HR Final

What are the subdivisions of fair hearing?

-Formal Review ( in order to give feedback) -Employee Participation ( in order for employees to express their opinions regarding their performance) -Supervisor Job-related knowledge (Supervisor must be knowledgable about the job)

Why a section on Global HRM?

-Globalization & global economy -International expansion & competitive advantage -More international/MNC/Global firms -Global changes (Trade agreements, growth of Asia) -Talent management issues

Role of Participation

-Important because it increases buy-in and ownership. -Reduces differences in opinion and facilitate open conversation. - Key predictor of appraisal reactions and directly affect how employees respond to feedback.

What are the challenges to performance appraisal?

-In US it is referred to as the "achilles heel of HRM"-because often unsuccessful with meeting their goal. -PM is an administrative burden and not taken seriously. ( take up time and waste resources) -Reluctance to exchange candid information because in US we have egos. Hard for people to give critical feedback. -Judgement and time factors. ( managers are very busy and lack the time to observe, monitor and recall performance at time of evaluation) we are also subject to biases and distortions when decision making. -negative or highly variable reactions.

What are the subdivisions of Adequate notice?

-Knowledge of standards (through organizational publication and dissemination of standards) -Frequent Feedback (in order for employees to perform to expectations)

Total Compensation

-Made of cash compensation (base wages/salary, merit/cost of living, short-term incentives and long term incentives- those three are pay by performance. -Benefits(Income protection, which is retirement plans and health insurance, Work/Life Balance, which is paid time off and Allowances)

What was the methodology , nations studied and data for hostess cultural dimensions?

-Methodology Survey questionnaire (most valid?) Original IBM Sample (generalizability) -Measurement (construct validity - mismatch) Nations to study None that are more 'multicultural' -Data Absence of certain years

Trompenaars

-Neutral vs. Affective: emotional displays vs. rational arguments (e.g., UK, Germany vs. Italy, France) -Universalism vs. Particularism: attitudes towards universal truths -Achievement vs. Ascription: status based on achievement vs. characteristics (e.g., U.S., U.K. vs. France, Japan) -Specificity vs. Diffuseness: separation of private vs. public spheres of life (e.g., U.S., Germany vs. Argentina, China) -Sequential vs. Synchronic - time is linear, definite vs. multiple & diffuse (e.g., U.S., Germany vs. Argentina, Japan) -Inner vs. Outer Directedness control over the environment (e.g., U.S., Israel vs. China, Russia).

What are the subdivisions of Judgement based on evidence?

-Supervisor Neutrality/Lack of Bias ( without bias towards a particular employee) -Valid Rating Instrument (should be based on valid performance dimensions) -Job Relevant Factors ( rated based on objective job-relevant performance dimensions) -Appeals process ( opportunity for employ to appeal their performance) Unlike adequate notice and fair hearing managers do not have as much control over the instrument that they use and whether or not there is an appeals process in place is usually determined at the business unit or department level, not by an individual manager.

Instrumental Voice

-decision control perception that one has influence on the process and rating.

From pay policy: - what are the major three sets of objectives?

-efficiency (maximize performance while keeping costs low) -fairness ( must be perceived as fair by the employee) -compliance ( consistent with laws)

What is pay determined by?

-knowledge/skills involved -working conditions - value addition to the company

World is Flat -According to Friedman and 'The World is Flat', what is the major source of globalization today in globalization 3.0? -Why is this important to you?

1.0- from size large to size medium ( went global through your country)- 1400-1820 2.0- from size medium to size small ( defined by companies)- 1820-2000 3.0-from size small to size tiny (spearheaded by individuals) 2000-present Now- competition and collaboration are done and the individual levels. Collaboration with one another.

Culture -what are its forms?

Adler-"A way of life of a group of people" It is MULTIDIMENSIONAL forms: language, customs, laws, beliefs, and artifacts. Shared by members of a given social group and is passed on through generations Shapes behavior...structures one's perception of the world

What is one way to address the issue of being viewed as an administrative burden?

Get buy-in from top management and show value of business appraisals done efficiently.

