Presentation on theme: "Performance Management"— Presentation transcript:
1 Performance Management Effective Performance Management SystemMake clear what the organization expectsProvide performance information to employeesDocument performance for personnel recordsIdentify areas of success and needed development
3 Performance Management versus Performance Appraisal Processes used to identify, encourage, measure, evaluate, improve, and reward employee performancePerformance AppraisalThe process of evaluating how well employees perform their jobs and then communicating that information to the employees
5 Identifying and Measuring Employee Performance *Quantity of output*Quality of output*Timeliness of output*Presence*CitizenshipTeam member
6 Identifying and Measuring Employee Performance Job DutiesImportant elements in a job as identified from job descriptions.What an employer pays an employee to do.
7 Types of Performance Information SubjectiveObjective
8 Relevance of Performance Criteria Factors:Deficient measuresContaminated measuresOveremphasized measures
9 Example: ACTFL Performance Standards for Speaking Proficiency
10 Performance Metrics in Service Businesses Common Sources of Performance DifferencesRegional Labor Cost DifferencesService Agreement DifferencesEquipment/ Infrastructure DifferencesWork VolumePerformance that is measured can be managed.
12 Decisions About the Performance Appraisal Process Appraisal responsibilitiesInformal vs. systematic processesTiming of appraisalsSource(s) of performance information
13 Legal Concerns and Performance Appraisals Legally Defensible Performance Appraisal System:Appraisal criteria based on job analysis (i.e., job-related)Absence of disparate impact and evidence of validityFormal evaluation criteria that limit managerial discretionFormal rating instrument linked to job duties and responsibilitiesPersonal knowledge of and contact with rateeTraining of supervisors in conducting appraisalsReview process to prevent undue control of careersCounseling to help poor performers improve
14 Typical Division of HR Responsibilities: Performance Appraisal
16 Employee Rating of Managers AdvantagesDisadvantagesHelps in identifying competent managersServes to make managers more responsive to employeesContributes to the career development of managersNegative reactions by managers to ratingsSubordinates’ fear of reprisals may inhibit them from giving realistic (negative) ratingsRatings are useful only for self-improvement purposes
17 Team/Peer Rating Advantages Disadvantages Helps improve performance of lower-rated individualsPeers have opportunity to observe other peersPeer appraisals focus on individual contributions to teamwork and team performanceCan negatively affect working relationshipsCan create difficulties for managers in determining individual performanceOrganizational use of individual performance appraisals can hinder the development of teamwork
19 Category Scaling Methods Graphic Rating ScaleAllows the rater to indicate an employee’s performance on a continuum of job behaviors.Aspects of Performance MeasuredDescriptive CategoriesJob DutiesBehavioral Dimensions
21 Graphic Rating Scales Disadvantages: Restrictions on the range and type of rater responsesDifferences in rater interpretations of scale item meanings and scale rangesRating form deficiencies limit effectiveness of the appraisalPoorly designed scales that encourage rater errors
23 More Scaling Methods Behaviorally Anchored Rating Scale (BARS) Composed of job dimensions (specific descriptions of important job behaviors) that “anchor” performance levels on the scale.Developing a BARSIdentify important job dimensionsWrite short statements of job behaviorsAssign statements (anchors) to job dimensionsSet scales for anchors
24 Behaviorally-Anchored Rating Scale Example for Customer Service Skills
25 Comparative Methods Ranking Listing employees from highest to lowest DisadvantagesDoesn’t reflect size of differences between employeesImplies that lowest-ranked employees are unsatisfactory performers.Laborious if the group to be ranked is large.Paired comparisons
26 More Comparative Methods Forced DistributionEmployee performance ratings distributed along bell-shaped curve.AdvantagesHelps deal with “rater inflation.”Makes managers identify high, average, and low performers.Ensures that compensation increases reflect performance differences among individuals.DisadvantagesManagers resist placing people in the lowest or highest groups.Explanation for placement can be difficult.Performance may not follow normal distribution.Managers may make false distinctions between employees.
28 Narrative Methods Critical Incident Manager keeps written record of highly favorable and unfavorable employee perf.DisadvantagesVariations in how managers define “critical incident”Time consuming and limited opportunity to observeMost employee actions are not observed and may change if observed
29 Narrative Methods Essay Manager writes essay describing an employee’s performance.DisadvantagesDepends on the managers’ writing skills and their ability to express themselves.Time consumingMay lack opportunities to observe perf.
30 Management by Objectives (MBO) Performance goals that an individual and his/her manager agree the employee will to try to attain within appropriate length of time.Key MBO IdeasEmployee involvement creates higher levels of commitment and performance.Employees encouraged to work effectively toward goals.Perf. measures should be measurable and should define results.
31 The MBO Process 1. Job review and agreement 3. Setting of objectives 4. Continuing performance discussions3. Setting of objectives2. Development of performance standards1. Job review and agreement
32 MBO Process Job Review and agreement Development of performance standardsSetting of objectivesContinuing performance discussions
33 Preparing Managers to Deliver Performance Information Procedure and timingPerformance criteriaRating errorsDelivering feedbackCompensation decisionsTraining needs assessment
35 Hints for Delivering an Effective Performance Appraisal
36 Strategic Performance Management System *Consistent with org strategic mission*Documents performance*Perceived as fair*Legal and job-related*Developmental tool—leads to performance improvement, promotion, etc.