HR Chapter 9: Performance Management
Developmental Purposes of Performance Management
AKA Develop Performance management is a tool to help employees improve their weaknesses and realize their longterm goals and career objectives Helps in identifying training needs and the employee potential and the course of actions to achieve it
Administrative Purposes of Performance Management
AKA Documentation Performance management is a tool for administrative decisions such as: compensation, promotions, lateral movements (transfers), demotions, retention/termination, layoffs and recognition This performance management result is utilized to discipline employees as well
Behavior Based Approaches
Absolute Approach Emphasizes examining the extent to which employees actually display certain behaviors on the job Some attributes reflect truly the employee performance Attributes usually predict the person's potential to perform well rather than his or her actual performance -Critical incident approach -Forced choice approach -Behaviorally Anchored Rating Scales -Behavior Observation Scales
Attribute Based Approach
Absolute Approach Method of evaluating employees based on various traits and attributes they posses relevant to their performance Designed to measure the extent to which an employee possesses certain attributes
Critical Incident Approach
Behavior Based Approach Behavior based evaluation approach where the evaluation criteria consists of statements or examples of exceptionally good or poor performance that employees display over the course of the evaluation period Focus on actual behaviors rather than traits Managers need to keep track of employee behaviors to be effective
Forced Choice Approach
Behavior Based Approach Managers must choose from a set of alternative statements regarding the person being rated Each statement has a predetermined value, based on the priorities of the organization
Behavior Observation Scales
Behavior Based Approach Requires raters to evaluate how often an employee displays certain behaviors on the job Main difference from BARS is that it details various behaviors for each performance dimension and assesses the frequency of each
Behaviorally Anchored Rating Scales
Behavior Based Approach BARS Raters must evaluate individuals along a number of performance dimensions with each performance rating standard anchored by a behavioral example Integrates the benefits of the critical incident approach and the graphic rating scales Provides raters with a frame of reference for evaluating each performance dimension, possibly achieving higher consistency
Counseling
Bringing a problem to an employee's attention before it becomes serious enough to require a written warning
Absolute Approaches
Evaluation of employees by comparing them against certain "absolute" standard (rather than against each one) along a number of performance dimensions Each employee's evaluation is independent of others in the workgroup, and might focus on the employee attributes, behaviors and/or results
Progressive Discipline
Process by which an employee with disciplinary problems progresses through a series of disciplinary stages until the problem is corrected Step 1 Verbal Warning: -Stating that behavior is not acceptable Step 2 Written Warning: -letter or form specifying problem history, employee's explanation, company expectations for change, & consequences if improvement is not met Step 3 Suspension without Pay: -Suspending employee with a final warning Step 4 Termination
Communication
Providing Feedback Conducting the performance appraisal meeting
Follow Through
Providing Feedback Following up on what is communicated in order to make sure the points are addressed
Preparation
Providing Feedback Gathering information from relevant sources, including the ones being assessed and their performance challenges and deficiencies
Similar to Me Error
Performance Measurement Error When managers rate more highly employees who resemble them in some way
Contaminated Performance Measures
Performance measure that is irrelevant to an individual's actual job performance
Primacy Error
Performance Measurement Error Rater's earlier impressions of an individual can bias the later evaluations of that person
Error of Central Tendency
Performance Measurement Error Rating everyone "average"
Understanding the Cause of Poor Performance
Developing Action Plans to Improve Performance Lacking certain competencies; knowledge skills & abilities Inadequate working environment that they cannot control Error in job design Inadequate Technology Lack of support from co workers Poor performance of co workers The problem might reside in the lack of effort of motivation
Taking Action
Developing Action Plans to Improve Performance Removing barriers to employee success Training and development activities to address skill deficiencies Coaching and mentoring Work design and technology solutions The qualification and performance of co workers Addressing quality of employee performance Review performance dimensions with employees Ensure performance measures are accurate Ensure manager's support
Performance Dimensions
Different areas that are being evaluated Should reflect the reasons the job exists Jobs consist of multiple performance dimensions, thus if you do not break their performance down, you will not be able to identify the areas to improve
Performance Management
Evaluating the performance of your employees against the standards set for them Helping them develop action plans to improve their performance Goal is to motivate employees to work hard and continually improve what they do
Validity
Extent to which you are measuring what you want to measure and how well that is done Your performance measures reflect the actual performance of your employees
Providing Feedback
Focus on behaviors or performance rather than on the individual in order to decrease defensiveness and focus on how to solve the performance issue Do not compare to others and be supportive Provide limited and focused information to avoid overwhelming the employee Balanced approach- positive and improvement areas Involve/engage employee in discussion in order to increase self reflection, signal improvement, discuss factors that might have influenced their performance
Positive Discipline
Focuses on constructive feedback and encourages employees to take responsibility for trying to improve their behaviors or performance at work
Steps in the Performance Management Process
Identifying Performance Dimensions Developing Performance Measures Evaluating Performance Providing Feedback Developing Action Plans to Improve Performance
Deficient Performance Measure
Incomplete appraisal of an individuals performance when important measures are not measured Only measure performance dimensions related to the job
Paired Comparison
Individual Comparison Evaluation approach in which each employee in a business unit is compared to every other employee in the unit
Ranking Approach
Individual Comparison Evaluation approach in which employees are evaluated from best to worst along some performance dimension or by virtue of their overall performance
Forced Distribution
Individual Comparison Form of individual comparisons whereby managers are forced to distribute employees into one of several predetermined categories Forces managers to be more critical in assessing employees
Performance Measure Standards
Levels of expected performance that relate to levels of task or job effectiveness How can you compare results if you do not have a standard or benchmark to compare results to?