Link Between Compensation and performance -Strategic compensation can?

Assumption made? -increase motivation and performance - can enhance organizational performance yes! when compensation is strategic, meaning aligned with a firms business strategy .34 correlation between financial reward. -extrinsic and intrinsic motivators are additive.

Key purpose of performance appraisal?

Give employees feedback so as to improve their performance and hence to make organizations more effective. Although it has issues, better to work on it then completely get rid of it.

Why is it important to know if relational or instrumental returns are more popular in a specific firm?

Because this is how the HR can then go about intervening into the review process. If more instrumental than put more efforts to help managers develop perceptions of participation in employees and help them to understand their performance ratings better. However, from meta-anyalisis, relational is was more supported.

Benchmark Jobs

Benchmark jobs are those that are common across employers or not unique to a single employer, where the content is stable and well-known

From these four, what is most motivating? a) Cash comp b) Supportive Coworkers c) Challenging work d) Commute work

Challenging work- because of relational return

Compensable factors

Characteristics of jobs we want to pay for (education, difficulty of work, responsibility) basically characteristics of work that are of value to a firm and that will be the basis of pay differences. (skills, effort and responsibility) Are generic factors that are useful across all jobs. A con is that they aren't very specific to any particular firm. Example of a firm with more specific factors: Whole Foods competes based on customer service, knowledgeable staff, high quality products. It is en egalitarian firm where work is organized in small teams. What types of work factors would be relevant to this firm? Obviously, factors like customer service and teamwork would be important to include. In general, factors should be chosen based on the content of work itself - so the content of the work of the different types of jobs being evaluated - as well as the firms strategy, culture and ways of organizing work.

Why do we appraise performance? -4 reasons

Cultural- meritocracy (shared belief that we should get out what we put in) Administrative- in order to keep documentation Legal- protection from layoffs or other promotion decisions. HRM- connection to other systems. 1) to decide who gets promotion 2) who needs training.

What are the two paradigms that can help improve appraisal review by improving reactions?

Due process model of performance appraisal & the social context of performance appraisal

Fair hearing

Employees are given a review/hearing regarding their performance rating Employees are given an actual review session, and that they have opportunity to present evidence on their own behalf, which means to defend themselves. - it should involve participation -in order to be fair manager/rater needs to be familiar with the employees job in order to evaluate.--- ----Within Due-process----

External Competitiveness

External Equity Compensation relationships external to the organization: comparison with competitors -pay decisions are based almost exclusively on what the market is doing. firm is more concerned about pay relative to competitors for jobs, and not so much about the relative value of different jobs to a particular firm and its strategy.

Pay for performance? is it a good method?

Firms that emphasize pay for performance outperform those that emphasize entitlements, Pay for performance signals a movement away from entitlements - i.e., base wages and benefits - and is meant to increase performance by providing an incentive effect -Pay is variable in that it needs to be reearned.

What has increased over time through globalism?

Foreign direct investment, sales of foreign affiliates and employment of foreign affiliates are all increasing over time. Therefore Multinational companies are increasingly influential.

What techniques are used in external competitiveness? -What does it lead to?

Market Definitions, Surveys, Policy Lines >PAY STRUCTURE

Power distance

How culture deals with hierarchical power relationships. High: accept hierarchical order where everybody has a place and needs no further justification. Low: people strive to equalize the power distance.

Performance appraisal- US vs India

If affect is a source of bias positive affect should increase ratings of low performers Negative affect should lower ratings of high performers In US this is not the case INDIA- positive affect increased ratings of lower performers But did not lower ratings of high performers.

Cultural Values

Important and enduring beliefs or ideals shared by the members of a group/society about what is good or desirable and what is not. - values represent basic convictions that make judgments about what is the best mode of conduct or end-state of existence.

What is true about relationship quality?

In general, higher quality relationships are related to more favorable reactions. -also related to higher performance ratings. -also predicts appraisal participation.

Hofstede's cultural dimensions.

Individualism/collectivism Power distance Uncertainty avoidance Masculinity-feminitity Long-term/short-term orientation

What are the three pay polices?

