Performance Management Grote Text

1. organizational readiness 2. systems integration 3. training 4. evaluation

(DDI & SHRM) To improve performance management, organizations need to focus on 4 areas:

Quality

-Customer complaints and compliments -Error rate or rejects -Compliance with specifications -returned goods -internal feedback and reports

Time

-Due dates -Adherence to schedule -cycle times -deadlines -reduction in number of class days required for certification -average call response time -projects completed per month -number of minutes before initial contact with physician

Quantity

-Number of units produced -Calls per hour -New products introduced -Garbage cans emptied -Grievances per 100 employees -Mileage per replacement tire

Cost

-Variance against budget -Dollars spent -Ratio of product cost to maintenance cost -waste -overtime incurred -profit per item

Benefits of separating out the components of effective supervision

-Without a great deal of additional burden, it allows appraisers to concentrate on assessing the individual components of the supervisory job -It provides an organizations supervisors information on precisely the areas where the company expects them to expend efforts and achieve success. -It allows the individual who has supervisory responsibility as only part of the job to be appraised separately on both elements of performance: as an individual contributor and as a supervisor of the performance of others. -The activity involved in determining the list of appraisal items for supervisors is useful in generating a thorough understanding of the job and may highlight areas where additional training and development efforts are needed.

4 Elements in measurable objectives

1) An action verb 2) A statement of results 3) A time target 4) A standard of performance

Benefits of BARS

1) High degree of rater/ratee acceptability. 2) high reliability and validity 3)Helps provoke good discussions 4) Produced immediate performance improvements

Performance assessment (phase 3)

Appraiser and appraisees independently evaluate the degree to which the different elements of the plan were achieved. The manager completes an assessment of the subordinates performance and typically has it reviewed and approved by senior management and HR personnel before discussing it with the subordinate. The subordinate may submit the self-appraisal to the manager to be used as part of the managers overall assessment.

Key Points for Conducting a Coaching Session

Before the meeting 1. Determine desired and actual performance 2. Determine the good business reasons that the problem must be solved 3. Determine the logical consequences if the problem continues 4. Determine the appropriate action step During the meeting 1. Confirm that the planned action is appropriate 2. gain the EEs agreement to change 3. Determine the action the employee will take After the meeting 1. Document the discussion 2. Follow up to make sure that the problem has been solved

Meeting logistics

Begin by arranging all of the details of the meeting. Set a time convenient for both of you. Conduct meeting in a business setting.

It points out where the organization should be placing its emphasis: on selection, not on development

Benefit of considering trainability

Competencies

Broad area of skills, abilities, and behaviors. An underlying characteristic of an individual that is casually related to criterion referenced effective and/or superior performance in a job or situation.

-Number of job families -Relevance to the nature of the job -Impact on job success -The organization's mission -Senior management direction -Need for change and organizational redirection

Considerations when determining which competencies should be included in the list for appraisal:

Step 1: Collect Appraisal Data

Describes the job itself.

Behaviorally Anchored Rating Scale

Designed to appraise a specific job. 1) Call a meeting of all the people in the job and their supervisors to ask them to make a list of the most important dimensions of the job. 2) Generate examples of effective, average, and ineffective behavior. 3) Connect the various behaviors to the appropriate dimensions. 4) Scaling. Each behavioral example is anchored to a rating scale at the point along the scale that represents its degree of "goodness" or "badness"

Appraisal writing checklist

Developed by Kay Cox. This helps line managers in her organization make sure that they have completed the job of writing appraisals at the level of good solid performance and perhaps superior. (p. 145)

-Ownership -Bad news -Adverse impact -Scarce rewards -Personal reflection

Factors causing antipathy toward performance appraisal systems

-Focused on specific results to be achieved -Written in crisp and concise statements -Stated forcefully -Significant -Prioritized -Limited in number -Fully communicated -Written in quantifiable statements that can easily be measured and reported

Objective guidelines to make sure they are comprehensive and complete:

Competencies and performance factors vs objectives and work outcomes

Objectives change. Performance factors do not.

