Chapter 6 Performance Management

steps in Performance Management system

(Define Performance) (Monitor and Evaluate Performance) (Review performance) (Provide Consequences)

pay for performance rewards

(bonuses) (commissions)

Behavioral goals (contingency approach)

(communicate progress clearly to others in my work group) (listen to others during meetings without interrupting)

reason that feedback about performance is important

(it helps boost performance) (it increases the likelihood that employees will recommend their employer to others) employees know what they need to improve

Primary functions of performance management

(making employee related decisions such as pay raises) (clarifying expectations for advancement) (guiding employee training and development )

conditions that make pay for performance effective

(paying top performers a lot higher than other employees) (calibrated performance measures that ensure accuracy) (using multiple measures of performance)

4 steps in goal-setting process `

(set goal) (Promote goal commitment) (Provide support and feedback) (Create action plans)

effective coaching

(specific performance goals ) (being developmental)

fundamental characteristics

(specific time limits) (focusing on results) (being specific about what will be achieved)

commitment to goals can be promoted

(writing them down) (breaking them down into smaller steps or intermediate goals)

quantity (Measurements)

10 more customers were served

results of effective performance mangament

40% higher employee commitment ) (10-30% higher customer satisfaction) (50% less turnover)

franklin covey published in psychology Today in 2010

56% do not understand their organization goals

Performance management

A process that defines expectations, evaluates performance against the expectations, and consequences

Pay for Performance

Monetary incentives that link a portion of pay directly to results of accomplishments

Reasonable goals (perception of feedback)

Nobody has ever reached the goal and received the bonus

Fairness of the system (perception of feedback)

Only family member receive pay raises

important for managers to know the types of rewards their employees prefer in order

Provide rewards that will motivate employees

credibility of the source (perception of feedback)

Trust the person delivering the feedback to the honest

coaching

a customized process between two or more people with the intention of enhancing learning and motivating change

timeliness (Measurements)

calls were answered withing 24 hours

Evaluating Performance

comparing actual outcomes to a previously established goal is the step in the performance management process

financial (Measurements)

cost waste was reduced by 10%

Total Rewards

encompass not only compensation and benefits, but also personal and professional growth opportunities and a motivating work environment that includes recognition, job design, and work-life balance

project goals (contingency approach)

finish the productivity reports for the end of the year group summary

instructional and motivational

functions of feedback for those who receive

SMART goals

goals that are specific, attainable, time bound, and measurable

objective goals (contingency approach)

increase sales by 10%

involving employees in the design, selection, and assessment of reward system

increases their effectiveness as motivators

reward system

key components such as types of rewards, distribution criteria, and desired outcome are part of an organization

Accuracy (perception of feedback)

measure the right things correctly

distribution criteria

profits, error rates, and sales revenue

360 degree feedback is useful because

provides performance evaluation from peers, subordinates, and managers

managers can support employees goal achievement

providing timely and task specific feedback providing needed training

extrinsic rewards

rewards given to a person by the boss, the company, or some other person

intrinsic rewards

satisfaction a person receives from performing the particular task itself

3 common sources of feedback

self, others, task

effective feedback

serves a separate function form evaluation

noncash motivators

since the Great Recession , there has been trend toward

quality (Measurements)

there were no defective product returned

provide clear guidance how to improve performance

when giving both positive and negative feedback