Performance Management Chapter 8 Performance Management

Performance Management Performance Appraisal Introduction Performance Management The means through which managers ensure that employees’ activities and outputs are congruent with the organization's goals. Performance Appraisal The process through which an organization gets information on how well an employee is doing his or her job. Performance Feedback The process of providing employees information regarding their performance effectiveness.

The Practice of Performance Management How different organizations deal with performance management systems?

An Organization Model of Performance Management Organizational Strategy Long and short term goals and values Individual Attributes (skills, abilities) Objective Results Individual Behaviors Situational Constraints Culture and economic conditions

Purposes of Performance Management Strategic Purpose Administrative Purpose Developmental Purpose

Performance Measure Criteria Strategic Congruence The extent to which the performance management system elicits job performance that is congruent with the organization's strategy, goals, and culture. Validity The extent to which the performance measure assesses all the relevant—and only the relevant—aspects of job performance. Reliability The consistency of the performance measure “The degree to which performance measure is free from random error”. Acceptability The extent to which a performance measure is deemed to be satisfactory or adequate by those who use it. “Whether the people who use the performance measure accept it”. Specificity The extent to which a performance measure gives specific guidance to employees about what is expected of them and how they can meet these expectations.

Approaches to Measure Performance The Comparative Approach Ranking / Alternation Ranking Forced Distribution Paired Comparison The Attribute Approach Graphic Rating Scale Mixed Standards Scale

Approaches to Measure Performance The Behavioral Approach Critical Incidents Behaviorally Anchored Rating Scales (BARS) Behavioral Observation Scales (BOS) Organizational Behavior Modification Assessment Centers

Approaches to Measure Performance The Results Approach Management by Objectives Productivity Management and Evaluation System Evidence Based HR The Quality Approach Statistical process quality control techniques used: Process-flow analysis - Cause-and-effect diagrams - Pareto chart - Control chart – Histogram - Scattergram Survey Feedback Interventions

Choosing A Source for Performance Information Data Collection Sources 1- Managers 2- Peers 3- Subordinates (Up word feedback) 4- Self 5- Customers 5- 360 Degree Appraisal

Raters Errors in Performance Measurement 1- Similar to Me 3- Distributional Errors 2- Contrast 4- Halo and Horns Reducing Rater Errors Rater error training - Rater accuracy training Appraisal Politics a situation in which evaluators purposefully distort ratings to achieve personal or company goals

The Manager’s Role in an Effective Performance Feedback Process 1- Feedback should be given frequently, not once a year. 6- Focus on solving problems. 2- Create the right context for the discussion. 7- Focus feedback on behavior or results, not on the person. 3- Ask employee to rate his or her performance before the session. 8- Minimize criticism. 4- Encourage the subordinate to participate in the session. 9- Agree to specific goals and set a date to review progress. 5- Recognize effective performance through praise.

Diagnosing the Causes of Poor Performance What Managers Can Do to Diagnose Performance Problems and Manage Employee Performance Diagnosing the Causes of Poor Performance 1- Input 2- Employee characteristics 3- Feedback 4- Performance standards/Goals 5- Consequences

Actions for Managing Employees’ Performance What Managers Can Do to Diagnose Performance Problems and Manage Employee Performance Actions for Managing Employees’ Performance Marginal Employees An employee performing at a barely acceptable level because of lack of ability and / or motivation to perform well, not poor work conditions Solid Performers High ability and motivation; managers should provide development opportunities Misdirected Effort Lack of ability but high motivation; managers should focus on training Underutilizers High ability but lack motivation; managers should focus on interpersonal abilities Deadwood Low ability and motivation; managerial action, outplacement, demotion, firing.