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© 2001 by Prentice Hall 7-1 7 Appraising and Managing Performance
© 2001 by Prentice Hall 7-2 Challenges Explain why performance appraisal is important and describe its components. Discuss the advantages and disadvantages of different performance rating systems. Manage the impact of rating errors and bias on performance appraisals. Discuss the potential role of emotion in performance appraisal and how to manage its impact. Identify the major legal requirements for appraisal. Use performance appraisals to manage and develop employee performance.
© 2001 by Prentice Hall 7-3 Performance Appraisal The identification, measurement, and management of human performance in organizations.
© 2001 by Prentice Hall 7-4 A Model of Performance Appraisal Identification Measurement Management
© 2001 by Prentice Hall 7-5 Dimension An aspect of performance that determines effective job performance.
© 2001 by Prentice Hall 7-6 The Benefits of Performance Appraisal Employer Perspective: Despite imperfect measurement techniques, individual differences in performance can make a difference to company performance. Documentation of performance appraisal and feedback may be needed for legal defense. Appraisal provides a rational basis for constructing a bonus or merit system. Appraisal dimensions and standards can help to implement strategic goals and clarify performance expectations. Providing individual feedback is part of the performance management process. Despite the traditional focus on the individual, appraisal criteria can include teamwork and the teams can be the focus of the appraisal.
© 2001 by Prentice Hall 7-7 The Benefits of Performance Appraisal (cont.) Employee Perspective: Performance feedback is needed and desired. Improvement in performance requires assessment. Fairness requires that differences in performance levels across workers be measured and have an effect on outcomes. Assessment and recognition of performance levels can motivate workers to improve their performance.
© 2001 by Prentice Hall 7-8 Measurement Tools The type of judgment that is required u Relative or absolute The focus of the measure u Trait, behavior, or outcome
© 2001 by Prentice Hall 7-9 Relative and Absolute Judgment An appraisal format that asks supervisors to compare an employee's performance to the performance of other employees doing the same job. Relative Judgment An appraisal format that asks supervisors to make judgments about an employee’s performance based solely on performance standards. Absolute Judgment
© 2001 by Prentice Hall 7-10 Trait Appraisal, Behavioral Appraisal, and Outcome Appraisal Instruments An appraisal tool that asks a supervisor to make judgments about worker characteristics that tend to be consistent and enduring. An appraisal tool that asks managers to assess a worker’s behaviors. An appraisal tool that asks managers to assess the results achieved by workers. Trait Appraisal Behavioral Appraisal Outcome Appraisal
© 2001 by Prentice Hall 7-11 Sample Trait Scales Rate each worker using the scales below. Decisiveness: 1 2 3 4 5 6 7 Very lowModerateVery high Reliability: 1 2 3 4 5 6 7 Very lowModerateVery high Energy: 1 2 3 4 5 6 7 Very lowModerateVery high Loyalty: 1 2 3 4 5 6 7 Very lowModerateVery high
© 2001 by Prentice Hall 7-12 Challenges to Effective Performance Measurement Rater errors and bias The influence of liking Organizational politics Whether to focus on the individual or the group Legal issues
© 2001 by Prentice Hall 7-13 Legal Issues A recent analysis of 295 court cases involving performance appraisal found judges’ decisions to be favorably influenced by the following additional factors: u Use of job analysis u Providing written instructions u Allowing employees to review appraisal results u Agreement among multiple raters (if more than one was used) u The presence of rater training
© 2001 by Prentice Hall 7-14 Communication Skills for the Appraisal Interview Nonverbal Attentive Open and Closed Questions Suggests interest and active listening. Appropriate use of open and closed questions can ensure an effective flow of communication during an interview. Rater sits with a slight forward, comfortable lean of the upper body, maintains eye contact, and speaks in a steady and soothing voice. —Open questions encourage information sharing and are most appropriate early in an interview or in complex, ambiguous situations. —Closed question evoke short responses and are useful for focusing and clarifying. While the ratee is speaking, the rater looks at the person and gently nods head to signal interest. — Open questions start with words like “Could,” “Would,” “How,” “What,” or “Why”. — Closed questions start with words like “Did,” “Is,” or “Are.” SkillsBenefit DescriptionExample
© 2001 by Prentice Hall 7-15 Communication Skills for the Appraisal Interview (Cont.) Paraphrasing Reflection of Feeling Paraphrasing can clarify and convey to the ratee that you are listening actively. Shows that you are trying to understand the emotional aspect of the workplace. The empathy and sensitivity of such reflection can open up communication and allow the interview to move more meaningfully to task- related issues. A paraphrase is a concise statement in your own words of what someone has just said. It should be factual and nonjudgmental. Similar to paraphrase, a reflection of feeling is a factual statement of the emotions you sense the other person is feeling. Be cautious about using this technique insincerely or with those who need professional help. You might begin by saying “If I have this right…” or “What you’re saying is…” and end with “Is that correct?” or “That’s what you are saying?” Start by saying something like “It sounds like you’re feeling…” End as you would a paraphrase (“Is that right?”). SkillsBenefit DescriptionExample
© 2001 by Prentice Hall 7-16 Communication Skills for the Appraisal Interview (Cont.) Cultural Sensitivity Communication is more effective when you are sensitive to the possible influence of cultural differences. Pay attention to cultural differences that may influence how another person communicates and how you might communicate with others. When dealing with employees from a culture that is highly formal, avoid addressing them in the workplace by their first names. Doing so may signal disrespect. SkillsBenefit DescriptionExample
© 2001 by Prentice Hall 7-17 Situational (System) Factors to Consider in Determining the Causes of Performance Problems Poor coordination of work activities among workers. Inadequate information or instructions needed to perform a job. Low-quality materials. Lack of necessary equipment. Inability to obtain raw materials, parts, or supplies. Inadequate financial resources. Poor supervision. Uncooperative coworkers and/or poor relations among people. Inadequate training. Insufficient time to produce the quantity or quality of work required. A poor work environment (for example, cold, hot, noisy, frequent interruptions.) Equipment breakdown.
© 2001 by Prentice Hall 7-18 How to Determine and Remedy Performance Shortfalls CauseQuestions to Ask Ability Effort Situation Possible Remedies Has the worker ever been able to perform adequately? Can others perform the job adequately, but not this worker? Is the worker’s performance level declining? Is performance lower on all tasks? Is performance erratic? Are performance problems showing up in all workers, even those who have adequate supplies and equipment? Train Transfer Redesign job Terminate Clarify linkage between performance and rewards Recognize good performance Streamline work process Clarify needs to suppliers Change suppliers Eliminate conflicting signals or demands Provide adequate tools
© 2001 by Prentice Hall 7-19 360° Feedback The combination of peer, subordinate, and self-review
© 2001 by Prentice Hall 7-20 Key Steps in Implementing 360° Appraisal Top management communicates the goals of and need for 360° appraisal. Employees and managers are involved in the development of the appraisal criteria and appraisal process. Employees are trained in how to give and receive feedback. Employees are informed of the nature of the 360° appraisal instrument and process. The 360° system undergoes pilot testing in one part of the organization. Management continuously reinforces the goals of the 360° appraisal and is ready to change the process when necessary.
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R OBERT L. M ATHIS J OHN H. J ACKSON PowerPoint Presentation by Charlie Cook The University of West Alabama Copyright © 2005 Thomson Business & Professional.
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