Dessler_HRM12e_PPT_09.ppt

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PowerPoint Presentation by Charlie Cook The University of West Alabama

Chapter 9

Performance

Management

and Appraisal

Chapter 9

Performance

Management

and Appraisal

Part Three | Training and Development

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WHERE WE ARE NOW…

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1.

1. Define performance management and discuss how it

Define performance management and discuss how it

differs from performance appraisal.

2.

2. Set effective performance appraisal standards.

Set effective performance appraisal standards.

3.

3. Describe the appraisal process.

Describe the appraisal process.

4.

4. Develop, evaluate, and administer at least four

Develop, evaluate, and administer at least four

performance appraisal tools.

5.

5. Explain and illustrate the problems to avoid in

Explain and illustrate the problems to avoid in

appraising performance.

6.

6. Discuss the pros and cons of using different raters to

Discuss the pros and cons of using different raters to

appraise a person’s performance.

7.

7. Perform an effective appraisal interview.

Perform an effective appraisal interview.

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Basic Concepts in

Performance

Management and Appraisal

Performance

Appraisal

Setting work

standards,

assessing

performance, and

providing feedback

to employees to

motivate, correct,

and continue their

Performance

Management

An integrated

approach to

ensuring that an

employee’s

performance

supports and

contributes to the

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Defining the Employee’s

Goals and Work Standards

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Setting SMART Goals

• S

_S

pecific, and clearly state the desired results.

• _M

_M

easurable in answering “how much.”

_{easurable in answering “how much.”}

• _A

_A

ttainable, and not too tough or too easy.

_{ttainable, and not too tough or too easy.}

• _R

_R

elevant to what’s to be achieved.

_{elevant to what’s to be achieved.}

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An Introduction to Appraising

Performance

1 Is useful in career planning.

Plays an integral role in performance management.

Why Appraise Performance?

Is basis for pay and promotion decisions.

Helps in correcting deficiencies and reinforcing good

performance.

2

3

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(Un)Realistic Appraisals

• Motivations for Soft Appraisals

_{Motivations for Soft Appraisals}



_{The fear of having to hire and train someone new.}



_{The unpleasant reaction of the appraisee.}



_{An appraisal process that’s not conducive to candor.}

• Hazards of Soft Appraisals

_{Hazards of Soft Appraisals}



_{Employee loses the chance to improve before being discharged}

or forced to change jobs.



_{Lawsuits arising from dismissals involving inaccurate}

performance appraisals.

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Performance Appraisal Roles

• The Supervisor’s Role

_{The Supervisor’s Role}



_{Usually do the actual appraising}



_{Must be familiar with basic}

appraisal techniques



_{Must understand and avoid}

problems that can cripple

appraisals



_{Must know how to conduct}

appraisals fairly

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Performance Appraisal Roles

(cont’d)

_•

_{The HR Department’s Role}



_{Serves a policy-making and advisory role.}



_{Provides advice and assistance regarding the appraisal}

tool to use.



_{Trains supervisors to improve their appraisal skills.}



_{Monitors the appraisal system effectiveness and}

compliance with EEO laws.

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Effectively Appraising Performance

1 Appraising performance

Steps in Appraising

Performance

Defining the job and performance criteria

Providing feedback session

2

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Designing the Appraisal Tool

• What to Measure?

_{What to Measure?}



_{Work output (quality and quantity)}



_{Personal competencies}



_{Goal (objective) achievement}

• How to Measure?

