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    ch10 ch10 Presentation Transcript

    • Chapter 10 Establishing the Performance Management System Fundamentals of Human Resource Management Eighth Edition DeCenzo and Robbins
    • Introduction
      • Employees generally see performance evaluations as having a direct effect on their work lives.
      • The performance management systems need to include:
        • decisions about who should evaluate performance
        • what format should be used
        • how the results should be utilized
    • Performance Management Systems
      • Purposes of a Performance Management System
        • Feedback - let employees know how well they have done and allow for employee input.
        • Development – identify areas in which employees have deficiencies or weaknesses.
        • Documentation - to meet legal requirements.
    • Performance Management Systems
      • Difficulties in Performance Management Systems
        • Focus on the individual : Discussions of performance may elicit strong emotions and may generate conflicts when subordinates and supervisors do not agree.
    • Performance Management Systems
      • Difficulties in Performance Management Systems
        • Focus on the process : Company policies and procedures may present barriers to a properly functioning appraisal process.
        • Additionally, appraisers may be poorly trained.
    • Performance Management and EEO
      • HRM practices must be bias free, objective and job-related.
      • Valid performance appraisals are conducted at established intervals and are done by trained appraisers.
    • The Appraisal Process
    • The Appraisal Process
      • Establishment of performance standards
        • Derived from company’s strategic goals.
        • Based on job analysis and job description.
      • Communication of performance standards to employee.
    • The Appraisal Process
      • Measurement of performance using information from:
        • personal observation
        • statistical reports
        • oral reports
        • written reports
      • Comparison of actual performance with standards.
    • The Appraisal Process
      • Discussion of appraisal with employee.
      • Identification of corrective action where necessary.
        • Immediate action deals with symptoms.
        • Basic corrective action deals with causes.
    • Appraisal Methods
      • Three approaches:
      • Absolute standards
      • Relative standards
      • Objectives
    • Appraisal Methods
      • Evaluating absolute standards :
      • An employee’s performance is measured against established standards.
      • Evaluation is independent of any other employee.
    • Appraisal Methods
      • Evaluating absolute standards :
        • Essay Appraisal : Appraiser writes narrative describing employee performance & suggestions.
        • Critical Incident Appraisal : Based on key behavior anecdotes illustrating effective or ineffective job performance.
    • Appraisal Methods
      • Evaluating absolute standards :
        • Checklist Appraisal : Appraiser checks off behaviors that apply to the employee.
        • Adjective Rating Scale Appraisal : Appraiser rates employee on a number of job-related factors.
    • Appraisal Methods
      • Evaluating absolute standards :
        • Forced-Choice Appraisal: Appraisers choose from sets of statements which appear to be equally favorable, the statement which best describes the employee.
    • Appraisal Methods
      • Evaluating absolute standards :
      • Behaviorally Anchored Rating Scales (BARS): Appraiser rates employee on factors which are defined by behavioral descriptions illustrating various dimensions along each rating scale.
    • Appraisal Methods
      • Relative standards:
      • Employees are evaluated by comparing their performance to the performance of other employees.
    • Appraisal Methods
      • Relative standards:
      • Group Order Ranking : Employees are placed in a classification reflecting their relative performance, such as “top one-fifth.”
    • Appraisal Methods
      • Relative standards:
        • Individual Ranking : Employees are ranked from highest to lowest.
        • Paired Comparison :
          • Each individual is compared to every other.
          • Final ranking is based on number of times the individual is preferred member in a pair.
    • Appraisal Methods
      • Using Achieved Outcomes to Evaluate Employees
        • Management by Objectives (MBO)
        • includes mutual objective setting and evaluation based on the attainment of the specific objectives
    • Appraisal Methods
      • Using Achieved Outcomes to Evaluate Employees
        • Common elements in an MBO program are:
          • goal specificity
          • participative decision making
          • an explicit time period
          • performance feedback
        • Effectively increases employee performance and organizational productivity.
    • Factors that can Distort Appraisals
    • Factors that can Distort Appraisals
      • Leniency error
        • Each evaluator has his/her own value system.
        • Some evaluate high (positive leniency) and others, low (negative leniency).
      • Halo error : Evaluator lets an assessment of an individual on one trait influence evaluation on all traits.
    • Factors that can Distort Appraisals
      • Similarity error : Evaluator rates others in the same way that the evaluator perceives him or herself.
      • Low appraiser motivation : Evaluators may be reluctant to be accurate if important rewards for the employee depend on the results.
    • Factors that can Distort Appraisals
      • Central tendency : The reluctance to use the extremes of a rating scale and to adequately distinguish among employees being rated.
      • Inflationary pressures : Pressures for equality and fear of retribution for low ratings leads to less differentiation among rated employees.
      • Inappropriate substitutes for performance : Effort, enthusiasm, appearance, etc. are less relevant for some jobs than others.
    • Factors that can Distort Appraisals
      • Attribution Theory
      • Evaluations are affected based on whether someone’s performance is due to
        • internal factors they can control
        • external factors which they cannot
      • If poor performance is attributed to internal control, the judgment is harsher than when it is attributed to external control.
    • Factors that can Distort Appraisals
      • Impression management:
      • If employee positively influences the relationship with the supervisor, he/she is likely to receive a higher rating.
    • Creating More Effective Performance Management Systems
      • Use Behavior-Based Measures:
      • Measures based on specific descriptions of behavior are more job-related and elicit more inter-rater agreement than traits, such as “loyalty” or “friendliness”.
    • Creating More Effective Performance Management Systems
      • Combine Absolute and Relative Standards:
      • Absolute standards tend to be positively lenient; relative standards suffer when there is little variability.
      • Combining the standards tends to offset the weaknesses of each.
    • Creating More Effective Performance Management Systems
      • Provide Ongoing Feedback:
      • Expectations and disappointments should be shared with employees on a frequent basis.
    • Creating More Effective Performance Management Systems
      • Use Multiple Raters:
      • Increasing the number of raters leads to more reliable and valid ratings.
        • Use peer evaluations : Coworkers offer constructive insights and more specific evaluations.
        • Upward appraisals allow employees to give their managers feedback.
        • 360-Degree appraisals : Supervisors, peers, employees, team members, customers and others with relevant information evaluate the employee.
    • Creating More Effective Performance Management Systems
      • Rate Selectively
        • Appraisers only evaluate in those areas about which they have sufficient knowledge.
        • Appraisers should be organizationally as close as possible to the individual being evaluated.
        • More effective raters are asked to do the appraisals.
    • Creating More Effective Performance Management Systems
      • Train Appraisers:
      • Untrained appraisers who do poor appraisals can demoralize employees and increase legal liabilities.
    • Creating More Effective Performance Management Systems
    • International Performance Appraisal
      • Who performs the evaluation?
        • Different cultural perspectives and expectations between the parent and local country may make evaluation difficult.
        • Evaluation forms may not be translated accurately.
        • Quantitative measures may be misleading.
    • International Performance Appraisal
      • Evaluation Formats
        • May make sense to use different forms for parent-country nationals and host-country nationals.
        • Performance criteria for a particular position should be modified to fit the overseas position and site.
        • Include a current expatriate’s insights as part of the evaluation.