0 / 100.0) x 5 = 3.85.

In this example the calculated section rating for competencies is 3.85 out of 5, which maps to a numeric rating of 4.

The following table shows the ratings for the Performance Goals section.

Goal	Item Numeric Rating	Maximum Numeric Rating from Rating Model	Decimal Score (Item Rating / Maximum Rating)	Weight	Weighted Score (Decimal Score x Weight)
Increase sales revenue	5	5	1.0	30	30.0
Cut expenses	3	5	0.6	30	18.0
Grow business in Asia	5	5	1.0	25	25.0
Participate in mentoring	5	5	1.0	15	15.0

The sum of the weighted scores is 88.0, from a possible maximum of 100.0. The 88.0 must be converted to a value on the rating model for the section, just as for the Competencies section. The section maximum numeric rating is 5, so using the same formula to calculate the section rating as for competencies, the section rating is: (88.0 / 100.0) x 5 = 4.40.

In this example the calculated section rating for performance goals is 4.40 out of 5, which maps to a numeric rating of 4.

To determine the overall rating, the application calculates the sum of the numeric ratings for the two weighted sections, then converts the score to the rating model scale. ABC sets the Competencies section weight to 40, and the Performance Goals section weight to 60. First, the application calculates the decimal scores of the weighted sections:

Competencies: 4 / 5 = 0.8
Performance Goals: 4 / 5 = 0.8

The application then calculates the weighted scores for each section, and adds them together. The total weighted scores are out of a possible 100.0 points:

Competencies: 0.8 x 40 = 32.0
Performance Goals: 0.8 x 60 = 48.0
Total Competencies and Performance Goals: 32.0 + 48.0 = 80.0

The application converts the scores to the rating model scale to determine the overall rating: (80.0 / 100.0) x 5 = 4.0, which maps to a numeric rating of 4.

Example: Average Method with Weighting and Rating Model Variations

For a performance evaluation for a specific project, ABC Company uses various rating models for the Competencies, Performance Goals, and Overall Summary sections. The performance document contains no Development Goals section. The application applies the maximum numeric rating from each rating model to calculate the scores. Different weights are also applied to the content items. Section weights are also applied. The performance template is set up to use the standard rounding rule, and the overall rating is set to display to two decimal places. The mapping method is Nearest.

Assume the following performance template section configurations:

Section weights are applied
Different weights are applied to the content items
Decimal rounding rule is Standard
Decimal display is 2
Mapping metric is Numeric Rating
Mapping method is Nearest

The following table shows the ratings for the Competencies section, which uses different rating models with different maximum ratings for the individual competencies. The section rating model differs from those used for the individual competencies, and the rating model maximum numeric rating is 7.

Competency	Item Numeric Rating	Maximum Numeric Rating from Rating Model	Decimal Score (Item Rating / Maximum Rating)	Weight	Weighted Score (Decimal Score x Weight)
Teamwork	4	5	0.8	35	28.0
Leadership	3	3	1.0	5	5.0
Communication	2	4	0.5	10	5.0
Analytical Skills	4	5	0.8	20	16.0
Ethics	5	5	1.0	10	10.0
Conceptual Thinking	4	4	1.0	20	16.0

The sum of the weighted scores is 84.0, from a possible maximum of 100.0. The 84.0 must be converted to a value on the rating model for the section. The section maximum numeric rating is 7, so the formula to calculate the section rating is:

(Weighted Score) / (Total Maximum Weighted Score) x (Maximum Numeric Rating from Section Rating Model), or in this example: (84.0 / 100.0) x 7 = 5.88.

In this example the calculated section rating for competencies is 5.88 out of 7, which maps to the numeric rating 6.

The following table shows the ratings for the Performance Goals section. The Performance Goals section itself uses a rating model with a maximum rating of 6.

Goal	Item Numeric Rating	Maximum Numeric Rating from Rating Model	Decimal Score (Item Rating / Maximum Rating)	Weight	Weighted Score (Decimal Score x Weight)
Increase sales revenue	5	5	1.00	30	30.0
Cut expenses	3	5	0.60	30	18.0
Grow business in Asia	4	5	0.80	25	20.0
Participate in mentoring	4	5	0.80	15	10.0

The sum of the weighted scores is 78.0, from a possible maximum of 100.0. Because the maximum for the section rating model is 6, the section rating is: (78.0 / 100.0) x 6 = 4.68, which maps to the numeric rating of 5.

To determine the overall rating, the application calculates the sum of the numeric ratings for the two weighted sections, then converts the score to the rating model scale. ABC sets the Competencies section weight to 40, and the Performance Goals section weight to 60. The overall summary section uses a rating model with a maximum score of 9.

First, the application calculates the decimal scores of the weighted sections:

Competencies: 6 / 7 = 0.85
Performance Goals: 5 / 6 = 0.83

The application then calculates the weighted scores for each section, then adds them together. The section weight for the Competencies section is 40, and for the Performance Goals section it's 60. The total weighted scores are out of a possible 100.0 points:

Competencies: 0.85 x 40 = 34.0
Performance Goals: 0.83 x 60 = 49.8
Total Competencies and Performance Goals: 34.0 + 49.8 = 83.8

The application converts the scores to the rating model scale to determine the overall rating: (83.8 / 100.0) x 9 = 7.542. When the rounding rules and decimal places are applied, overall rating is 7.54, which maps to the section numeric rating 8.