Psychology of Work II
Evolution of Sourcing (finding workers)
1700s: highly local 1800s: wider 1900s: newspaper, walk ins, referras, mailed resumes 2000s: online job board, analytics
Within high performing companies, what percentage of learning and business leaders say their learning function is effective in achieving organizational business goals? A. 35% B. 45% C. 55% D. 65%
55%
job characteristics model
Any job can be described along these 5 core dimensions Skill/Task Variety • The extent to which a job requires a number of different activities, skills, and talents Task Identity• The degree to which a job requires completion of a whole, identifiable piece of work - that is, doing a job from beginning to end with visible results Task Significance • The job's impact on the lives or work of other people, whether inside or outside the organization Autonomy• The degree of freedom, independence, and discretion in scheduling work and determining procedures that the job provides Task Feedback• The degree to which carrying out the activities required results in direct and clear information about the effectiveness of performance
Which of the following types of experiences do you think is most valuable for developing leadership capabilities? A. Formal Training B. Mentoring and Coaching C. Challenging Job Assignments
Challenging Job Assignments
Vitality Health's old system
Design: - 13 different rating levels (from A to E including pluses and minuses) - Absolute system (people rated independent of one another) - Performance ratings used to determine merit-based wage increases, no provision for bonuses or alternative forms of compensation
How to improve interviews
Develop questions based on a thorough job analysis Formalize and structure the interviewing and rating process Provide interviewer training
PQ: Which of the following sources yields the highest number of total applicants? A. Employee referral B. Indeed C. Campus recruiting D. LinkedIn
Indeed
Theoretical predictors of behavior
Personality Achievement Mindsets Knowledge, Skills, & Abilities Motivation Work Attitudes Emotions Leadership
Interviews - Unstructured vs. Structured
The most common assessment used in organizations can be used to assess almost any KSA but are often used to assess softer skills (interpersonal skills, leadership, adaptability) unstructured: Interviewers make judgments as to what questions to ask and how to evaluate responses -low validity, potential for adverse impact Structured: Interviewers ask the same questions of all applicants and responses are scored using a standardized key -high validity, low adverse impact
Which of the following has a more positive impact on the proportion of women and minorities in management: A. Mandatory diversity training B. Voluntary diversity training
Voluntary diversity training
80% rule
a selection rate for any race, sex, or ethnic group which is less than 4/5 (or 80%) of the rate for the group with the highest rate will generally be regarded as evidence of adverse impact
LEVEL ONE:EXTERNAL DRIVERS OF CHANGE (CAHRS Future of Work Model)
globalization -Creation of integrated global teams • Restructuring of global value chains • Reshoring • Multi-polarization of global economy Economic change: • Continuous economic growth • Growing levels of income inequality • Growing urban-rural divide • Hollowing out of middle-wage jobs Technology • Creates as many jobs as they displace • More creation of higher skilled jobs • More competition among lower skilled workers as a result of fewer positions • Brings job loss and skill obsolescence demographic trends • Competition in developing countries versus developed countries • US workforce growing older • Persistent gender inequality• Increased racial and ethnic diversity
Reliability vs Validity
reliability (consistency) and validity (accuracy)
Challenge demands vs Hindrance demands
Challenge demands are positively related to both engagement and burnout, so outcome will depend on the situation (challenge demands lead to engagement but at high levels it leads to burnout) Hindrance demands are positively related to burnout, and negatively related to engagement so hindrance demands cannot lead to good engagement, only burnout
PAY-FOR-PERFORMANCE Enterprise Plans (3)
Profit Sharing • EEs receive on time cash award based on firm profits Stock Options/Grants • EEs receives one time option to buy or grant of company stock. Often vests over time Employee Stock Ownership Plans (ESOPs) • EEs receive company stock in a retirement account. Limits on diversification. Penalties for early withdrawal.
What are the results of employee engagement?
-engagement positively related to both task performance and contextual performance -62% of engaged employees feel their work positively effects their health, whereas only 22% for disengaged employees -higher rate (4 times more) for disengaged employees to leave their job
What are the key elements that comprise total rewards?
2 main parts: Compensation, made up of pay and benefits - pay (Base pay, Merit/Cost of Living, Short-term incentives, Long-term incentives) -benefits(Retirement, insurance, Paid Time Off, Perquisites, Workplace Flexibility) Relational and Experiential rewards -(Culture, Mission & Purpose, Advancement, Recognition, Status, Security, Quality of Life)
How to reduce adverse impact
Recommended ■ Recruit more qualified minority candidates. ■ Include multiple assessments that assess a comprehensive array of skills, abilities, and traits/qualities that are related to both technical task performance and contextual job performance Not Recommended ■ Use assessments that have low validity. ■ Provide test orientation and preparation programs to candidates (have been shown to have no impact). ■ Identify and remove individual test items on which majority and minority candidates differ (have been shown to have no impact)
Which of the following antecedents has been found to exhibit the strongest relationship with employee turnover: A. Pay B. Promotion chances C. Relationship with leader D. Stress
Relationship with leader
Which of the following DEI metrics is most prevalent in executive incentive plans: A. Spending with diverse suppliers B. Hiring of diverse talent C. Representation of diverse talent at managerial level and above D. Completion of diversity training by employees
Representation of diverse talent at managerial level and above
PQ: Currently, what is the average wage disparity between CEOs and the typical worker in top US companies? A. 25:1 B. 135:1 C. 240:1 D. 670:1
670:1
PQ: According to the Bureau of Labor Statistics, how many people were hired in 2021 in the United States? A. 15 million B. 47 million C. 75 million D. 92 million
75 mill
Which recruitment sources are best (which sources have the highest percent of overall employees)?
