2Performers Appraisal Learning Objectives Explain Purposes of Performance ManagementIdentify Success Factors in Good ProgramsIdentify Sources of Information for EvaluationExplain Key Methods used in Managing PerformanceOutline the Manager/Sub-Ordinate Interview
3Purpose of Performance Appraisal Systems Goal: Maintain Organizational ProductivityResults: Organization Productivity Individual PerformanceMethods: Individual Performance Goals
4Objectives Opportunity to Regularly Discuss Results Supervisor Identifies Strengths and WeaknessesFair and Equitable FormatBasis for Salary/Promotion Recommendations
5Main Purposes of Performance Management Individual Rewards (Base and Incentive)Feedback for Sub-Ordinate (Plus and Minus)Recognition of Superior PerformanceDocumentation of Weak PerformancePersonnel Decision-MakingFuture Goal Commitments (Planned Achievements)
6Reasons for Appraisals Compensation "Pay for Performance"Job Performance ImprovementsFeedback to SubordinatesDocumentation for DecisionsGoal Setting - Later EvaluationPromotion DecisionsIdentify Training NeedsHR Planning
7Primary Uses of Performance Appraisals Small OrganizationsLarge OrganizationsAll OrganizationsCompensation80.2%66.7%74.9%Performance improvement46.3%53.3%48.4%Feedback40.3%40.6%40.4%Documentation29.0%32.2%30.2%Promotion26.1%22.8%24.8%Training5.1%9.4%7.3%Transfer8.1%6.1%Discharge4.9%6.7%5.6%Layoff2.1%2.8%2.4%Personnel research1.8%2.2%Manpower planning0.7%1.5%
8Trends in Managing Performance Appraising/EvaluatingVERSUSManaging PerformanceSuperior Performance leads to Superior RewardsIssue: How to objectively measure specific goals!
9Who Performs the Appraisal? Immediate SupervisorHigher ManagementSelf-AppraisalsPeers (Co-Workers)Evaluation TeamsCustomers“360° Appraisals”
10Supervisor AppraisalPerformance appraisal done by an employee’s manager and often reviewed by a manager one level higher.
11Self-AppraisalPerformance appraisal done by the employee being evaluated, generally on an appraisal form completed by the employee prior to the performance review.
12Subordinate Appraisal Performance appraisal of a superior by an employee, which is more appropriate for developmental than for administrative purposes.
13Peer AppraisalPerformance appraisal done by one’s fellow employees, generally on forms that are complied into a single profile for use in the performance interview conducted by the employee’s manager.
14Team AppraisalPerformance appraisal, based on TQM concepts, that recognizes team accomplishment rather than individual performance.
18Rating Errors Issues Carefully Developed Behavior Descriptions Fair Evaluation ScalesFactor Relatedness to the Job
19Types of Rating Errors Leniency/Strictness Error Central Tendency Define Anchors (Dimensions)Force A CurveCentral TendencyReluctant to Give High/LowExplain Need for VariabilityRecency ErrorLast Action HaloEncourage Frequent Evaluation
20Error of Central Tendency Performance-rating error in which all employees are rated about average.
21Leniency or Strictness Error Performance-rating error in which the appraiser tends to give employees either unusually high or unusually low ratings.
22Recency ErrorPerformance-rating error in which the appraisal is based largely on the employee’s most recent behavior rather than on behavior throughout the appraisal period.
23Rating Errors Example Halo Leniency Central Tendency Recency Bias Job Rating ScaleEXCELLENTon all factorsLeniencyEmployee AEmployee BEmployee CSUPERIORJob Rating Scale Employee DCentral TendencyJob Rating Scale Employee AAVERAGEJob Rating Scale Employee BJob Rating Scale Employee CRecency BiasJob rating scale behavior during the last month has been POOR.
24Similar-To-Me ErrorPerformance-rating error in which an appraiser inflates the evaluation of an employee because of a mutual personal connection.
25Appraisal Training Programs Needs Explain ObjectivesReview the InstrumentDefine the Performance StandardsUnderstand Typical Subjective ErrorsTeach Interviewing Skills
26Scheduling the Performance Appraisal Schedule the review and notify the employee ten days or two weeks in advance.Ask the employee to prepare for the session by reviewing his or her performance, job objectives, and development goals.Clearly state that this will be the formal annual performance appraisal.