_{How to Measure?}



_{Generic dimensions}



_{Actual job duties}

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Performance Appraisal Methods

1

2

3

4

5 Alternation ranking

Graphic rating scale

Paired comparison

Forced distribution

Critical incident

6

7

8

9

10 Behaviorally anchored rating

scales (BARS)

Narrative forms

Management by objectives (MBO)

Computerized and Web-based

performance appraisal

Merged methods

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TABLE 9–1

Examples of Critical Incidents for Assistant Plant Manager

Continuing Duties Targets

Critical Incidents

Schedule production

for plant

90% utilization of

personnel and machinery

in plant; orders delivered

on time

Instituted new production

scheduling system; decreased

late orders by 10% last month;

increased machine utilization in

plant by 20% last month

Supervise procurement

of raw materials and

on inventory control

Minimize inventory costs

while keeping adequate

supplies on hand

Let inventory storage costs rise

15% last month; over-ordered

parts “A” and “B” by 20%;

under-ordered part “C” by 30%

Supervise machinery

maintenance

No shutdowns due

to faulty machinery

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FIGURE 9–7

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Behaviorally Anchored Rating Scale

(BARS)

_{Developing a BARS}

1.

1. Write critical incidents

_{Write critical incidents}

2.

2. Develop performance

Develop performance

dimensions

3.

3. Reallocate incidents

Reallocate incidents

4.

4. Scale the incidents

_{Scale the incidents}

5.

5. Develop a final

_{Develop a final}

instrument

Advantages of BARS



_{A more accurate gauge}



_{Clearer standards}



_Feedback



_{Independent dimensions}

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FIGURE 9–8

Example of a

Behaviorally

Anchored Rating

Scale for the

Dimension

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Management by Objectives (MBO)

• A comprehensive and formal organizationwide

_{A comprehensive and formal organizationwide}

goal-setting and appraisal program requiring:

1.

1. Setting of organization’s goals

_{Setting of organization’s goals}

2.

2. Setting of departmental goals

Setting of departmental goals

3.

3. Discussion of departmental goals

Discussion of departmental goals

4.

4. Defining expected results (setting individual goals)

_{Defining expected results (setting individual goals)}

5.

5. Conducting periodic performance reviews

Conducting periodic performance reviews

6.

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Using MBO

Setting unclear

objective

Conflict with

subordinates

over objectives

Potential Problems with

MBO

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Computerized and Web-Based

Performance Appraisal Systems

• Allow managers to keep notes on subordinates.

_{Allow managers to keep notes on subordinates.}

• Notes can be merged with employee ratings.

_{Notes can be merged with employee ratings.}

• Software generates written text to support appraisals.

_{Software generates written text to support appraisals.}

• Allows for employee self-monitoring and self-evaluation.

_{Allows for employee self-monitoring and self-evaluation.}

• Electronic Performance Monitoring (EPM) Systems

_{Electronic Performance Monitoring (EPM) Systems}



_{Use computer network technology to allow managers access to}

their employees’ computers and telephones.



_{Managers can monitor the employees’ rate, accuracy, and time}

spent working online.

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FIGURE 9–9

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Dealing with

Performance Appraisal

Problems

Unclear

standards

Leniency or

strictness

Halo

effect

Potential Rating

Scale Appraisal

Problems

Central

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Guidelines for Effective Appraisals

Know the

problems

Get

agreement

on a plan

Use the

right tool

How to Avoid

Appraisal Problems

Keep a

diary

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TABLE 9–3

Important Advantages and Disadvantages of Appraisal Tools

Tool

Advantages

Disadvantages

Graphic rating scale

Simple to use; provides a quantitative

rating for each employee.

Standards may be unclear; halo

effect, central tendency, leniency,

bias can also be problems.

BARS

Provides behavioral “anchors.” BARS

is very accurate.

Difficult to develop.

Alternation ranking

Simple to use (but not as simple as

graphic rating scales). Avoids central

tendency and other problems of rating

scales.

Can cause disagreements among

employees and may be unfair if all

employees are, in fact, excellent.

Forced distribution

method

End up with a predetermined number

or % of people in each group.

Employees’ appraisal results

depend on your choice of cutoff

points.

Critical incident

method

Helps specify what is “right” and

“wrong” about the employee’s

performance; forces supervisor to

evaluate subordinates on an ongoing

basis.

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Choosing the Right Appraisal Tool

Accessibility

Ease-of-use

Employee

Accuracy

acceptance

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FIGURE 9–10

Selected Best Practices for Administering Fair Performance Appraisals

• Base the performance review on duties and standards from a job analysis.

