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Performance Management
HRM3 - Performance Management
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Performance Management – Learning
By the end of this unit you should be able to: Explain what is meant by performance management Describe the process of performance management Critically evaluate the appraisal process Explain what is meant by an appraisal interview and describe it’s benefits and drawbacks to the organisation, the manager and the employee Describe 3 performance appraisal techniques Evaluate the 360 degree feedback method of appraisal Describe three interview styles associated with appraisal Describe the key actions required to conduct an effective appraisal interview Discuss the ethical dilemmas associated with performance appraisal Describe 5 key errors associated with the appraisal process HRM3 - Performance Management
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Summary of Key Headings
Performance Management Performance Appraisal The Appraisal Interview 360 degree feedback Ethical Dilemmas in appraisal HRM3 - Performance Management
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Factor influencing performance
According to Sparrow & Hiltrop (1994) the use of PMS is on the increase because of the following changes in the workplace Delayering Devolution of accountability & responsibility Changing career & job expectations Flexible working arrangements Individuation Competitive pressures HRM3 - Performance Management
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versus Performance Appraisal
Measuring a person’s job performance against predetermined work standards versus Performance Management A strategic management technique that links business objectives & strategies to individual goals, actions, performance appraisal & rewards thru a defined process. Incorporates appraisal, training & development, rewards, employee relations, individualism (Sparrow & Hiltrop 1994) HRM3 - Performance Management
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HRM3 - Performance Management
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Objectives of Performance Management Systems
Motivating performance Helping individuals develop their skills Building a performance culture Determining who should be promoted Eliminating individuals who are poor performers Helping implement business strategies
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Performance Management
Performance management is a management process of linking individual, group and organisation performance with the main strategic mission and values It is an organisation-wide activity concerned with the continuous assessment and review of performance against pre-determined strategic objectives
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Principles of Performance Management:
Owned and driven by line managers Emphasis on shared goals and values Something that is developed specifically and individually for the particular company It should apply to all staff HRM3 - Performance Management
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HRM3 - Performance Management
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Read CIPD Factsheet: Performance Management
What does the article mean when it says that performance management should be Strategic Integrated About improvement About development What is the difference between an objective & a performance standard? Give an example of each from your own experience. Explain what is meant by 360-degree feedback. HRM3 - Performance Management
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Characteristics of GOOD P. Mgt System
Tailored to the organisation Support the culture Support the mission Defines the critical success factors Clarifies the principal accountabilities Enables systematic review of performance Effective PRP system Integrated approach Philpott & Sheppard (1993) HRM3 - Performance Management
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Characteristics of BAD P. Mgt System
No clear objective Departmental rivalry Failure to meet objectives Lack of clear accountabilities Role ambiguity Absence & turnover Lack of training, development or career plans Resistance Loss of credibility Philpott & Sheppard (1993) HRM3 - Performance Management
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Criticisms of Performance Management systems
Form filling exercise Company goals only Means to set pay levels Does not identify future potential in employees Does not improve organisational performance A HR thing!! Dependent on your boss The 3 objectives conflicting objectives Subjective & unfair ratings HRM3 - Performance Management
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How to overcome these criticisms
Training Involvement in design ‘Open’ system Visibly owned by senior management Ease administration Follow up on appraisal actions HRM3 - Performance Management
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HRM3 - Performance Management
Review Questions Explain what performance management is both in writing and diagrammatic format What makes a good performance management system? What are the criticisms normally levelled at Performance Management Systems? How might you minimise these criticisms? HRM3 - Performance Management
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Performance Appraisal
Systematic approach to evaluating employee’s performance, characteristics or potential with a view to assisting with decisions in a wide range of areas such as pay, promotion, employee development, and motivation. (Gunnigle and Flood 1990) HRM3 - Performance Management
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Performance v’s Performance Appraisal Management
Imposed on managers Individual focus on individual performance A beginning and an end Just one part of the performance management process Owned and driven by line managers (Armstrong 1995) Organisation focus Links individual , group and organisational performance Tied to the organisations strategy Continuous and integrated process HRM3 - Performance Management
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HRM3 - Performance Management
Appraisal – As an employee………. As a manager ………… As the organisation……. HRM3 - Performance Management
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HRM3 - Performance Management
Why Appraise?? Employer Assess the performance of individuals Set individual objectives Assess how well objectives are being attained Confirm what jobs/tasks are actually being done Determine who should be promoted/transferred Determine who needs training Assess who should be considered for advancement Employee A career development exercise A way of assessing needs and if organisation can meet them To clarify job, duties etc. To identify own potential and how to fulfill it (Hunt 1992) HRM3 - Performance Management
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Perceived Benefits of P.A.