Steps to reduce measurement errors
Make rating formats more specific Appraisal training to familiarize raters with errors that can occur Provide Frame of Reference Training to help raters understand performance standards and dimensions and develop common evaluation standards It is useful to communicate the frame of reference to employees as well
Leniency Error
Performance Measurement Error Constantly rating employees on the high end of the scale
Strictness Error
Performance Measurement Error Constantly rating employees on the low end of the scale
Contrast Effect
Performance Measurement Error Manager artificially inflates or deflates an employee's rating after comparing employee to another individual
Halo/Horn Error
Performance Measurement Error Overall positive or negative view of employees performance biases the ratings give on individual criteria
Recency Error
Performance Measurement Error Rater focuses on employee's performance near the time of the evaluation
Graphic Raters Scale
Raters use a 3 5 7 or 10 points scale to assess the attributes
Reliability
Refers to how well a measure yields consistent results over time or across raters
Direct Measures Approach
Results Based Approach Managers gauge outcomes of employees' work such as sales, productivity, absenteeism When the right measures are evaluated, it is very clear and meaningful Focusing only on certain outcomes might lead to neglecting other outcomes
Management by Objectives
Results Based Approach Managers meet with employees and jointly set goals for them to accomplish during particular time period At the end of the period, they meet again to evaluate whether the employee met or exceeded the objectives or whether they failed
Global Performance Measures
Single score to reflect an individual employees overall performance
Self Appraisals
Source of Performance Data Can be useful starting point and developmental tool to help employee improve performance Employees may tend to inflate their evaluations, especially if data is used for administrative purposes Limit its usage to developmental purposes
Customers
Source of Performance Data Good source of data because they are the critical determinant to a company's success Data might not be equally relevant for all jobs Might be expensive and time consuming to reach out to all customers Satisfaction levels may only report extremely good or bad experiences Try to ensure a representative sample
Co Workers
Source of Performance Data May be able to comment on cooperation and support, but may intentionally skew rating May have more realistic overview of the job Try to utilize this source for development purposes
Subordinates
Source of Performance Data May be hard to separate skill from likeability Fear from retaliation Managers might tend to prioritize the satisfaction of their employees over organizational goals
Supervisors
Source of Performance Data May not have time to monitor and observe employees everyday, or simply managers might not work in close proximity Limited observation capacity, thus does not necessarily represent the full picture of the employee's performance
Identifying Performance Dimensions
Step in the Performance Management Process Global Performance Measure Performance Dimensions Identify those dimensions to have a specific and effective performance system must be as specific as possible
Evaluating Employee Performance
Step in the Performance Management Process Individual Comparisons: -Ranking Approach -Paired Comparison -Forced Distribution Absolute Approaches: -attribute based approach -behavior based approach -Critical incident approach -forced choice approach -Behaviorally anchored rating scales -Behavior observation scales Results Based Approaches: -direct measures approach -management by objectives Sources of Performance Data: -supervisors -coworkers -self appraisals -subordinates -customers Performance Measurement Errors: -halo/horn error -contrast effect -primacy error -recency error -similar to me error -leniency error -strictness error -error of central tendency Steps to reduce measurement errors: -appraisal training -frame of reference training
Developing Performance Measures
Step in the Performance Management Process Performance measures should be reliable and valid Reliability Validity Deficient Performance Measure: Contaminated Performance Measures Always make sure to select measures that reflect the essential performance dimensions of the job and only those measures Performance Measure Standards Specificity
Performance Improvement Plan
Taking Action Tool to monitor and measure an employees deficient work products, processes and or behaviors to improve performance or modify behavior Should be constructive and clear in communicating -how the inadequate performance determination was made -what corrective or disciplinary actions will be taken -By whom and when -when and how the individual performance will be reviewed F: facts that define the problem O: objectives that help employee understand how to resolve problem S: solutions to help employee strategize how to reach objectives A: actions that will be taken if problem is not corrected +: plus overall efforts and support to help employee succeed
Specificity
The clarity of the performance standards
Weighting Performance Criteria
Weights are used to adjust the relative importance of different performance dimensions