• Try to base the performance review on observable job behaviors or objective

performance data.

• Make it clear ahead of time what your performance expectations are.

• Use a standardized performance review procedure for all employees.

• Make sure whoever conducts the reviews has frequent opportunities to observe

the employee’s job performance.

• Either use multiple raters or have the rater’s supervisor evaluate the appraisal

results.

• Include an appeals mechanism.

• Document the appraisal review process and results.

• Discuss the appraisal results with the employee.

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FIGURE 9–11

Guidelines for a Legally Defensible Appraisal

1. Preferably, conduct a job analysis to establish performance criteria and standards.

2. Communicate performance standards to employees and to those rating them, in writing.

3. When using graphic rating scales, avoid undefined abstract trait names (such as “loyalty” or

“honesty”).

4. Use subjective narratives as only one component of the appraisal.

5. Train supervisors to use the rating instrument properly.

6. Allow appraisers substantial daily contact with the employees they’re evaluating.

7. Using a single overall rating of performance is usually not acceptable to the courts.

8. When possible, have more than one appraiser, and conduct all such appraisals

independently.

9. One appraiser should never have absolute authority to determine a personnel action.

10. Give employees the opportunity to review and make comments, and have a formal appeals

process.

11. Document everything: Without exception, courts condemn informal performance evaluation

practices that eschew documentation.

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Who Should Do the Appraising?

Self-rating

Subordinates

360-degree

feedback

Potential

Appraisers

Immediate

supervisor

Peers

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The Appraisal Interview

Satisfactory—Promotable

Satisfactory—Not

Promotable

Unsatisfactory—Correctable

Unsatisfactory—

Uncorrectable

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Appraisal Interview Guidelines

Talk in terms

of objective

work data

Get

agreement

Don’t get

personal

Encourage

the person to

talk

Guidelines for

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Handling Defensive Responses

1 Recognize your own limitations.

Never attack a person’s defenses.

How to Handle a Defensive Subordinate

Recognize that defensive behavior is normal.

Postpone action.

2

3

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How to Deliver Criticism

1

2

3

4

5 How to Criticize a

Subordinate

Criticize in private, and do it constructively.

Do it in a manner that lets the person maintain

his or her dignity and sense of worth.

Give daily feedback so that the review has no

surprises.

Never say the person is “always” wrong.

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Formal Written Warnings

• Purposes of a Written Warning

_{Purposes of a Written Warning}



_{To shake your employee out of bad habits.}



_{To help you defend your rating, both to your own boss and (if}

needed) to the courts.

• A Written Warning Should:

_{A Written Warning Should:}



_{Identify standards by which employee is judged.}



_{Make clear that employee was aware of the standard.}



_{Specify deficiencies relative to the standard.}

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Performance Management

• Performance Management

_{Performance Management}



_{Is the continuous process of identifying, measuring, and}

developing the performance of individuals and teams and

aligning their performance with the organization’s goals.

• How Performance Management

_{How Performance Management}

Differs

From

Performance

Appraisal



_{A continuous process for continuous improvement}



_{A strong linkage of individual and team goals to strategic goals}

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Basic Building Blocks of

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Why Performance Management?

Total Quality Management

Resolution of Appraisal Issues

Strategic Goal Alignment

The

Performance

Management

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Using Information Technology to

Support Performance Management

• Assign financial and nonfinancial goals to each team’s

_{Assign financial and nonfinancial goals to each team’s}

activities along the strategy map chain of activities

leading up to the company’s overall strategic goals.

• Inform all employees of their goals.

_{Inform all employees of their goals.}

• Use IT-supported tools like scorecard software and

_{Use IT-supported tools like scorecard software and}

digital dashboards to continuously monitor and assess

each team’s and employee’s performance.

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K E Y T E R M S

performance appraisal

graphic rating scale

alternation ranking method

paired comparison method

forced distribution method

critical incident method

behaviorally anchored rating scale (BARS)

electronic performance monitoring (EPM)

unclear standards

halo effect

central tendency

strictness/leniency

bias

appraisal interview

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