Leading, Motivating and Evaluating Employees

Leading, Motivating and Evaluating Employees
Strategic Business Planning for Commercial Producers Human Resources Leading, Motivating and Evaluating Employees Bernard L. Erven Department of Agricultural, Environmental and Development Economics Ohio State University © Purdue University, Center for Food and Agricultural Business, 2002

A paradigm about employees:
Strategic Business Planning for Commercial Producers Human Resources A paradigm about employees: You can buy people’s time; you can buy their physical presence at a given place; you can even buy a measured number of their skilled muscular motions per hour. But you cannot buy the devotion of their hearts, minds, or souls. You must earn these. Introduce the topics of leading, motivating and evaluating employees by emphasizing that managers get things done through people. Managers’ paradigms about employees can greatly affect how they relate to them, gain their confidence and make them an integral part of the business. © Purdue University, Center for Food and Agricultural Business, 2002

Strategic Business Planning for Commercial Producers
Human Resources A paradigm about jobs: Fall in love with your job and keep the romance alive. Sure, your employer will benefit if you’re committed but not as much as you will. High job commitment is a gift you should give yourself. The paradigms employees have about their jobs affects their performance. This paradigm makes one’s job an opportunity rather than an obligation. It is a paradigm employers can subtly teach to their employees. © Purdue University, Center for Food and Agricultural Business, 2002

The top manager’s perspective
Strategic Business Planning for Commercial Producers Human Resources The top manager’s perspective Job analysis Duties and responsibilities Job descriptions Mission Goals Tactics Tasks Top managers of a farm start with a mission for their business. This mission leads to goals and tactics. Tactics dictate the tasks that need to be done. Through job analysis, tasks are combined into categories of duties and responsibilities. These categories become the heart of job descriptions. Emphasize that job descriptions without critical duties and responsibilities assure that the organization’s mission will not be accomplished. © Purdue University, Center for Food and Agricultural Business, 2002

Human resource management success
Strategic Business Planning for Commercial Producers Human Resources Human resource management success Success comes from attracting, developing, and maintaining an effective workforce. Our focus is just three of several HRM activities: leading, motivating, and evaluating. Attracting, developing, and maintaining an effective workforce requires the following activities in addition to leading, motivating, and evaluating: HRM planning Job analysis Recruitment Hiring Orienting Training Communication Compensation Discipline © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Leading employees Leadership is influencing people’s behavior through: Communicating Enabling others to act Modeling the way Disciplining Encouraging the heart Motivating Supervisors need to accept that their actions or inactions influences the behavior of employees. The success or failure of employees, therefore, is a direct reflection on the effectiveness of their supervisors. To illustrate, failure to discipline an errant employee sends the signal that not following the rules is okay. Disciplining unfairly sends the signal that arbitrariness is acceptable. This frustrates employees’ attempts to understand the environment in which they are working and to forecast the consequences of their own decisions and behaviors. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Why do managers lead? Help employees accomplish their own career and personal goals. Help accomplish the farm’s mission and goals. Managers are responsible for more than the farm. They play an important role in helping employees satisfying their individual career and personal goals. The importance of this point is emphasized by listing employee goals before farm goals. © Purdue University, Center for Food and Agricultural Business, 2002

Leaders have power through their:
Strategic Business Planning for Commercial Producers Human Resources Leaders have power through their: Positions Ability to reward Coercion Expertise Personal appeal and charisma To lead, supervisors must have power. There are multiple sources of power. The title that a supervisor received from occupying a position may be much less important to employees than the other sources of power. © Purdue University, Center for Food and Agricultural Business, 2002

Should I be autocratic or democratic?
Strategic Business Planning for Commercial Producers Human Resources Should I be autocratic or democratic? The wrong question about leadership style Each supervisor makes decisions about his or her leadership style. This question offers two misleading suggestions: There are only two leadership styles. A supervisor must choose one or the other. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources The right question: What combination of directive behavior and supportive behavior, i.e., leadership style, should I use with an employee given his or her knowledge, skills, abilities, experience, self-esteem, self-confidence and commitment? Here is the right question about choice of a leadership style. It suggests that leadership style is an employee by employee choice. This question focuses attention on the employee’s characteristics, not the employer’s preferences. The question also suggests that leadership style is a combination of directive behavior and supportive behavior. Directive behavior emphasizes control and direct supervision. Supportive behavior emphasizes support, encouragement and delegation. © Purdue University, Center for Food and Agricultural Business, 2002

