Performance Management
the paired comparison method requires managers to
Compare every employee with every other employee in the work group, giving an employee a score of 1 overtime her or she is considered the high performer, this method tends to be time consuming
Behaviorally Anchored Rating Scales (BARS)
Designed to specifically define performance dimensions by developing behavioral anchors associated with different levels of performance. The managers task is to consider an employee's performance fits using the behavioral anchors as guide.
Behavioral Observation Scales (B.O.S)
Developed from critical incidents, this differs from BARS in 2 ways, first rather than discarding a large number of behaviors that exemplify effective or ineffective performance, BOS uses many of them to define all behaviors that are necessary for effective performance. second, this requires manager to rate the frequency with which the employee has exhibited during the rating period.
A contaminiated measure
Evaluates irrelevant aspects of performance or aspects that are not job related. The performance measure should seek to minimize contamination, but its complete elimination is seldom possible
companies like coco-cola, HP, and Fed Ex have introduced measures such as critical success factors, CFS are
Factors in a companies business strategy that give it a competitive edge
the use of forced distribution method is seen as a way for companies to
Increase performance, motivate employees, and open the door for new talent to join the company to replace the poor performers
step four in performance management
Involves performance evaluation, that is when the manager and employee discuss and compare the targeted performance goal and supporting behaviors with the actual results
step three in performance management
Involves providing employees with training, necessary resources and tools, and frequent feedback communication between the employee and manager focusing on accomplishments as well as issues and challenges
second step in performance management
Involves understanding the process or how to achieve the goals established in the first step, includes identifying measurable goals, behaviors, and activities that will help the employee achieve the results
strategic congruence
Is the extent to which a performance management system elicits job performance that is consistent with the organization's strategy, goals, and culture
A performance measure is deficient if
It does not measure all aspects of performance
For performance to be valid it must be
It must not be deficient or contaminated
drawback of B.O.S
May require more information than most managers can process or remember
one challenge that companies face are
Measuring customer loyalty, employee satisfaction and other nonfinacial performance measures that affect profitability
There are three categories of perceived fairness
Procedural, Interpersonal, and Outcome
step six in performance management
Provide consequences to performance results for achieving or failing to achieve
Reliability
Refers to the consistency of a performance measure; the degree to which a performance measure is free from random error
first step in performance management
Starts with understanding and identifying important performance outcomes or results, these outcomes or results benefit customers, employees, and peers.
Interrater reliability is:
The consistency among the individuals who evaluate the employees performance
Validity
The extent to which a performance measure assesses all the relevant- and only the relevant aspects of job performance
Specificity
The extent to which a performance measure gives detailed guidance to employees about what is expected of them and how they can meet these expectations
Acceptability
The extent to which a performance measure is deemed to be satisfactory or adequate by those who use it
A performance has interrater reliability if:
Two individuals give the same (or close to the same) evaluations of a persons job performance
performance appraisal is
an administrative duty performed by managers and was primarily the responsibility of the hr function
behavioral approach
attempts to define the behaviors an employee must exhibit to be effective in the job, the various techniques define those behaviors and requires managers to assess the extent to which employees exhibit them
evaluating the attribute approach
attribute based performance methods are the most popular methods in organizations, easy to develop and are generalizable across a variety of jobs strategies, and organizations. attributes relevant to job performance and carefully define them on the rating instrument can be as reliable and valid
when confrontations arise during the developmental purpose managers tend to
believe this strains everyday working relationships, thus giving high ratings to all employees enables a manager to minimize conflicts but this purpose is then not fully achieved
how to make formal evaluation effective
by engaging in frequent performance conversations with employees rather than wait for the formal annual review
BARS advantage
can increase interrater reliability by providing a precise and complete definition of the performance dimension
4 types of approaches
comparative, attribute, results, and quality
alternation ranking
consists of a manager looking at a list of employees, deciding who is the best employee, and crossing that person's name off the list
What are the steps in Performance Management Process?
define performance outcomes for company,division, and department, develop employee goals behavior, and actions to achieve outcomes, provide support and on going performance discussions, evaluate performance, identify improvements, and provide consequences to results
customer perspective
defines value for customers (service, quality)
mix standard scales
developed to get around some of the problems with the graphic ratings scale, to create a mixed scale we define relevant performance dimensions and develop statements (good, average, poor performance along with each dimension).
