Performance Measures Criteria Criteria used to evaluate Performance Management Systems: Strategic Congruence Extent to which performance mgt systems elicits job performance that is congruent with org strategy, goals and culture. Critical Success Factors Validity Extent to which a performance measure assess all relevant aspects of performance Not Deficient or Contaminated Reliability Consistency of a performance measure 3 types: Interrater – 2 individuals give the same evaluations of the person’s job performance Internal Consistency Test-retest reliability – reliability over time

Performance Measures Criteria Criteria used to evaluate Performance Management Systems: 4. Acceptability Refers to whether the people who use a performance measure accept it. Based on “perceived fairness”: Procedural – how it is done (ex. Employee participation on development of system) Interpersonal fairness – feedback (timely and complete) Outcome fairness – communication of outcomes (evaluation standards, expectations, rewards) 5. Specificity Extent to which a performance measure tells employees what is expected of them and how they can meet these expectations.

Approaches to measuring performance

The Comparative Approach Ranking Simple Ranking Alternation Ranking Forced Distribution Entails putting certain percentages of employees into predetermined categories Forces managers to evaluate based on Job-related criteria rather than to be lenient. Paired Comparison Requires managers to compare every employee with every other employee in the work group # of times employee gets favorable decision = Employee’s Performance Score Comparison of an individual’s performance with others Seeks to develop ranking of individuals within a group

The Comparative Approach Evaluating the Comparative Approach: Effective tool in differentiating employee performance Eliminates problems of liniency Common failure to be linked with to strategic goals of the organization due to: Subjective nature of ratings Validity and reliability depend on raters themselves Multiple evaluations can be done to reduce bias Lacks Specificity (for feedback purposes) Low Acceptability employee performance related to employee in group/ team rather than measured against an absolute standard of excellence.