-Review the list to make sure that each accountability deals with a discrete and non overlapping part of the job. -Review the list to make sure that no significant issues or responsibility areas have been overlooked -Review the list to make sure that the accountabilities assigned to the job are appropriate.

Once all of the jobs accountabilities have been identified:

Critical Incidents

Situations in which employees acted in ways that were either especially effective or especially ineffective in accomplishing parts of their jobs. Difficult and time consuming.

Advising the employee

Start by meeting with each subordinate well in advance to explain the process and your expectations.

systems integration

The performance management systems must be fully integrated with other systems and organizational objectives. Alignment is critical since it ensures that all systems affected by the overall performance management system (training, compensation, management development, selection, manpower planning, strategic planning) support it- or at least don't undermine it. Make sure that individual, team, and department objectives link with the organizations overall business strategy and values.

Training

The report encourages organizations to commit to a high level of training for appraisers and appraisees alike. Managers and employees must be taught how to allocate responsibility, set objectives, identify key behaviors, and track and measure performance. Managers need training in interpersonal and coaching skills.

First impression error

The tendency of a manager to make an initial positive or negative judgment of an employee and allow that first impression to color or distort later information

Contrast effect

The tendency of a rater to evaluate people in comparison with other individuals rather than against the standards for the job

Similar to me effect

The tendency of individuals to rate people who resemble themselves more highly than they rate others

Recency effect

The tendency of minor events that have happened recently to have more influence on the rating than major events of many months ago.

Attribution bias

The tendency to attribute performance failings to factors under the control of the individual and performance successes to external causes

Stereotyping

The tendency to generalize across groups and ignore individual differences.

1. Collect the appraisal data 2. Evaluate the performance 3. Write the review

3 Step Process of Generating a performance appraisal

Benefits of results based appraisal approaches

1) It produces improved short and long term planning 2) The focus on results communicates the importance of achieving measurable results to all members of the organization 2) The system encourages more effective performance 4) both appraisers and appraisees accept the approach as fair 5) It results in increased commitment to the organization 6) Results based approaches lead to improved clarity of the individuals role and priorities 7) Results based systems are highly defensible

Problems of results based appraisal approaches

1) May be excessively results oriented 2) It may be inflexible 3) It is neither easy to create nor easy to use 4) The approach may not provide adequate personal incentives to improve performance 5) It may not fit all aspects of a job

Weaknesses of BARS

1)Difficult to develop anchors. 2) Difficult to develop dimensions that are complete and contain no overlap. 3) Difficulty in assigning the actual performance of the individuals they supervise to the highly specific behavioral examples used to anchor the various points on the form. 4) The process requires the appraiser to keep an extensive diary of employee behaviors throughout the appraisal period. 5) Expensive to create 6) Extensive appraiser training 7) Behavior based 8) No evidence that this method is more accurate or valid than another method

Data on the jobholder

1. Objective data 2. Critical incidents 3. Behavioral observations

Determining the final rating

1. Review all of the interim ratings you have made in preparing the appraisal. 2. Review the core message you determined when you began the evaluation process and thought about what you wanted the employee to remember a month or two after the appraisal process was completed 3. Consider weighting the various parts of the appraisal.

1) Identify the key accountability areas for the position. Typically 5-7 2) Within each accountability, draft a series of possible objectives that, if achieved, would significantly increase organizational effectiveness and success within that accountability area 3) Test each potential objective 4) Based on the outcome of the bests in step 3, select a smaller number of significant goals or objectives to be achieved within the appraisal period. 5) Write each objective in a clear, concise, and unambiguous statement of the end result to be achieved 6) For each objective develop complete and appropriate mechanism to measure goal attainment 7) For each objective determine the level of performance required to achieve a performance rating of Fully Satisfactory 8) Determine appropriate milestones or checkpoints for assessing progress toward goal achievement over the course of the appraisal period. 9) Communicate these objectives to all other individuals who may be sources of information or assistance in achieving or revising the objective 10) Begin the process of achieving the objectives, reviewing progress at predetermined checkpoints, and revising objectives as conditions and requirements change over the course of the appraisal period.

