Chapter 11

© 2008 Thomson/South-Western All rights reserved.© 2008 Thomson/South-Western All rights reserved. PowerPoint Presentation by Charlie CookThe University of West Alabama

PowerPoint Presentation by Charlie CookThe University of West Alabama

CHAPTER 11CHAPTER 11

Performance Performance

Management and Management and

AppraisalAppraisal

CHAPTER 11CHAPTER 11

Performance Performance

Management and Management and

AppraisalAppraisalSection 3Section 3 Developing Human Resources Developing Human Resources

© 2008 Thomson/South-Western. All rights reserved. 11–2

The Nature of Performance The Nature of Performance ManagementManagement

Effective Performanc

e Managemen

t System

Make clear what the organization

expects

Provide performance

information to employees

Document performance for

personnel records

Identify areas of success and

needed development


Performance Management versus Performance Management versus Performance AppraisalPerformance Appraisal

Performance Management

Processes used to identify, encourage, measure,

evaluate, improve, and reward employee

performance

Performance Appraisal

The process of evaluating how well employees

perform their jobs and then communicating that information to the

employees


FIGURE 11-2 Components of a Performance-Focused Culture


Identifying and Measuring Identifying and Measuring Employee PerformanceEmployee Performance

Common Performan

ce Measures

Quantity of Output

Quality of Output

Timeliness of Output

Presence at Work


FIGURE 11-5 Conflicting Uses for Performance Appraisal


Legal Concerns and Performance Legal Concerns and Performance AppraisalsAppraisals

Legally Defensible Performance Appraisal System:

• Appraisal criteria based on job analysis (i.e., job-related)

• Absence of disparate impact and evidence of validity

• Formal evaluation criterion that limit managerial discretion

• Formal rating instrument linked to job duties and responsibilities

• Personal knowledge of and contact with ratee

• Training of supervisors in conducting appraisals

• Review process to prevent undue control of careers

• Counseling to help poor performers improve


Who Conducts Appraisals?Who Conducts Appraisals?

Supervisors rating their employees

Employees rating their superiors

Multisource, or 360°, feedback

Outside sources rating

employees

Team members rating each

other

Employees rating

themselves

Sources of Performance Appraisals


Employee Rating of ManagersEmployee Rating of Managers

Advantages Disadvantages

• Helps in identifying competent managers

• Serves to make managers more responsive to employees

• Contributes to the career development of managers

• Negative reactions by managers to ratings

• Subordinates’ fear of reprisals may inhibit them from giving realistic (negative) ratings

• Ratings are useful only for self-improvement purposes


Team/Peer RatingTeam/Peer Rating

Advantages Disadvantages

• Helps improve performance of lower-rated individuals

• Peers have opportunity to observe other peers

• Peer appraisals focus on individual contributions to teamwork and team performance

• Can negatively affect working relationships

• Can create difficulties for managers in determining individual performance

• Organizational use of individual performance appraisals can hinder the development of teamwork


FIGURE 11-8 Multisource Appraisal


Category Scaling MethodsCategory Scaling Methods• Graphic Rating ScaleGraphic Rating Scale

A scale that allows the rater to indicate an employee’s A scale that allows the rater to indicate an employee’s performance on a continuum of job behaviors.performance on a continuum of job behaviors.

Aspects of Performance Measured

Descriptive Categories

Job Duties

Behavioral Dimensions


Category Scaling MethodsCategory Scaling Methods

Graphic Rating Scale

Drawbacks

Restrictions on the range and type of rater responses

Differences in rater

interpretations of scale item

meanings and scale ranges

Poorly designed scales that

encourage rater errors

Rating form deficiencies limit effectiveness of

the appraisal


Category Scaling Methods (cont’d)Category Scaling Methods (cont’d)• Behaviorally Anchored Rating Scale (BARS)Behaviorally Anchored Rating Scale (BARS)

A rating scale composed of job dimensions (specific A rating scale composed of job dimensions (specific descriptions of important job behaviors) that “anchor” descriptions of important job behaviors) that “anchor” performance levels on the scale.performance levels on the scale.