ProMES consist of 4 steps
first, people in an organization identify the products, or set of activities or objectives the organization sets to accomplish, second, the staff defines indicators of the products, third, the staff establishes contingencies between the amount of indicators and the level of evaluation associated with that amount, fourth, a feedback system is developed that provides employees and work groups with info about their specific level of performance on each of the indicators
financial perspective
focuses on creating sustainable growth in shareholder value
the results approach
focuses on managing the objective, measurable results of a job or work group. this approach assumes that subjectivity can be eliminated from the measurement process and that results are a close indicator of one's contribution of organizational effectiveness.
internal or operations perspective
focuses on processes that influence customer satisfaction
learning growth perspective
focuses on the company's capacity to innovate and continuously improve
properly conducted appraisals
help identify the strongest and weakest employees
competency model
identify and provides descriptions of competencies that are common for an entire occupation, organization, job, family, or a specific job
balanced scorecard
includes four perspectives of performance including financial, customer, internal, or operations and learning and growth.
evaluation of the behavioral approach
it can link the company's strategy to the specific behavior necessary for implementing this strategy, it provides specific guidance and feedback for employees about the performance expected of them
the use of technology such as web benefits
it can reduce the administrative burden of performance appraisal and improve the accuracy of performance reviews
administrative purpose
organizations use Pm in many admin decisions, salary administration (pay raise), promotions, retention-determination, layoffs and recognition of the individual
three techniques that fall under the comparative approach
ranking, forced distribution, and paired comparission
simple ranking
requires managers to rank employees within their departments from highest to poorest performer
comparative approach
requires the rater to compare an individual performance with that of others, this approach usually uses some overall assessment of an individuals performance or worth and seeks to develop some ranking of the individuals within a work group.
Competencies
set of skills, knowledge, abilities, and personal characteristics that enable employees to successfully perform their jobs
strategic purpose
should link activities with the organizations goals, strategies are implemented through defining results, behaviors and to some other extent employee characteristics that are necessary for carrying out that strategy
SMART goals
specific, measurable, attainable, relevant, timely
performance measures criteria includes
strategic congruence, validity, reliability, acceptability, and specificity
the purpose of performance management (three kinds)
strategic, administrative, and developmental
step five in performance management
the Employee and manager identifying on what they can do to capitalize on strengths and weaknesses
performance management system identifies not only any deficient aspects of employees but
the cause of the deficiencies for example a skill or motivational problem that will hold the employee back
Productivity measurement and Evaluation System (promes)
the main goal of promes is to motivate employees to improve team or company-level productivity, its a mean of measuring and feeding back productivity information to employees.
graphic ratings scale
the most common form that the attribute approach to performance management takes, a list of traits are evaluated by a five point rating scale. (manager considers one employee at a time, circling the number that signifies how much of that trait the individual has.)
Validity is concerned with maximizing
the overlap between actual job performance and the measure of job performance
performance feedback
the process of providing employees information regarding their performance effectiveness (may also include rewards through compensation such as merit increases or bonuses).
perfomance appraisal
the process through which an organization gets information on how well an employee is doing on his or her job
perfomance management
the process through which managers ensure that employees activities and outputs are congruent with the organizations goals
BARS disadvantage
they can bias information recall that is, behavior that closely approximates the anchor is more easily recalled than the other behavior.
developmental purpose
third purpose of pm is to develop employees who are effective at their jobs, when employees are not performing well pm seeks to improve their performance
the attribute approach
this approach focuses on the extent to which individuals have certain attributes (characteristics or traits) believed to be desirable for the company's success. ie, initiative, leadership, and competitiveness
evaluating the comparative approach
this approach is an effective tool in differentiating employee performance; it virtually eliminates problems of leniency, central tendency, and strictness.
the use of objectives
this is popular in both private and public organizations, the top mgt defines the company's strategic goals for the coming year, these goals are passed on to the next layer of management and these mangers define the goals they must achieve for the company to reach it goals.
perfomance management system (PMS)
three parts: defining performance, measuring performance, and pervading back performance information
strengths of competency models
useful for a variety of HR practices including recruiting, selection, training, and development, competency models can be used to help identify the best employees to fill open positions and as the foundation for development plans that allow the employee and manager to target specific strengths and development areas.
forced distribution method
uses a ranking format, but employees are ranked in groups, this technique requires the manager to put certain percentages of employees into pre-determined categories
Effective perfomance evaluation systems measure
what gets accomplished (objectives) and how it gets accomplished (behaviors)