Four basic leadership styles
Strategic Business Planning for Commercial Producers Human Resources Four basic leadership styles Directing Control with close supervision Coaching Explain, seek input and stay in control Supporting Support without controlling Delegating Turn over authority and responsibility Leaders have four leadership styles from which to choose. Each style is defined by a combination of the leader’s behaviors. This approach to leadership is called situational leadership. Close this section of the discussion by emphasizing that the situational leader is flexible because he or she adjusts to the people being led. An essential leadership skill is being able to judge employee’s knowledge, skills, abilities, experience, self-esteem, self-confidence and commitment. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Motivating employees Motivation is the inner force that drives employee behavior We start with a definition. The definition appears simple but the issues for managers are very complex. © Purdue University, Center for Food and Agricultural Business, 2002

Some background points on motivation:
Strategic Business Planning for Commercial Producers Human Resources Some background points on motivation: Most employees prefer to be motivated. What one person finds motivating another may find boring, frustrating and debilitating. Self-motivation plays a crucial role. An unmotivated person can become motivated and vice versa. Motivation does not explain all performance problems. Most employees prefer to be motivated. Why would an employee choose the frustration of not being motivated? What one person finds motivating another may find boring, frustrating and debilitating. This builds on our discussion of situational leadership. Supervisors do not have the luxury of a homogeneous group of people to lead and motivate. Self motivation plays a crucial role. Achievers tend to continue achieving. Past accomplishments, challenging career goals, expertise in one or more areas, pride in one’s abilities and self-confidence contribute to self-motivation. An unmotivated person can become motivated. On the other hand, a motivated person can lose motivation. This means that motivation of employees, even the same employee, is a never ending challenge for a supervisor. Not all performance problems are explained by lack of motivation. Lack of training can prevent a motivated employee from performing well. Lack of needed supplies, equipment, and sufficient time can also cause performance problems. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources The simplest and most intuitive approach to motivation is to satisfy an employee’s needs. This approach has four parts: Employees have needs that they desire to satisfy, which in turn Leads to actions that will fulfill their needs, which in turn Leads to rewards from the employer and satisfaction from doing the job, which in turn Reinforces their actions and causes them to be repeated. This simple model is a helpful beginning point because it places the emphasis on employees and their needs. Note the importance of: The “right” rewards, called positive reinforcements, reinforce actions of employees thus causing them to repeat the actions to get the rewards again. The necessity of an employee being willing and able to perform the assigned tasks. The practical difficulties of applying this model without the employee’s involvement and cooperation. The necessity of identifying needs. There is always the possibility that a person’s job may not satisfy his or her needs. The result, not surprisingly, is the near impossibility of motivating some employees. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Fundamental argument drawn from this simple needs/reinforcement model of motivation: Employee motivation works best as a partnership between employer and employee. This argument extends the simple and intuitive model of motivation based on needs. It gives responsibility to both employers and employees. © Purdue University, Center for Food and Agricultural Business, 2002

The employee’s contributions to the motivation partnership
Strategic Business Planning for Commercial Producers Human Resources The employee’s contributions to the motivation partnership Be self-motivated. Search for the “right” job and work environment. Be willing to learn. Commit to the organization’s vision, mission, core values and goals. Communicate needs, concerns and ideas to the employer. Listen to the employer’s point of view. Employees unwilling to make these contributions are saying that they take less than ideal responsibility for their own motivation. © Purdue University, Center for Food and Agricultural Business, 2002

The employer’s contributions to the motivation partnership
Strategic Business Planning for Commercial Producers Human Resources The employer’s contributions to the motivation partnership Remove employee dissatisfiers such as poor working conditions, unsafe equipment, exhausting physical work combined with excessively long work days and weeks, unfair pay, disagreeable supervisors, unreasonable rules and policies, unchallenging work, obnoxious co-workers and conflict with co-workers. Dissatisfiers get in the way of a person becoming motivated. These dissatisfiers are under the control of the employer not the employee. Employers leaving dissatisfiers in place fail to give motivators a chance to work. Motivation problems result no matter what the characteristics of employees may be. © Purdue University, Center for Food and Agricultural Business, 2002

