Implementing a Performance Management System: Overview Preparation Communication Plan Appeals Process Training Programs Pilot Testing Ongoing Monitoring and Evaluation Prentice Hall, Inc. © 2006

Preparation Need to gain system buy-in through: Communication plan regarding Performance Management system Including appeals process Training programs for raters Pilot testing system Ongoing monitoring and evaluation Prentice Hall, Inc. © 2006

Communication Plan answers: What is Performance Management (PM)? How does PM fit in our strategy? What’s in it for me? How does it work? What are our roles and responsibilities? How does PM relate to other initiatives? Prentice Hall, Inc. © 2006

Cognitive Biases that affect communications effectiveness Selective exposure Selective perception Selective retention Prentice Hall, Inc. © 2006

To minimize effects of cognitive biases: A. Consider employees: Involve employees in system design Show how employee needs are met Prentice Hall, Inc. © 2006

To minimize effects of cognitive biases: B. Emphasize the positive Use credible communicators Strike first – create positive attitude Provide facts and conclusions Prentice Hall, Inc. © 2006

To minimize effects of cognitive biases: C. Repeat, document, be consistent Put it in writing Use multiple channels of communication Say it, and then – say it again Prentice Hall, Inc. © 2006

Appeals Process Promote Employee buy-in to PM system Amicable/Non-retaliatory Resolution of disagreements Prentice Hall, Inc. © 2006

Appeals Process Employees can question two types of issue: Judgmental (validity of evaluation) Administrative (whether policies and procedures were followed) Prentice Hall, Inc. © 2006

Appeals Process Level 1 Level 2 HR reviews facts, policies, procedures HR reports to supervisor/employee HR attempts to negotiate settlement Level 2 Arbitrator (panel of peers and managers) and/or High-level manager – final decision Prentice Hall, Inc. © 2006

Rater Training Programs Content Areas to include Information Identifying, Observing, Recording, Evaluating How to Interact with Employees Choices of Training Programs to implement RET FOR BO SL Prentice Hall, Inc. © 2006

Content A. Information - how the system works Reasons for implementing the performance management system Information the appraisal form system mechanics Prentice Hall, Inc. © 2006

Content B. Identifying, observing, recording, and evaluating performance How to identify and rank job activities How to observe, record, and measure performance How to minimize rating errors Prentice Hall, Inc. © 2006

Content C. How to interact with employees when they receive performance information How to conduct an appraisal interview How to train, counsel, and coach Prentice Hall, Inc. © 2006

Choices of Training Programs Rater Error Training (RET) Frame of Reference Training (FOR) Behavioral Observation Training (BO) Self-leadership Training (SL) Prentice Hall, Inc. © 2006

Rater Error Training (RET) Goals of Rater Error Training (RET) Make raters aware of types of rating errors Help raters minimize errors Increase rating accuracy Prentice Hall, Inc. © 2006

Intentional rating errors Leniency (inflation) Severity (deflation) Central tendency Prentice Hall, Inc. © 2006

Unintentional rating errors Similar to Me Halo Primacy First impression Contrast Stereotype Negativity Recency Spillover Prentice Hall, Inc. © 2006

Possible Solutions for Types of Rating Errors Intentional Focus on motivation Demonstrate benefits of providing accurate ratings Unintentional Alert raters to different errors and their causes Prentice Hall, Inc. © 2006

Frame of Reference Training (FOR) Goal of Frame of Reference Training (FOR)* Raters develop common frame of reference Observing performance Evaluating performance *Most appropriate when PM appraisal system focuses on behaviors Prentice Hall, Inc. © 2006

Expected Results of Frame of Reference Training (FOR) Raters provide consistent, more accurate ratings Raters help employees design effective development plans Prentice Hall, Inc. © 2006

Behavioral Observation Training (BO) Goals of Behavioral Observation Training (BO) Minimize unintentional rating errors Improve rater skills by focusing on how raters: Observe performance Store information about performance Recall information about performance Use information about performance Prentice Hall, Inc. © 2006

Self-leadership Training (SL) Goals of Self-leadership Training (SL) Improve rater confidence in ability to manage performance Enhance mental processes Increase self-efficacy Prentice Hall, Inc. © 2006

Pilot Testing Provides ability to Discover potential problems Fix them Prentice Hall, Inc. © 2006

Pilot Testing - benefits Gain information from potential participants Learn about difficulties/obstacles Collect recommendations on how to improve Understand personal reactions Get early buy-in Get higher rate of acceptance Prentice Hall, Inc. © 2006

Implementing a Pilot Test Roll out test version with sample group Staff and jobs generalizable to organization Fully implement planned system All participants keep records of issues encountered Do not record appraisal scores Collect input from all participants Prentice Hall, Inc. © 2006

Ongoing Monitoring and Evaluation When system is implemented, decide: How to evaluate system effectiveness How to measure implementation How to measure results Prentice Hall, Inc. © 2006

Evaluation data to collect: Reactions to the system Assessments of requirements Operational Technical Effectiveness of performance ratings Prentice Hall, Inc. © 2006

Indicators to consider Number of individuals evaluated Distribution of performance ratings Quality of information Quality of performance discussion meetings System satisfaction Cost/benefit ratio Unit-level and organization-level performance Prentice Hall, Inc. © 2006