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© McGraw-Hill Companies, Inc., 1999 1 Chapter 5 Evaluation, Feedback, and Reward of Individual Behavior John M. Ivancevich Michael T. Matteson Slides Prepared by Bruce R. Barringer University of Central Florida
© McGraw-Hill Companies, Inc., 1999 2 Learning Objectives Slide 1 of 2 Describe several purposes of performance evaluation. Explain why a 360-degree feedback program is considered more thorough. Discuss reinforcement theory. Describe the elements in a model of rewards.
© McGraw-Hill Companies, Inc., 1999 3 Learning Objectives Slide 2 of 2 Compare intrinsic and extrinsic rewards. Understand the role rewards play in turnover, absenteeism, performing, and commitment. Identify several innovative reward systems.
© McGraw-Hill Companies, Inc., 1999 4 Purposes of Evaluation Judgmental OrientationDevelopmental Orientation - Provide basis for reward allocation - Identify high-potential employees - Validate effectiveness of employee selection procedures - Evaluate previous training programs - Facilitate future performance improvements - Develop ways of overcoming obstacles & performance barriers - Identify training and development opportunities - Establish supervisor-employee agreement on performance expectations
© McGraw-Hill Companies, Inc., 1999 5 Focus of Evaluation Effective performance evaluation asks the following two questions: Is the work being done effectively? Are employee skills and abilities being fully utilized?
© McGraw-Hill Companies, Inc., 1999 6 Improving Evaluations Slide 1 of 2 Suggestions for Improving the Effectiveness of an Evaluation System –Ask employees to participate in the evaluation process. –Set specific performance goals. –Provide supervisors training in evaluation subordinates performance. –Communicate the results of the evaluation process to employees.
© McGraw-Hill Companies, Inc., 1999 7 Improving Evaluations Slide 2 of 2 Suggestions for Improving the Effectiveness of an Evaluation System (continued) –Do not focus entirely on problem areas; good performance should be actively recognized and rewarded. –Make performance evaluation a continuous, ongoing process.
© McGraw-Hill Companies, Inc., 1999 8 Performance Evaluation Feedback Performance evaluation feedback can be instructional and/or motivational to the receiver (the evaluated person). Instructional Feedback instructs when it points out areas for improvement and teaches new behavior Motivational Feedback is motivational when it provides a reward or promises a reward
© McGraw-Hill Companies, Inc., 1999 9 Multisource Feedback: A 360-Degree Approach A 360-degree program evaluators could include creditors, peers or team members, supervisors, subordinates, and the person being evaluated. The increasing use of multisource programs is the result of calls for more fairness, clarity, and creditability in performance improvement programs.
© McGraw-Hill Companies, Inc., 1999 10 Reinforcement Theory Slide 1 of 2 Rationale behind Reinforcement Theory –Learning experts believe that reinforcement is the most important principle of learning. –Desired or reinforcing consequences will increase the strength of a behavior and increase the probability of the behavior being repeated. Operants –Behaviors that can be controlled by altering the consequences that follow them.
© McGraw-Hill Companies, Inc., 1999 11 Reinforcement Theory Slide 2 of 2 Forms of Reinforcement –Positive Reinforcement A stimulus that, when applied to the situation, strengthens the probability of a behavioral response. –Punishment Is defined as presenting an uncomfortable or unwanted consequence for a particular behavioral response. –Extinction Reduces unwanted behavior by withholding positive reinforcers.
© McGraw-Hill Companies, Inc., 1999 12 Exhibit 5.2: Rewards, Reinforcement, and Punishment DesirableUndesirable Applied Withdrawn III IIIIV Positive reinforcement (behavior increases) Punishment (behavior decreases) Negative reinforcement (behavior increases)
© McGraw-Hill Companies, Inc., 1999 13 Reinforcement Schedules Slide 1 of 2 Fixed Interval –A situation in which a reinforcer is applied only after a certain period of time has elapsed since the last reinforcer was applied. Variable Interval –A reinforcer applied at some variable interval of time.
© McGraw-Hill Companies, Inc., 1999 14 Reinforcement Schedules Slide 2 of 2 Fixed Ratio –A reinforcer is applied only if a fixed number of desired responses have occurred. Variable Ratio –A reinforcer is applied only after a number of desired responses, with the number of desired responses changing from situation to situation, around an average.
© McGraw-Hill Companies, Inc., 1999 15 Exhibit 5.4: The Reward Process Motivation to exert effort Motivation to exert effort Experience Ability and skill Ability and skill Performance results: Individual Performance results: Individual Performance evaluation Performance evaluation Extrinsic Rewards Extrinsic Rewards Intrinsic rewards Intrinsic rewards Satisfaction
© McGraw-Hill Companies, Inc., 1999 16 Intrinsic and Extrinsic Rewards Intrinsic Rewards –Rewards that are part of the job itself. The responsibility, challenge, and feedback characteristics of the job are intrinsic rewards. Extrinsic Rewards –Rewards external to the job such as pay, promotion, or fringe benefits.
© McGraw-Hill Companies, Inc., 1999 17 Administering Rewards The three major theoretical approaches to reward administration are: Positive Reinforcement Positive Reinforcement Modeling and Social Interaction Modeling and Social Interaction Expectancy Theory Expectancy Theory
© McGraw-Hill Companies, Inc., 1999 18 Organizational Concerns that are Influenced by Rewards Turnover and Absenteeism PerformanceCommitment
© McGraw-Hill Companies, Inc., 1999 19 Innovative Reward Systems Skill-Based Pay Broadbanding Team-Based Rewards Banking Time Off All-Salaried Team Gainsharing Employee Stock Ownership Plans
© McGraw-Hill Companies, Inc., 1999 20 Line of Sight: The Key Issue Real link between performance and rewards Line of sight means that the employee perceives that there is a real linkage between his or her performance and the rewards received.
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