27Preparing for the Review for the Performance Appraisal Review the performance documentation collected throughout the year. Concentrate on work patterns that have developed.Be prepared to give specific examples of above- or below-average performance.When performance falls short of expectations, determine what changes need to be made. If performance meets or exceeds expectations, discuss this and plan how to reinforce it.After the appraisal is written, set it aside for a few days and then review it again.Follow whatever steps are required by your organization’s performance appraisal system.
28Appraisal Interviews Schedule the interview 10 to 14 days in advance. Provide subordinates with a “guide” to follow in planning for the interview.Consider which of the following approaches to use:Tell-and-sell methodTell-and-listen methodProblem-solving method (generally preferable)
29Tell-and-Sell Interviews Supervisor persuades employee to change in a prescribed way.Employees sees how changed behavior will be of great benefit.
30Tell-and-Listen Interviews Supervisor covers strengths/weaknesses for first halfSolicits employee’s feelings about commentsDeal with disagreement, non-defensivelyNegotiate future concrete objectives
31The Problem Solving Interview Discuss strengths and weaknesses since last reviewExplore feelings of sub-ordinateListening, accepting, and responding are essentialStimulate growth (performance) jobDiscuss problems, needs, innovations, satisfactions and dissatisfactions since last reviewListen and respond with goal of helping person and productivity.
32Appraisal Interviews During the Interview: Techniques: Emphasize strengths to build on.Suggest more acceptable ways of acting.Concentrate on present opportunities for growth.Techniques:Listen more than you talk.Use a variety of types of questions.Avoid the sandwich technique.
33Establishing Job Related Performance Standards RelevantFree From ContaminationReliable - Inter Rater Consistency
34Appraisal Program Failure Concerns Little Benefit Relative to Time CommitmentFace to Face ConfrontationUnskilled AppraisersRole Conflict: Judge or Teacher
35Appraisal Methods Rating Scales Essay Management by Objectives Check Lists by Key WordsForced Choice StatementsRanking of Employees
36Rating Scale Methods (most popular) (Check each trait being evaluated)Global Scale (Total Performance)Mixed Standard Scale (Choose from Different Statements)Behaviorally Anchored Rating Scale (Descriptions along the scale to define)
37Behaviorally Anchored Rating Scale (BARS) A behavioral approach to performance appraisal that consists of a series of vertical scales, one for each important dimension of job performance.
46Critical IncidentUnusual event that denotes superior or inferior employee performance in some part of the job.
47Management By Objective (MBO) Philosophy of management that rates performance on the basis of employee achievement of goals set by mutual agreement of employee and manager.
48Management by Objectives (Peter Drucker) Integrates performance and goal settingFrequent intervalsRecord maintenanceObjective review jointlyMutual buy-in
49Advantages of MBO Employees Can Measure Performance Quantifiable Goals Joint EffortEmployee Satisfaction in Participation
50Disadvantages of MBO Success Not Validates by Research Studies Easy to Set Unrealistic GoalsHard to Get Full Commitment to ProcessDifficult to Define Some Goals
51Performance Appraisal Interview Needs Trained Interview TechniquesHonesty in AppraisalWell Planned StructureCarefully ConductedFeedback OpennessAdequate Time (more than one session occasionally)
52Procedural Guidelines Listen More Than Talk (1/3 rule)Vary the Questions (Open ended/elaboration)Follow-up Questions (force through responses)Reflect Feelings (clarify-sincerity)Avoid Sandwich Technique (Positive-Negative-Positive)Why? Signals Bad NewsNo More Bad NewsDiscourages Real Communication
53Measuring Performance Periodic review periods providing feedback on interim results measured against established goalsJoint agreement on subordinate goals and measuresDepartment-specific goals Measures of department performanceOrganization’s common goals Measures of organization performanceSupervisor lists goals and measures for subordinateSubordinate proposes goals and measures for his or her jobFinal review of subordinate results measured against esta-blished or revised goalsNew inputs providedInappropriate goals eliminated