Internal Alignment, External Competitiveness, Employee Contributions

Internal Alignement

Internal Equity-different jobs in the same organization have different levels of value to that organization and should be paid accordingly. Internal analysis of the jobs in the company -Boeing= Engineers - General Mills = Marketing Comparisons among jobs or skills inside the single organization?

What is job evaluation based on?

Job Content Skills required Value to the organization Organizational culture External Market

Relational returns

Learning opps, Challenging work, Employment security, and recognition and status. (Opportunity for challenging work, training and development, support from peers)

What is pay systems role with business strategy?

Must support it and when business strategies change so should the pay system. -different firms with different external environments and with different internal strengths and weaknesses could and should have different compensation strategies IBM changed to a pay for performance environment.

Can extrinsic motivators reduce intrinsic motivation?

No! Individuals are motivated by both extrinsic and intrinsic motivators. - We are know that: Adding extrinsic rewards to an intrinsically motivating task can increase overall motivation. So this also helps us to understand if there is a link between compensation and performance.

Pay for performance?

On average, helps firms gain competitive advantage. -Firms are increasingly looking to pay for performance as a way to increase flexibility and respond to competitive pressures. It depends on the type of pay for performance plan and how it is implemented.

What is performance appraisal apart of?

Performance Appraisal is part of Performance management (broader organization level) -Connect to higher-level goals help connect business-level goals to department-level goals and to employee-level goals.

The performance mgmt process

Performance appraisal is a system with different mutually reinforcing parts and processes. It is a cycle and on-going. Determination of Org's strategy and goals: (POEPP) >Performance planning ( manager discuss goals with employee, must support higher level goals) >Ongoing feedback ( so employee understands how they are doing and what needs to be improved) >Employee input ( employees view on how they work should be done, and needs to be changed to improve performance >Performance Evaluation (ratings that will be used in the discussion) >Performance Review ( should influence employee goals for next time)

Judgement based on evidence

Performance ratings are based on objective performance-related factors.

How are frequent feedback and knowledge of performance standards related to appraisal reactions?

Positively! Frequent feedback actually enhances the relationship between knowledge of standards and appraisal reactions.

Key takeaways from relationship quality?

RQ matters and employees should perceive their manager as supportive, trustworthy and satisfactory in terms of their relationship. However many people are focusing on accuracy. However when it comes to reactions and legal defensibility-what is sometimes more important is how employees are treated.

What is compensation? -what does employer get in exchange?

Refers to all forms of financial returns and tangible services and benefits employees receive as part of an employment relationship. This is in for the exchange of the employees time, effort and productivity. Research has shown that managers underestimate employee's intrinsic motivation and therefore rely to heavily on extrinsic factors.

When deciding between rating (.38), extent of participation (.45), and relationship quality itself (.63). Which one will be best predictor of appraisal reactions?

Relationship quality is most correlated with appraisal reactions

Relationship quality and reactions

Relationship quality is relevant to motivation and job performance. Key predictor of variables relevant to performance appraisal.

Which do you think is the best predictor of appraisal reactions: one's performance rating, the extent to which one participated in the review, or one's perception of relationship quality with one's manager?

Relationship quality! It is most strongly related to appraisal reactions followed by participation, then performance ratings.

When deciding between relationship itself and relationship quality because of additional resources, which would we choose? ---Another way of phrasing: Do employee ratees feel that relationship quality is important in and of itself? Or is it important to employees largely because of the benefits to them Opportunity to participate and better ratings

Relationship quality. -Therefore managers should be more trained in developing relationships and trust with their employees.

Predictors of reactions to appraisals

Relationship with manager, due process, extent to which appraisals are fair, performance ratings, participation.

Employee participation - Goal setting

Review goals for the performance planning phase and discuss goals for next performance cycle.

Type of employee participation

Self-appraisal discussion Goal-setting Value-expressive voice (They are correlated but not mutually inclusive or exclusive) Instrumental voice Two-way communication Time talked

What techniques are used in Employee contributions? -What does it lead to?

