1. Learning Objectives What managing performance involves
Identify the benefits of performance appraisal
Identify the types of performance appraisal and the processes involved
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

2. Recruitment & Selection
Strategy
Recruitment & Selection
Job description
(skills & behaviours required)
Training and development
Structure
Reward management
Values
Performance appraisal
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

3. Recruitment & Selection
Strategy
Recruitment & Selection
Job description
(skills & behaviours required)
Training and development
Structure
Reward management
Values
Performance appraisal
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

4. Concepts:
Performance Appraisal (PA)  Process of evaluating an employee’s current and/or past performance relative to his or her performance standards.
Performance Management (PM)  Systematic approach to link organizational strategy to employees performance through the integration of activities that assess, appraise, develop and reward employees.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

5. Performance Management
… is broader than PA. It starts with a look at the goals and strategy of the organization in order to develop a variety of interlinked processes/practices that involve assessment and development of an individual and their performance at work, both in terms of their existing effectiveness and their potential for advancement.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

6. Link between Strategy, Outcomes, and Organizational Results
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

7. Why Performance Management (1)
The belief that traditional performance appraisals are often not just useless but counterproductive.
The necessity in today’s globally competitive environment for every employee’s efforts to focus on helping the company to achieve its strategic goals.
The popularity of the total quality management (TQM) concepts.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

8. Why Performance Management (2)
Need for Continuous improvement:
In order to achieve the market demands, costumer requirements…
Requiring each employee to continuously improve his or her own personal performance, from one appraisal period to the next
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

9. Purpose of PM
To make administrative decisions concerning pay, promotions and careers, and work responsibilities Control purpose
To improve performance through discussion of development needs, identifying training opportunities and the planning of action Development purpose
Research purpose
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

10. Maybe et al. (1998)
Research has shown that organizations with strong performance management systems in place
Show increased profitability
Reduced attrition -> conflict
Higher levels of engagement/employee commitment
Receive higher satisfaction ratings on customer survey
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

11. Why Appraise Performance?
Appraisals play an integral role in the performance management process;
Appraisals help in planning for correcting deficiencies and reinforce things done correctly.
Appraisals are useful in identifying employee strengths and weaknesses and for career planning
Appraisals affect the employer’s salary raise decisions.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

12. Participants The Employee Supervisor (line manager)
HR Department - personnel adviser, Head of Department, etc…
Others: Customers, colleagues, etc
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

13. Employee Every employee should:
Know the job requirements to perform his/her job successfully
know what to, and what not to, do
Responsible for their own performance
Train and develop new KSAs that are required for job performance
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

14. Supervisor Usually does the actual appraising.
Must be familiar with basic appraisal techniques.
Must understand and avoid problems that can cripple appraisals.
Must know how to conduct appraisals fairly.
Give the employee advance notice
Give the employee an advance copy of the appraisal
Must BE PREPARED.
Review prior performance appraisals
Review any notes taken regarding employee’s performance
BE FAMILIAR with the employee’s job
What projects they are working on, etc.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

15. HR - Department Serves a policy-making and advisory role.
Provides advice and assistance regarding the appraisal tool to use.
Prepares forms and procedures and makes sure that all departments use them.
Responsible for training supervisors to improve their appraisal skills.
Responsible for monitoring the system to ensure that appraisal formats and criteria comply with Employment/Labour laws and are up to date.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

16. Appraising Tools What to measure?
Work output (quality and quantity) ->(Productivity)
Personal competencies
Goal (objective) achievement
Contributions, effort
How to measure it?
Self-rating or Supervisor - Rating scales
Multiple source rating
3600 degrees feedback -> supervisor, colleagues, costumers, etc.
MBO/SMART
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

17. Rating Scales
Scales that lists a number of traits and a range of performance for each that is used to identify the score that best describes an employee’s level of performance for each trait.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

18. Portion of an Administrative Secretary’s Sample Performance Appraisal Form
Source: James Buford Jr., Bettye Burkhalter, and Grover Jacobs, “Link Job Description to Performance Appraisals,” Personnel Journal, June 1988, pp. 135–136.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

19. Performance Management Outline
Source: James Buford Jr., Bettye Burkhalter, and Grover Jacobs, “Link Job Description to Performance Appraisals,” Personnel Journal, June 1988, pp. 135–136.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa
© 2005 Prentice Hall Inc. All rights reserved.

20. Performance Management Outline (cont’d)
Source: James Buford Jr., Bettye Burkhalter, and Grover Jacobs, “Link Job Description to Performance Appraisals,” Personnel Journal, June 1988, pp. 135–136.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa
© 2005 Prentice Hall Inc. All rights reserved.

21. Performance Management Outline (cont’d)
Source: James Buford Jr., Bettye Burkhalter, and Grover Jacobs, “Link Job Description to Performance Appraisals,” Personnel Journal, June 1988, pp. 135–136.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa
© 2005 Prentice Hall Inc. All rights reserved.

