Performance Management System By Muhammad Zohaib Sufyan SZABIST

Performance Management Planning Managing/ Coaching Developing Rewarding 2

5 Rules of PMP Employees are aware of their principal job functions & objectives. They understand the level of performance expected. They receive timely feedback about their performance. They have opportunities for training & professional development. They receive performance assessments & rewards in a fair & consistent manner.

Performance Appraisal Determining what areas of work the manager should be examining when measuring Performance. Identification Measurement The centerpiece of the appraisal system, entails making managerial judgments of how “good” or “bad” employee performance was? Management Appraisal must take a future-oriented view of what workers can do to achieve their potential in an organization.

The Performance Management Process DEVELOP Target Objectives +Values PERFORMANCE Feedback , Document & Coach MONTH J F M A M J J A S O D N PLAN MANAGE REWARD

Appraisal Methods Absolute Standards Relative Standards Critical Incident Technique Checklist Appraisal Adjective Rating Scale Appraisal Forced Choice Appraisal Behaviorally Anchored Rating Scale Relative Standards Group order ranking Individual Ranking Paired Comparisons

Management By Objective (MBO) A goal-directed approach to performance appraisal in which workers and their supervisors set goals together for the upcoming evaluation period Has 4 elements SMART Objectives Participative decision making An explicit time period Performance feedback

S pecific M easurable A ttainable R ealistic T ime bound SMART Objective S pecific M easurable A ttainable R ealistic T ime bound

Formula for writing Objectives DESIRED RESULT + ACTION OR ACTIVITY + MEASUREMENT + TIME

Exercise NOT SMART SMART Post strong growth in the PVC business Improve quality of product Improve my leadership skills Raise product knowledge of my sales team Attain a better audit rating Increase market share

? QUESTION OF ETHICS ? Is it right to give someone a higher (or lower) rating than you think that person deserves because you are trying to “send a massage,” or is this sort of behavior simply lying and therefore wrong?

Factors that can distort appraisal Leniency Error Halo Effect Similarity Error Central Tendency Attribution Theory First Impression Recency Effect

Effective Performance Management System Use behavior based measures Combine absolute & relative standards Provide ongoing feedback Have multiple raters Rate selectively Train appraisers

? QUESTION OF ETHICS ? Is it appropriate for organizations to evaluate and compensate employees according to objective measures of performance, even though performance is at least partially determined by factors beyond their control? Should a salesperson, for instance, be paid completely on commission even in the midst of a recession that makes it practically impossible to sell enough to make a decent living?

THE BENEFITS OF PERFORMANCE APPRAISAL

Employer’s 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.

Employer’s Perspective - CONTD 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 individual, appraisal criteria can include team work and the teams can be the focus of appraisal.

Employee’s Perspective Performance feedback is needed and desired. Improvement in performance requires assessment. Fairness require 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.

Situational Factors, Causes of Performance Problems. Poor coordination among workers Inadequate Information Low-quality materials Lack of equipment Inability to obtain raw materials Inadequate Finance Poor Supervision Poor Relationship Inadequate Training Insufficient Time to produce Quality & Quantity of work A poor work Environment Equipment breakdown

Providing Constructive Feedback Conduct the appraisal in private and allow discussion Present perceptions, reactions, and opinions Refer the relevant performance Focus observable behavior Talk in terms of established criteria, & probable outcome Focus the factors limiting full effectiveness Suggest possible means of improving performance

Providing Constructive Feedback Contd. Providing Constructive Feedback Avoid loaded terms which may produce emotional reaction & defensiveness Concentrate those things which may improve the feedback Avoid to supply additional information Present the feedback showing acceptance of appraisee as worthwhile person Feedback should intended to be helpful and minimize the performance weaknesses

? Superficially, it seems preferable to use objective performance data (such as productive figures), when available, rather than subjective supervisory ratings to assess employees. Why might objective data be less effective performance measures than subjective ratings? WHY

Discuss? You are the owner of a 25-employee company that has just had a fantastic year. Everyone pulled together and worked hard to achieve the boost in company profits. Unfortunately, you need to sink most of those profits into paying your suppliers. All you can afford to give your worker is a 3% pay-rise across the board. At appraisal time how would you communicate praise for a job well done coupled with your limited ability to reward such out standing performance? Now assume you can afford to hand out some handsome bonuses. What would be the best way to evaluate employees when everyone has done exceptional work?

? “Occasionally an employee comes along who needs to be reminded who the boss is, and the appraisal is an appropriate place for such a reminder.” would the manager quoted here be likely to use a rational and political approaches. To what extent it is possible to separate the two?

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