Employer’s contributions (continued)
Strategic Business Planning for Commercial Producers Human Resources Employer’s contributions (continued) Put motivators in place, e.g., opportunity to achieve, recognition, satisfying work, responsibility and personal growth through training and new experiences. Promote communication to discover the dissatisfiers and the effectiveness of motivators. Motivators are ineffective until the dissatisfiers are removed. To illustrate, employees working in unsafe conditions with unfair pay will not be motivated by recognition and delegation of additional responsibility. The list of motivators is suggestive rather than exhaustive. Note that money can play a role in motivation because it can be one form of recognition. Communication with employees is essential. What is a dissatisfier for one employee may not be a dissatisfier for another. Supervisors need to make the distinctions employee by employee. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Evaluating employees “How am I doing?” “How can I do better?” Most employees want an answer to these questions. Employee performance reviews should be designed to answer the “how am I doing?” and “how can I do better?” questions for each employee on a continuous basis. The purpose of this opening slide is to get participants’ attention. There is often a huge gap between what employees want to know and what they do know. Ironically, it is the best performing employees who most want to be told how they are doing. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Feedback helps: Improve employee performance. Decrease turnover. Motivate self-improvement. Build trust. Prevent litigation. Create a paper trail useful in litigation. These are important benefits from doing employee evaluations. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Eight questions guide employers’ development of effective employee reviews What are my objectives for employee performance reviews? Whom will be reviewed? What will be the mix of individual and group reviews? Will the reviews be formal or informal? What will be the mix of objective and subjective measures of performance? How often will the reviews be done? Who will conduct the reviews? What review processes will be used? Do not dwell on these questions at this point. The questions simply provide a roadmap for what is to follow. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Whom to review Start at the top of the organization and work down. Few people complain about having too much information about their performance. Do not hesitate to work toward reviews for all employees. Few people complain about receiving too many sincere compliments and too much thanks. Set an example at the top. It helps for the person being reviewed to know that the person doing the review has already had his or her own review. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Individual or group Person-by-person is most common. Team reviews may need to come before individual reviews. When teamwork is the backbone of a business, reviews should first be done at the team level. A second step can be review of individuals with emphasis on contribution to team success, increased ability to contribute to team goals and progress in fitting into the team. No matter what is done in individual reviews, teamwork increases peer pressure to contribute to the team. In true teamwork environments, satisfying teammates becomes more important than satisfying a supervisor. Employees easily see the dilemma created by promoting teamwork while reviewing and rewarding individual effort. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Formal or informal Formal reviews occur on a regular schedule with written reports to employees. Informal reviews occur on an as needed basis. A combination of formal and informal reviews usually works best. Formal reviews usually include filling out a form or providing some other type of written report to employees. Employees usually have a chance to comment or respond to the evaluator’s assessment. Formal reviews often include discussion of needed changes in performance. Helping the employee think through career interests and opportunities can be incorporated into supervisor/employee discussions. With formal reviews, an employee’s file contains a paper trail of training, progress, retraining, development and in some cases disciplinary action. Informal reviews reflect a commitment to continuous and open communication with employees. The supervisor and employee confront problems as they occur. Praise is given as it is earned. Employees ask questions as they arise. Both supervisors and employees work to create an open environment that emphasizes mutual support. © Purdue University, Center for Food and Agricultural Business, 2002

Objective and/or subjective measures of performance
Strategic Business Planning for Commercial Producers Human Resources Objective and/or subjective measures of performance The objective approach measures performance against specific standards, e.g., times tardy this year. The subjective measures are based on evaluator’s judgment, intuition, and feelings, e.g., attitude of employee. Realistically, subjective measures cannot be avoided. Challenge is to combine objective and subjective measures. Job requirements dictate which objective standards to be used in performance evaluation. The simple guideline is, “If it isn’t important to the job, why should it be measured?” The range of objective standards used in performance evaluations is limited only by the range of important tasks included in job descriptions, e.g., rate of weight gain, net return per cwt. of production, turnover of employees supervised, number of new customers per month, days worked without injury, returned orders, customers trying a new product and yields. All jobs can have some objective measures of performance. Much less formal measures dictate subjective criteria, e.g., attitude, initiative, aggressiveness, flexibility, friendliness and openness. When supervisors and employees know each other well and interact often, feelings toward each other can easily become subjective. Employees not receiving regular formal reviews of their performance are still being judged subjectively by their supervisors and coworkers. The employees are simply missing the benefit of concrete feedback on how they are doing, which parts of their work are best and which parts most need improvement. Realistically, subjective measures cannot be avoided. Supervisors regularly make judgments about each employee’s performance. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Frequency Formal evaluations should be conducted at least once each year. Formal evaluations more than two times per year are usually infeasible. Sticking to announced schedule of reviews is much more important than how often. Glut of reviews at one time can be avoided by scheduling on anniversary of first day on the job. Sticking to the announced schedule is much more important than how often the reviews are done. Some employees, e.g., the best performers, eagerly look forward to their reviews. Postponing the reviews or worse, simply letting the date slip by without scheduling the reviews, may be disheartening to the employees most valued in the business. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Evaluator Usually the immediate supervisor. Supervisors can seek input from others. Employees will not take seriously evaluations from people who are not well acquainted with what actually happens day-to-day in the work place. © Purdue University, Center for Food and Agricultural Business, 2002