10 Key steps in creating results based assessment in an existing or new performance appraisal system:

1. Look: maintain eye contact. Lean toward the individual and look at him/her. 2. Nod: Move your head up and down while the other person is talking. 3. Grunt: Use verbal encouragers such as huh huh, oh, really, I see, and yeah. Can indicate you are paying close attention 4. Pause: don't interrupt. Be quiet and let the other person talk.

4 Fundamental rules for listening

-quantity -quality -cost -time

4 direct measures of output:

1. Committing to goal achievement 2. Soliciting performance feedback and coaching 3. Communicating openly and regularly with manager 4. Collecting and sharing performance data 5. Preparing for performance reviews

5 major activities in the management of personal performance in an organization

1. Contrast effect 2. First impression error 3. Halo/horns effect 4. Similar to me effect 5. Central tendency 6. Negative and positive skew 7. Attribution bias 8. Recency effect 9. Stereotyping

9 Common Appraisal Errors

1) A definition 2) A description of specific behaviors that can be observes when someone demonstrates a competency effectively 3) A description of behaviors that are likely to occur when someone does not demonstrate a competency effectively 4) A list of suggestions for developing the competencies

A description of a competency includes:

Central tendency

The inclination to rate people in the middle of the scale even when their performance clearly warrants substantially higher or lower rating

1. Get EE more involved in the design, development, and administration of the system. Participation creates ego involvement and a sense of commitment to the process. 2. Invest more heavily in training raters to use the system. Train managers not only to observe and document performance but also to communicate information effectively and deliver performance feedback. 3. Create an environment in which performance information is viewed as a resource that managers can use to develop subordinates. Top managers must create a climate in which accurate and timely performance appraisal is expected of all managers, is taken seriously, and is rewarded. 4. Make performance appraisal the responsibility of the rates, not the rater. Takes off the burden to be nice. 5. Use multiple perspectives (multiple raters), including peer evaluation, to reduce the reliance on a single source. This reduces sampling error and makes raters more comfortable.

Bretz and Milkovich 5 Recommendations for improving perf appraisal

Objective data

Facts. Quantifiable. Does not reveal whether the performance was good or bad. Usually the easiest to collect and discuss.

Goal setting

If your procedure needs work in the area of increasing the emphasis on results or work outcomes what do you focus on?

Halo/horns effect

Inappropriate generalizations from one aspect of an individual's performance to all areas of that person's performance.

Opening the discussion

Lay out a road map for the individual, describing your agenda for the conversation and the order in which you plan to cover things.

1) Formulate long-range goals and strategic plans. 2) Develop overall organizational objectives 3) Establish derivative objectives for major operating units. 4) Set realistic and challenging objectives and standards of performance for members of the organization 5) Formulate action plans for achieving the stated objectives 6) Implement the action plan and take corrective action when required to ensure the attainment of objectives 7) Periodically review performance against established goals and objectives 8) Appraise overall performance, reinforce behavior, and strengthen motivation. Begin the cycle again.

MBO Process

Performance Execution (phase 2)

Over the course of the year the subordinate executes the plan agreed to in phase 1. During this time the supervisor is responsible for ongoing feedback and coaching. Elements of the plan that become obsolete are abandoned by mutual agreement; new objective to respond to changing conditions are established.

1. They provide systematic judgments to back up salary increases, promotions, transfers, and sometimes demotions and terminations. 2. They are a means of telling a subordinate how he is doing, and suggesting needed changes in his behavior, attitudes, skills, or job knowledge; they let him know "where he stands" with the boss. 3. They are also being increasingly used as a basis for the coaching and counseling of the individual by the superior.

Performance appraisal plans meet 3 needs

Other names for competencies

Performance factors, competencies, success factors, values, quality concepts.

1. Identify the specific gap between desired and actual performance 2. Determine the good business reasons that the problem must be solved. 3. Determine the consequences the employee will face if she fails to correct the situation. 4. Determine the appropriate action to take.

