Chapter 10 – Performance Management and Appraisal

1. Chapter 10 – Performance Management and Appraisal

2. PM: series of activities designed to ensure that the organization gets the performance it needs from its employees • Quantitative approach to provide practical measures of organizational effectiveness • Provides unified approach to dealing with individual career development • Links organizational strategy to ultimate results • Makes clear what the organization expects • Provides performance information to employees • Identifies areas of success and needed development • Documents performance for personnel records

3. Figure 10.1, page 321performance management linkage • Organizational strategies • Performance management • Employee performance • Performance management outcomes • Organizational results

4. Components of performance management, figure 10.2, page 322 • Developing and understanding corporate strategy • Identifying performance expectations • Providing performance direction • Encouraging employee participation • Assessing job performance • Conducting performance appraisals • And start back at identifying performance expectations

5. Global cultural differences in performance management – you can’t do the same thing in some countries like japan and china. Why? • Performance focused organizational cultures • Entitlement approach where adequate performance and stability are fine • Pay for performance – for students test scores, HISD

6. Performance driven organizational culture • Versus, performance driven organizational culture that focuses on results and contributions • 1. clear expectations, goals, and deadlines • 2. detailed appraisal of employee performance • 3. clear feedback on performance • 4. manager and employee training as needed • 5. consequences for performance

7. Identifying and measuring employee performance • Parts of job performance can be weighted! • Job duties identify the important elements of the job • Performance criteria • Quantify of output • Quality of output • Timeliness of output • Presence/attendance on the job • Efficiency of work completed • Effectiveness of work completed

8. Types of performance information • Trait based information: attitude, teamwork, initiative, effective communication, creativity, values, dispositions • Behavior based information: customer satisfaction, verbal persuasion, timeliness of response, citizenship/ethics • Results based information: sales volume, cost reduction, units produced, improved quality

9. Performance measurement criteria • If you leave out important job duties, it is DEFICIENT • Including irrelevant criteria, CONTAMINATES the measure • OVEREMPHASIS on one or two criteria measures is problematic

10. Performance standards define the expected levels of employee performance • Benchmarks, goals or targets are names given to expected levels • Should be clearly defined • In place before the work starts • Performance that is measured can be managed • Performance levels: think of it as when you went to K, you could not read much but by now, you read well and perform well • Superior • Intermediate • novice

11. Performance appraisals: employee rating, evaluation, review, results appraisal • Be courageous when evaluating someone • Two uses of appraisals: administrative role and development of individual • Administrative role: dismissal from work, disciplinary procedures, compensation adjustment, promotions/demotions, transfers • Developmental actions: career progression, training opportunities, coaching, mentoring, identifying strengths/weaknesses

12. Decisions about the performance appraisal process • Appraisal responsibilities • HR Unit: designs and maintains appraisal system, trains raters, tracks timely receipt of appraisals, reviews completed appraisals for consistency • Managers: rate performance of employees, prepare formal appraisal documents, review appraisals with employees, identify development areas

13. Informal versus systematic appraisal processes: • Informal appraisals occur whenever necessary, informal feedback • Systematic appraisals: formal contact between manager and employee to report managerial impressions and observations on employee performance • Timing of appraisals: once or twice per yea. • Probationary or introductory employees often get an appraisal after 60 or 90 days. • Make them fair or you might get sued or grieved

14. Who conducts appraisals? • Traditional : employee receives feedback, addresses issues and sets goals while manager reviews ratings, coaches and HR designs system and trains supervisors • Employee rating of managers: to identify competent managers, make managers more responsive to employees but managers often do not like their employees rating them, what is your opinion? Mine is, put your big girl “you know what the expression is”, ON • Team/peer rating: teams rate each other • Self rating • Outsider ratings • Multisource/360 degree feedback : employees often work in multidimensional roles and cross department, organization, and global boundaries so information is gathered from larger group to provide richer feedback

15. Tools for appraising performance • Category scaling methods: checklist and scale • Graphic rating scales: allows the rater to mark an employee’s performance on a continuum, THIS is BIG one to be USED, p. 340 and 341, figure 10.10 a and 10.11 • Behavioral rating scales: to address individual actions, see p. 342, figure 10.12 • What is the difference in graphic and behavioral?

16. Comparative methods: compare the performance levels of their employees against one another, to provide useful information for performance management. • Ranking: performance appraisals method in which all employees are listed from highest to lowest in performance • Forced distribution: performance appraisal method in which ratings of employees’ performance levels are distributed along a bell shaped curve, so you can identify high, average, and low performers

17. Narrative methods: written appraisal information • Critical incident: manager keeps written record of favorable and unfavorable actions by employee • Essay: manager must write short essay, so the manager needs to be a good writer, provides details on employee performance

18. Management by objective: performance appraisal method that specifies the performance goals that an individual and manager identify together. • First, job review and agreement: on exact makeup of job • Second, development of performance standards such as how many cars you must sell • Third, setting objectives that are attainable • Fourth, continuing performance discussions as needed • OR companies combine methods

19. Train managers to prevent Rater Errors, such as • Varying standards: don’t use different standards for employees in similar jobs • Recency effect: occurs when a rater gives greater weight to recent events when appraising an individual’s performance VERSUS • Primacy effect: occurs when a rater gives greater weight to information received first when appraising an individual’s performance • Central tendency errors: occurs when a rater gives all employees a score within a narrow range in the middle of the scale, everyone is average performer, NOT! • Leniency errors: occurs when ratings of all employees fall at the high end of the scale, Boss is TOOO NICE • Strictness errors: occurs when ratings of all employees fall at the low end of the scale, MEAN BOSS • Rater bias: occurs when a rater’s values or prejudices distort the rating • Halo effect: occurs when a rater scores an employee high on all job criteria because of performance in ONE area • Contrast error: tendency to rate people relative to others rather than against performance standards • Similar to me/different from me errors: are you like or different from the appraiser? • Sampling errors: appraiser has only seen small sample of employees work

20. APPRAISAL FEEDBACK • Appraisal interview: manager conveys praise and constructive criticism • Feedback as a system: data – factual pieces of information, evaluation - way the feedback system reacts to the facts, and actions – for feedback to cause change, some decisions must be made regarding feedback. • Reactions of managers: some don’ t like to give back negative feedback, affects future careers of employees but do a well done appraisal • Reactions of appraised employees: threat, win lose, but it SHOULD be meant to improve and develop employees • Effective performance management: consistent with the strategic mission of the organization, beneficial as a development tool, useful as an administrative tool, legal and job related, viewed as generally fair by employees, and effective in documenting employee performance