Performance Measures Criteria Criteria used to evaluate Performance Management Systems:

1. Performance Measures CriteriaCriteria used to evaluate Performance Management Systems: • Strategic Congruence • Extent to which performance mgt systems elicits job performance that is congruent with org strategy, goals and culture. • Critical Success Factors • Validity • Extent to which a performance measure assess all relevant aspects of performance • Not Deficient or Contaminated • Reliability • Consistency of a performance measure • 3 types: • Interrater – 2 individuals give the same evaluations of the person’s job performance • Internal Consistency • Test-retest reliability – reliability over time

2. Performance Measures CriteriaCriteria used to evaluate Performance Management Systems: 4. Acceptability • Refers to whether the people who use a performance measure accept it. • Based on “perceived fairness”: • Procedural – how it is done (ex. Employee participation on development of system) • Interpersonal fairness – feedback (timely and complete) • Outcome fairness – communication of outcomes (evaluation standards, expectations, rewards) 5. Specificity • Extent to which a performance measure tells employees what is expected of them and how they can meet these expectations.

3. Approaches to measuring performance

4. The Comparative Approach • Ranking • Simple Ranking • Alternation Ranking • Forced Distribution • Entails putting certain percentages of employees into predetermined categories • Forces managers to evaluate based on Job-related criteria rather than to be lenient. • Paired Comparison • Requires managers to compare every employee with every other employee in the work group • # of times employee gets favorable decision = Employee’s Performance Score Comparison of an individual’s performance with others Seeks to develop ranking of individuals within a group

5. The Comparative Approach Evaluating the Comparative Approach: • Effective tool in differentiating employee performance • Eliminates problems of liniency • Common failure to be linked with to strategic goals of the organization due to: • Subjective nature of ratings • Validity and reliability depend on raters themselves • Multiple evaluations can be done to reduce bias • Lacks Specificity (for feedback purposes) • Low Acceptability • employee performance related to employee in group/ team rather than measured against an absolute standard of excellence.