Preparing for a productive discussion

Equity theory

Proposes that individuals are concerned not only with their own situation in an absolute sense but also with how their situation compares with others in the organization. Predicts that the good performer will act to change the situation so that it becomes equitable, with the giving and the getting balanced.

1) What are the different areas in which this individual is expected to focus efforts? (accountabilities) 2) Within each area, what goals or objectives do we expect the person to achieve? (objectives) 3) How will the results that the person produces be measured? How will we distinguish good performance from bad? (performance standards or measures)

Questions needed in order to appraise the results of a person's efforts:

Accountabilities and Measures Approach

Results based appraisal approach that provides for the objectives to be achieved by an individual, together with the measures or performance standards for each objective, to be determined, either completely or in part, by higher management.

Preparing physically

Take a brisk walk and practice deep breathing - it can help handle stress. Do this if you anticipate stress during the meeting.

-Phase 1: Performance planning -Phase 2: Performance execution -Phase 3: Performance Assessment -Phase 4:Performance review -Phase 5: Performance renewal and recontracting Before any of the phases can begin: A mission and overall objectives have to be clear.

The Ideal Performance Appraisal Cycle

A Performer -> In a given situation -> Engages in certain behaviors -> That produces various results

The Job Performance Model

1. Creating the conditions that generate subordinate motivation 2. Observing and documenting performance 3. Updating and revising initial objectives, performance standards, and job competency areas as conditions change 4. Providing performance feedback and coaching when problems or opportunities arise 5. Providing developmental experiences 6. Reinforcing effective behavior and progress toward goals

The Manager's Responsibilities in Performance Management

Performance Planning (Phase 1)

The appraiser and appraisees meet to plan the upcoming year. They come up with 1) key accountabilities 2) the specific objectives 3) the standards 4) the performance factors 5) the elements of the development plan

Performance Review (phase 4)

The appraiser and appraiser meet to review their appraisals. They discuss the results that were achieved and the performance factors that contributed to their accomplishment. This phase is the delivery and discussion. Discussion includes: results achieved, performance effectiveness, overall performance assessment, and development process.

Accountabilities

The broad areas within a job that change little from year to year. ex: job description. They function as labels: They identify the areas within which a person is responsible for achieving results and sorting the broad areas of the job into more discrete chunks.

Rating error

The difference between the output of a human judgment process and that of an objective, accurate assessment uncolored by bias, prejudice, or other subjective, extraneous influences.

Evaluation

The effectiveness of a performance management system can best be ensured if managers are held accountable for using it effectively. The quality and timeliness of performance reviews should be spot-checked at a minimum. In addition to requiring midyear and annual reviews, effective organizations demand that part of a manager's annual appraisal be devoted to how well he used the system with his subordinates.

Performance renewal and recontracting (phase 5)

The manager and subordinate revise any of the subordinate's key accountabilities that may have changed over the year and set new objectives and standards for the upcoming appraisal period. Finally, they create updated development goals and action plans.

Skills

The measurable and observable abilities that have been developed through practice, training, or experience.

Management By Objectives (MBO)

The most common results based approach to performance appraisal. Orderly, step by step procedure for ensuring organizational excellence and desired results. Philosophy is formation of trusting and open communication throughout the organization. Mutual problem solving and negotiations in the establishment of objectives. Creation of win win relationships. Organizational rewards and punishments based on job related performance and achievement. Minimal use of political games, force, and fear. Development of a positive, proactive, and challenging organizational climate.

Negative and positive skew

The opposite of central tendency: the rating of all individuals as higher or lower than their performance actually warrants.

organizational readiness

Top management just model appropriate behavior and reinforce the process. Involving employees in developing the system will build ownership. Clearly communicate to all employees how the system works and how it reflects organizational values.

Knowledge

What is in a persons head: a familiarity, awareness, and understanding of a topic or issue.

Describe each competency or performance factor in behavioral terms.

What is the most effective way of defining competencies?