Seniority based, performance based, merit guidlines

Lockheed Martin Example

Shows that Consultant engineers make the most because not only because of higher content: that is, the job requires more experience, more education and training and perhaps more specialized knowledge than other jobs BUT ALSO it is disproportionally more valuable. -it is responsible for coming up with new ideas-leading innovation for the firm making it the most valuable job based on its industry.

Due process model of performance appraisal? What are the three categories?

Similar to constitutional rights- right to a fair trial. In general they are objectively fairer and perceived more favorably. Adequate notice Fair hearing Judgement based on evidence

What is a supervisor-subordinate relationship measured by?

Supervisor-subordinate relationship quality is typically operationalized or measured in terms of perceptions of support, trust, and relationship satisfaction.

What has a higher effect on Relationship Quality: Job performance or Surface level relationship? Difference between surface and deep level relationships?

Surface level relationship Deep= values and personality Surface level= religion, gender and race

Reactions to Appraisals

Talking about how fair the person thought it was, rating accurate and if they were satisfied with their review. When employees react better to appraisals = better performance. ( reactions directly predict performance) Are usually bad. less than 40% increase improvement in performance 60% decrease. Two types: Due process and social context Do we need to know this type as well?

Long-term/short-term orientation

Tendency of a culture to focus on long‑term benefit or short‑term outcomes. Low: maintain time-honored traditions and norms while viewing societal change with suspicion. High: more pragmatic approach and encourage thrift and education to prepare for the future.

Criteria: Value

The worth of the work. Its relative contribution to the organization objectives. focuses on - relative contribution of these skills, tasks, and responsibilities to the organization's goals Can include external market value)

IBM

There comp changed once their environment changed now it changed to performance based from job based structure. When firm changes strategy then look to compensation.

Order of pay model decisions

Think about objectives ( efficiency, fairness, compliance) > what policy ( internal alignment, competitiveness, contributions) > techniques.

Pay policy model

Useful guide or structure for for thinking about compensation in organizations more broadly. Shows us how the three different pay policies fit in with our objectives. Are objectives shape our pay polices. Decisions impact what techniques ( job eval for internal aligned not for competitiveness) we choose. -once we choose a policy this will determine the types of pay practices we will go with and we must evaluate there effectiveness.

Is Value expressive of instrumental voice more important for employees?

Value expressive is more strongly correlated with appraisal reactions -because people want to feel liked and listened to. -supervisors are in control of basically every dimension of adequate notice and fair hearing.

Jobs that want to be internally aligned what should they base their differentials on?

Value- jobs that are worth more should be paid more.

What techniques are used in internal alignment? -What does it lead to?

Work analysis, descriptions, evaluation/certification. Also Job evaluations > INTERNAL STRUCTURE

Levels Why are they important?

a certain amount of pay associated with one or more jobs -Levels are also important because they represent not only differences in pay potentially, but differences in status and power as well -when there are a lot of levels in a firm this gives employees a sense of career progression. Promotions are motivating even without a pay differential.

Manger ratings for above, average, below

above-46.4 average-49.0 below- 4.6

criteria What are the two components?

are used to determine differences between levels Content and Value

Self appraisal discussion

best if narrative and no grade given in order for employee to not be wedded to a particular performance rating. structured way of getting participation

Globalization

definition: the process of international integration arising from interchange of world views, products, ideas and other aspects of culture. - It blurs country boundaries in business activities and enables international joint ventures and partnerships. -international trade has, over the last 50+ years, consistently exceeded growth in production in major developed economies.

internpersonal affect

degree to which a manager likes someone ( socialize and be around)

Uncertainty avoidance

describes how cultures seek to deal with the fact that the future is not perfectly predictable, and the degree to which people in a culture prefer structured over unstructured situations. High: maintain rigid codes of belief and are intolerant of unorthodox behavior or ideas. Low: a more relaxed attitude in which practice counts for more than principles.