• Developing a BARSDeveloping a BARS Identify important job dimensionsIdentify important job dimensions Write short statements of job behaviorsWrite short statements of job behaviors Assign statements (anchors) to job dimensionsAssign statements (anchors) to job dimensions Set scales for anchorsSet scales for anchors


FIGURE 11-10 Sample Terms for Defining Standards


FIGURE 11-11 Behaviorally-Anchored Rating Scale for Customer Service Skills


Comparative MethodsComparative Methods• RankingRanking

A listing of all employees from highest to lowest in A listing of all employees from highest to lowest in performance.performance.

DrawbacksDrawbacks

Does not show size of differences in performance Does not show size of differences in performance between employeesbetween employees

Implies that lowest-ranked employees are Implies that lowest-ranked employees are unsatisfactory performers.unsatisfactory performers.

Becomes an unwieldy process if the group to be Becomes an unwieldy process if the group to be ranked is large.ranked is large.


Comparative Methods (cont’d)Comparative Methods (cont’d)• Forced DistributionForced Distribution

Performance appraisal method in which ratings of Performance appraisal method in which ratings of employees are distributed along a bell-shaped curve.employees are distributed along a bell-shaped curve.

Advantages

• Helps deal with “rater inflation.

• Makes manages identify high, average, and low performers.

• Ensures that compensation increases reflect performance differences among individuals.

Disadvantages

• Managers resist placing people in the lowest or highest groups.

• Explanation for placement can be difficult.

• Performance may not follow normal distribution.

• Managers may make false distinctions between employees.


FIGURE 11-12 Forced Distribution on a Bell-Shaped Curve


Narrative MethodsNarrative Methods• Critical IncidentCritical Incident

Manager keeps a written record of highly favorable Manager keeps a written record of highly favorable and unfavorable employee actions.and unfavorable employee actions.

DrawbacksDrawbacks

Variations in how managers define a “critical Variations in how managers define a “critical incident”incident”

Time involved in documenting employee actionsTime involved in documenting employee actions

Most employee actions are not observed and may Most employee actions are not observed and may become different if observedbecome different if observed

Employee concerns about manager’s “black books”Employee concerns about manager’s “black books”


Narrative Methods (cont’d)Narrative Methods (cont’d)• EssayEssay

Manager writes a short essay describing an Manager writes a short essay describing an employee’s performance.employee’s performance.

DrawbackDrawbackDepends on the managers’ writing skills and their Depends on the managers’ writing skills and their

ability to express themselves.ability to express themselves.


Management by Objectives (MBO)Management by Objectives (MBO)• Management by ObjectivesManagement by Objectives

Specifying the performance goals that an individual Specifying the performance goals that an individual and his or her manager agree the employee will to try and his or her manager agree the employee will to try to attain within an appropriate length of time.to attain within an appropriate length of time.

• Key MBO IdeasKey MBO Ideas Employee involvement creates higher levels of Employee involvement creates higher levels of

commitment and performance.commitment and performance. Employees are encouraged to work effectively toward Employees are encouraged to work effectively toward

achieving desired results.achieving desired results. Performance measures should be measurable and Performance measures should be measurable and

should define results.should define results.


The MBO ProcessThe MBO Process

4. Continuing performance discussions

3. Setting of objectives

2. Development of performance

standards

1. Job review and agreement


FIGURE 11-14 Appraisal Interview Hints for Supervisors and Managers


Appraisal FeedbackAppraisal Feedback

Components of a Feedback System

Data on Actions

Data Evaluation

Action Based on Evaluation


Performance Management System Performance Management System (PMS)(PMS)

Consistent with the strategic

mission

Beneficial as a development

tool

Effectively documents

performance

Viewed as fair by employees

Useful as an administrative

tool

Is legal and job related

Effective Performance Management

System

Chapter 11

Business

Transcript of Chapter 11