Choice of evaluation processes
Strategic Business Planning for Commercial Producers Human Resources Choice of evaluation processes Keep it simple to start; add the bells and whistles later. Evaluation should be based on a job description, i.e., what the employee was hired to do. Starting with a simple process allows supervisors and employees to become comfortable with giving and receiving performance reviews. Detail, complexity and sophistication can be added later. Complex and time consuming long forms and detailed data should be added when the need has been clearly shown and the chances of success are high. Designing a review process starts with the job not the employee. Ideally, each job has tasks, duties and responsibilities understood by the supervisor and employee through a job description. The job description provides standards against which performance can be measured. The standards dictate the data that need to be collected, what the supervisor needs to be documenting between performance reviews, and judgments that need to be made. Whatever the process, the supervisor and employee need to have two-way communication that leads to understanding and agreement. The agreement covers what has been accomplished since the last review, the corrective action if any that is needed and the employee’s longer run aspirations and plans. © Purdue University, Center for Food and Agricultural Business, 2002

Simplest process follows this general outline
Strategic Business Planning for Commercial Producers Human Resources Simplest process follows this general outline Analyze the job to have a basis for a job description and performance standards, i.e., expected outcomes. Observe performance, collect performance data and make judgments to then be able to say to the employee, “I see your three most important strengths (contributions or accomplishments) as. . . ” The process begins by reviewing the job description and performance standards, i.e., expected outcomes. © Purdue University, Center for Food and Agricultural Business, 2002

Simplest process (continued)
Strategic Business Planning for Commercial Producers Human Resources Simplest process (continued) Ask the employee, “What do you see as your most important strengths (contributions, accomplishments)?” Say to the employee, “I see this (these two things) as most important for improving during the next six months.” © Purdue University, Center for Food and Agricultural Business, 2002

Strategic Business Planning for Commercial Producers Human Resources Simplest process (continued) Ask the employee, “What would you like to improve?” Follow with a discussion of needed follow up by discussing possible training, retraining, needed equipment, useful information and whatever else may be necessary for the employee to meet performance standards. © Purdue University, Center for Food and Agricultural Business, 2002

Strategic Business Planning for Commercial Producers Human Resources Simplest process (continued) Summarize with, “I want to summarize what we have agreed to.” Conclude with a positive note and assure the employee that there will be opportunity for follow up including the next scheduled performance review. Introduce the summary with an explicit statement like, “I want to summarize what we have agreed to.” This signals that the wrap up is all that remains. © Purdue University, Center for Food and Agricultural Business, 2002

Strategic Business Planning for Commercial Producers Human Resources Simplest process (continued) Supervisor writes summary for the file and shares a copy with the employee. Supervisor invites employee to respond in writing. Note  No forms required and emphasis is on helping employee improve. This written summary establishes the paper trail that is important in any litigation. © Purdue University, Center for Food and Agricultural Business, 2002

Human Resources Graphic rating scale Most common process for employee evaluation. Built around a brief form. Form based on job description. Form designed to identify employee’s strengths, weaknesses and areas for improvement. Provides an overall assessment of performance. The form is easy to understand because it reflects the key performance standards that come from a job description. When employees do not have a written job description, the supervisor and employee should agree on key performance standards before the evaluation is conducted. A form needs to be tailored to each job because tasks and key performance standards vary from job to job. Some measures can be objective such as quantity of work, reliability, and attendance. Other measures can be subjective requiring judgment by the supervisor, e.g., adaptability and cooperation. © Purdue University, Center for Food and Agricultural Business, 2002

Tips for employee reviews
Train all supervisors to do employee reviews. Strive for a positive supervisor attitude toward employee reviews. Don’t surprise employees with reviews. Stick to an announced schedule. Explain the review procedures to all employees.

Ask employees to think about their own performance, their questions and their career aspirations before discussion with their supervisors. Discuss performance in private. View employee reviews as an opportunity for open and honest communication.

Make the review communication two-way. Make the annual or semi-annual formal evaluation a supplement to continuous informal communication. Be prepared to deal with strong emotional responses from employees. Spend some time on career implications.

End the review on a positive note. Ask employees how the review process can be improved.

Human Resources Strategic Business Planning for Commercial Producers © Purdue University, Center for Food and Agricultural Business, 2002

Leading, Motivating and Evaluating Employees

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