Masculinity-femininity

describes the division of roles between the sexes within a society. US=highly masculine, clear roles of what women need to do. France-Feminine

Levels: reporting relationships

determined by where the meaningful differences are in the nature of work and also where there is a need for reporting. ex) generalists report to the HR manager

What are some things cultures differ on?

differ strongly on such things as how subordinates expect leaders to lead, how decisions are handled, and what motivates people. -how managers behave in relation to subordinates - influence appropriateness of HRM practices. - Influence compensation systems. - Can also affect the communication and coordination processes in organizations.

Adequate Notice

employees are held accountable for performance standards they understand. Give both knowledge of standards and frequent feedback. Closely parallels to the planning and ongoing feedback parts of the performance appraisal system. When treated like a system and handled with care, performance appraisals will be more effective.

What are employees more interest in getting out from a review?

employees are more interested in relational returns (trust and support) from the review than instrumental returns ( good ratings and opportunity to participate)

What are some ways of insuring that employees know what standards they will be held accountable for?

including employee manuals; giving employees descriptions of their jobs; goal-setting with employees during performance planning - give frequent FEEDBACK

Compensation -Conclusions

is an important part of a total returns package or of an employment relationship. -When compensation policies and practices are designed to be supportive of a firm's strategy, culture and unique internal strengths and weaknesses, compensation tends to provide firms' with a source of competitive advantage - some firms try to do all three polices. -Pay surveys are a method of determining value of jobs as compared to the external labor market. -Some firms organize parts of their workforce around individual persons. ( auto assembly workers today)

What has lead to globalization?

is influenced by satellite transmissions, Internet businesses, fiber optics, computers, work locations, free trade agreements (e.g., NAFTA), ATMs, 24/7 atmosphere, multinational enterprises and so on, among other factors.

differential

is the difference in pay between levels -determined by content ( working conditions and KSAO's to do the work and internal value.

What is the purpose of differentials?

is to motivate individuals to work hard to get promoted to higher paying levels.

Why is globalization important?

it impacts business and the way business is done. - when it comes to talent management a company's potential for finding and minting qualified work is a critical element of any decision to expand internationally. (countries differ in their levels of human capital)

Point Method

most common method 1st step is to determine the compensable factors basically characteristics of work that are of value to a firm and that will be the basis of 1)Compensable factors 2)Factor degrees numerically scaled 3)Weights reflect relative importance of each factor Differ from other methods by making explicit the criteria for evaluating jobs - compensable factors

Job Evaluation - what about its process?

process of systematically determining the relative worth of jobs to create a job structure for the organization -helps determine the differences for internal alignment -goal to ensure that pay differences are reached in a useful fair way - its systematic and standardized, however decisions are made based not only on results from a standardized process, but on the judgment of a committee. - it is way more of a participatory process with extensive debate and negotiation. -before it was all done based on judgement and individual discretion. A job evaluation involves a form, much like a performance evaluation review would IN job evaluation we are talking about evaluating the relative worth of jobs - and not an individual's performance in a job

Pay structure

refers to the array of pay rates for different work or skills within a single organization -they are hierarchical in nature -The number of levels, the differentials in pay between the levels, and the criteria used to determine those differences describe the structure.

Employee Contributions

relation emphasis placed on employee performance. -effect fairness. This can be at the individual, team, business unit or firm levels of analysis. This is know as variable pay or pay for performance, -Usually the base wages are lower.

Individualism/ Collectivism

the strength of the relation between an individual and other individuals in the society, that is, the degree to which people act as individuals rather than as members of a group. US-Individualism Japan-collectivism

Value expressive voice

voice for the sake of voice -perception that one has been truly listened to

What does reactions to appraisals usually mean?

we are usually talking about employee perceptions of the extent to which their appraisal was fair, their rating was accurate, and they were satisfied with their review.

Total Returns

what employee will receive in return as part of the employment relationship.

What jobs are associated with higher base wages?

when they are more demanding, when they are more responsible or require more problem solving, when working conditions are hazardous or undesirable, such as when work is dangerous or with shift work.

Criteria: Content

work performed in a job and how it gets done. (Structure ranks jobs on - skills required, complexity of tasks, problem solving, and/or responsibility)