MANAGER Learn about employee now & future Goal clarification Measuring work performance Motivate employee Clarification COMPANY Succession planning Facilitate HRP Link business and individual objectives Improve communications overall Improve performance both individual and organisational Evenden & Anderson (1992) HRM3 - Performance Management
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Perceived benefits for employee
Receive feedback Communicate views Career options Recognition Training & development needs Evenden & Anderson (1992) HRM3 - Performance Management
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Performance Appraisal 3 principal objectives
To motivate staff and improve performance thru objective & target setting To assess employee performance and distributing pay To identify training & development needs as well as career aspirations Fletcher (1993) HRM3 - Performance Management
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Methods (techniques) of Appraisal
*Rating Ranking Paired comparison Critical incident *Free form *Performance or objective oriented systems Assessment centre Self-assessment *360º feedback HRM3 - Performance Management
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HRM3 - Performance Management
Rating Appraiser of appraise Against predetermined scale Uses a series of relatively standard headings Often part of a results oriented schemes /objectives based scheme Armstrong (1995)convenient but ignore the complex set of variables that deter. Work performance. Very subjective HRM3 - Performance Management
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HRM3 - Performance Management
Rating continued Problems with consistency across managers Error of central tendency Forced distribution using the normal distribution curve Or Forced choice technique BARS – Behaviourally anchored rating scales HRM3 - Performance Management
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HRM3 - Performance Management
Free form Completely unstructured Allows for discretion Can create many inconsistencies Does not allow for effective comparisons Some managers like structure HRM3 - Performance Management
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Performance/Results/Objective Oriented
MBO Measured against previously agreed KRA’s Jointly set Manager must understand the employee’s job Manager must be committed to observation, feedback, target setting etc. Difficult in a job that is subject to a lot of variation Dificult in a job where you are very dependent on other jobs Quantity versus quality issue HRM3 - Performance Management
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360 º Feedback/Multi Rater Assessment
Relatively new To give a multi dimensional overview of an employee’s performance Structured questionnaires completed anonymously Can be done on computer May require more training HRM3 - Performance Management
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Article: Its time to appraise our methods of appraisal
Questions What are some of the criticisms of appraisal interviews? What does the article say about how to improve appraisal? HRM3 - Performance Management
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Difficulties with Appraisal
9 Common appraisal errors -Grote (1996) Contrast effect First impression Halo/Horns Similar to me Central tendency Negative & Positive skew Attribution bias Recency Effect Stereotyping HRM3 - Performance Management
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Difficulties with Appraisal
Hunt (1992) Poorly designed Over-ambitious Inadequately resourced No training No guidelines HRM3 - Performance Management
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Difficulties with Appraisal
Torrington & Hall (1995), Fletcher (1993) conflicting purposes of PA Line manager sees it as a HR thing (Grint,, 1993, Torrington & Hall 1995) HRM3 - Performance Management
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How to minimise these difficulties
4 Core Obligations of Management -Longenecker & Ludwig (1990) Sound procedure Training Top level support Audit HRM3 - Performance Management
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Types of Appraisal Interview
Tell and sell Tell and listen Problem solve Contingency approach (Norman Maier 1958) HRM3 - Performance Management
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HRM3 - Performance Management
TASK When would it be appropriate to use the different types of approach to the appraisal interview? (Tips: think about the type of appraiser/appraisee, nature of the business/organisation, availability of resources/time, what the appraisal will be used for) HRM3 - Performance Management
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Interview Format: Introduction
General discussion, present level of success The body Self-criticism Self-help Conclusion Confirm decisions, commitments, agreements, recommendations HRM3 - Performance Management
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Effective Appraisal Interviews
Start with purpose Establish rapport Main tasks and responsibility discussion Focus on work targets and standards Encourage self analysis Career aspirations, training needs discussion Manage expectations Summary Notes Follow up Evenden & Anderson (1992) HRM3 - Performance Management
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Guidelines for the Appraisal Interview
Emphasize positive aspects Emphasize improvement Privacy/Confidentiality Regular basis Criticisms: specific & constructive Stay calm Identify specific actions which need to be taken Emphasize assistance End by stressing the positive aspects of performance HRM3 - Performance Management
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Read article: A lovely audience
Pick out key points from the article, about how to conduct the appraisal interview that have not been discussed on the previous slides. HRM3 - Performance Management
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Extra Reading – all in Moodle!
Chapter 8 in core text book CIPD Factsheets: Performance Management Performance Appraisal 360 degree feedback Class handouts/articles Human Resource Management
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Typical Exam Questions
Discuss the characteristics of good and bad performance management systems. Outline the steps to be taken to ensure a successful appraisal interview “Performance management is the same as performance appraisal.” Discuss. Describe any three methods of appraisal. Why is it important to manage & appraise performance? Discuss this from the employer, employee & company perspective. Evaluate the effectiveness of the appraisal interview in the context of performance appraisal. HRM3 - Performance Management
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HRM3 - Performance Management
Autumn Paper 04/05 Discuss the characteristics of good and bad performance management systems. (20 marks) Describe THREE key errors associated with appraisal interviewing (10 marks) Summer Paper 04/05 Explain what a performance management system is (10 marks) Discuss the criticisms of performance management systems and what an organization can do to overcome them. (20 marks) HRM3 - Performance Management
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