22. Behaviorally anchored rating scale (BARS)
An appraisal method that uses quantified scale with specific narrative examples of good and poor performance.
Developing a BARS:
Generate critical incidents
Develop performance dimensions
Reallocate incidents
Scale the incidents
Develop a final instrument
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

23. Advantages of using a BARS A more accurate gauge Clearer standards
Feedback
Independent dimensions
Consistency
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

24. Example of a Behaviorally Anchored Rating Scale for the Dimension Salesmanship Skill
Source:Walter C. Borman, “Behavior Based Rating,” in Ronald A. Berk (ed.), Performance Assessment: Methods and Applications (Baltimore, MD: Johns
Hopkins University Press, 1986), p. 103.
Figure 9–9
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

25. Potential Rating Scale Appraisal Problems
Unclear standards
An appraisal that is too open to interpretation.
Halo effect
Occurs when a supervisor’s rating of a subordinate on one trait biases the rating of that person on other traits.
Central tendency
A tendency to rate all employees the same way, such as rating them all average.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

26. Management by Objectives
Is a PM system in which;
performance objectives are jointly determined by both employees and supervisors
progress towards the objectives is periodically reviewed
rewards are allocated on the basis of this progress.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

27. Employees should see alignment from their own goals
with the Organization goals
Individual Department/ Organizational
Unit
Mission
Strategy
Values
Priorities
Major Responsibilities & Priorities
KSAs & Behavior
Performance Management Process
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

28. Management by Objectives-SMART
MBO - Involves setting specific measurable goals with each employee and then periodically reviewing the progress made.
Set the organization’s goals.
Set departmental goals.
Discuss departmental goals.
Define expected results (set individual goals).
Performance reviews.
Provide feedback.
Biggest problem with MBO’s is when they are vague or unclear
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

29. SMART Goals
Specific – Enough detail do that employee and supervisor understand and agree on the goal
Measurable- Establish criteria so that employee and supervisor know when/how the goal is completed
Attainable – The employee can reasonably expect to accomplish the goal taking into account work circumstances.
Relevant – Accomplish the task contributes to the work unit goals and objectives.
Time-Framed – Describes when the work is done: daily, weekly, monthly, etc…
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

30. Performance Management When?
PM is a continuous process
Effective appraisals should occur frequently
But in practice some times only once a year
Important to make sure that appraisals are measured, documented and can be shown to match the Job Expectations
It should not be a surprise when an employee has his or her own appraisal
Essential for coaching and motivation of the employee
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

31. PM Continuous Cycle
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

32. Phase I
Set Goals
Establish link between organizational, department, team and individual objectives
Create mutually agreed goals (Targets)
Make goal statements SMART (Specific, Measureable, Achievable, Relevant and Time-phased)
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

33. Phase II Track Performance
Discuss development of employee’s work-related skills, knowledge and experience
Use Coaching Model: Identify need, coach and provide support -> Training
Base the development plan on both organizational and individual needs
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

34. Phase III Analyze Results
Observe and record the employee’s performance on the agreed targets
Recognize accomplishments
Resolve performance problems
Compare results to agreed upon standards (Goals/Targets)
Common metrics: cost, quality, quantity, time
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

35. Phase IV Review & Renew Ask for the employee’s perspective
Prepare performance documents
Conduct the performance
Identify needs, provide opportunities for training and provide support continuously
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

36. The Appraisal Interview
The discussion should:
Develop in terms of objective work data.
Not get personal.
Encourage the employee to talk.
Not avoid difficult topics.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

37. The Appraisal interview (cont’d)
How to handle a defensive subordinate:
Recognize that defensive behavior is normal.
Never attack a person’s defenses.
Postpone action.
Recognize your own limitations.
You are their boss – not their shrink
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

38. Appraisal Interview (cont’d)
How to ensure the interview leads to improved performance
Don’t make the subordinate feel threatened during the interview.
Give the subordinate the opportunity to present his or her ideas and feelings and to influence the course of the interview.
Have a helpful and constructive supervisor conduct the interview.
Offer the subordinate the necessary support for development and change.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

39. Understand the Different Circumstances
Sick-leave and absenteeism
People at work that do not perform
Higher vs. Lower performers.
Raising performance expectations and standards
Remove barrier to higher performance
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

40. Effective Performance Management Discussions
Goals are a critical part of the performance management process
Individual goals must be linked to overall organizational goals. Employees must see the linkage.
Even when performance standards are preset, goal setting conversations still need to occur.
Goals should be S M A R T (Specific, Measureable, Achievable, Relevant and Time-phased)
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

41. (cont’d)
Define job-mastery and career development goals as part of the process, so that it is very clear how the current position supports employee growth and the additional opportunities the employee needs to explore. 
Promote flexibility, through regular check-in discussions, which include status updates, coaching, and feedback, that identify problems earlier on and change the course of a project or work assignment.
Give effective feedback
Be proactive rather than reactive
Look for opportunities to catch people doing things right
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

42. Managing Problem Performance
Do not ignore challenges of not meeting the standards:
Discussing areas of concern
Setting targets and timescales for improvement
Agreeing appropriate training and support
Informal performance review (manager + employee)
Formal performance review (manager + employee + HR practitioner)
Slide Content Acknowledgement: Dr. Ana-Cristina Costa

43. Case Study Further Reading
The Light Machine Shop (Banfield & Kay: pg. 291)
Further Reading
Banfield, P. and Kay, R. (2008) Introduction to Human Resource Management, Oxford University Press. Pages, 269 – 293.
Slide Content Acknowledgement: Dr. Ana-Cristina Costa