Employee referals(55ish%) Recruiter sourced (15ish%) Indeed(12ish%) the rest are 5% or below
theories underlying total rewards
Equity Theory (driven by sense of fairness) Expectancy Theory(will perform if they expect a reward) Operant Conditioning(Reinforcement) (employs rewards or punishments for behavior) Goal Setting Theory (goals influence behavior) Self Determination Theory (three needs: autonomy, competence, and relatedness) Agency Theory
Equity
Fairness or justice without bias or favoritism, with adjustments made to rectify imbalances and ensure all individuals have access to the same opportunities. DIFFERENT FROM EQUALITY
categories of benefits
Legally Required Benefits • Social Security • Workers' Compensation • Unemployment Insurance Retirement and Savings Plans • Defined Benefit Plans • Defined Contribution Plans • Flexible and Health Savings Plans Medical and Other Insurance • Medical Insurance, Dental, and Vision • Whole Life and Term Insurance • Short- and Long-Term Disability Miscellaneous Benefits • Paid Time Off • Allowances • Dependent Care • Tuition Reimbursement • Student Loan Repayment
Which of the following industries has the highest voluntary turnover rate: A. Government B. Leisure and Hospitality C. Retail D. Manufacturing
Leisure and Hospitality
common rating errors and biases (3)
Leniency Error (most employees are very good) Central tendency error (most employees are just average) Severity error (most employees are bad)
Barber's Recruitment Model
Phase 1: generating candidates (attraction) phase 2: maintaining applicant status (retention) phase 3: encouraging acceptances (Hiring)
PAY-FOR-PERFORMANCE individual plans (3)
Piece Work/Piece Rate • EE receives a set payment for each unit produced Merit Bonus/Spot Bonus • EE receives one time cash award for past performance Merit pay • EE receives increase to base pay for past performance
key considerations in choosing among assessments (for job performance)
Validity: accuracy or appropriateness from drawing inferences or predicting from test scores cost: cost to develop/adminster adverse impact: disproportionate negative impact on a group candidate reactions: if candidates like the test
SG Cowen Case Summary
case about how a boutique IB company hires new employees, which is through a series of unstructured interviews
open vs closed recruitment processes
closed ■ Efficient ■ Faster ■ Fewer rejections ■ Bias, less diverse open ■ Fair/transparent ■ Larger pool ■ Hidden talent ■ Costly/time-intensive
SAS Institute
company with a lot of weird stuff (pool, pool table, basketball court, gold course, massage place, etc) to keep employees happy
Doubling the pace of learning will ________ (increase or decrease) the number of jobs at risk for automation
decrease or reduce;
by 2035, risk of automation in the workforce will ___________ (diminish or increase)
diminish; many people will lost jobs to automation, but after 2035, that risk will diminish drasticaly
3 ways to encourage learning and development
effective mentoring ▪ Provide mentoring and coaching to boost employee engagement challenging development plans ▪ Provide stretch assignments that align with employees' career development plans management and job skills training ▪ Ensure employees have access to both generic (e.g., management) and specific (e.g., job-related) skills training
PQ: Which of the following sources yields the highest number of total hires? A. Employee referral B. Indeed C. Campus recruiting D. LinkedIn
employee referral
Adverse treatment theory
employment discrimination theory (disparate treatment) Intentionally treat protected class members differently
Adverse impact theory
employment discrimination theory (disparate impact) Practices or policies that were thought to be unbiased result in a disproportionate negative impact on a certain group
Ways to measure employee engagement
exit surveys recruitment surveys mid-year pulse pulse points learning plans 360 feedback skip-levels and 1:1s annual pulse Recommendations 1. Align survey items with how engagement is defined within the organization. 2. Differentiate measures of engagement from measures of its causes and effects (antecedents and consequences)
PQ: Most errors in performance appraisals can be eliminated by providing training that describes the kind of errors managers tend to make and suggesting ways to avoid them.
false
PQ: Most managers give employees lower performance appraisals than they objectively deserve.
false
PQ: Surveys that directly ask employees how important pay is to them are likely to overestimate pay's true importance in actual decisions.
false
PQ: The most important determinant of how much training employees actually use on their jobs is how much they learned during training.
false
What is the key goal of assessment? (regarding talent acquisition)
for predicted performance to match up with actual performance(want to maximize true positives and true negatives) very difficult
PQ: Which of the following types of assessments generally has the most favorable candidate reactions? A. Personality tests B. Cognitive ability tests C. Biodata D. Interviews
interviews
Virtual training is as effective as traditional, in-person training. A. No Way B. It Depends C. Definitely
it depends
PQ: On average, applicants who answer job advertisements are likely to have higher turnover than those referred by other employees.
true
What are the different types of assessments?
types of assessments: initial -resumes -applications -Phone screens -Algorithms Formal -cognitive ability -personality tests -job knowledge -simulations -structured interviews Contingent -drug testing -medical exam -background checks
PQ: Which of the following types of assessments generally has the highest validity for predicting job performance? A. Personality tests B. Work samples C. Biodata D. Integrity tests
work samples
Situational Judgment Tests
• Candidates are presented with situations and need to select or rank order potential options for handling them • Assess practical intelligence, problem solving, decision making • Used mainly for professional jobs pros • Moderate to high validity • Favorable candidate reactions • Low to moderate adverse impact Limitations • High cost • Low generalizability • Maximal vs. typical performance
Assessment Centers
• Candidates complete a series of exercises that simulate actual situations, problems and tasks faced on the job • Typically focused on assessing higher-level managerial and supervisory competencies (e.g., leadership, decision making, practical judgment, interpersonal skills) • Used mainly for managerial and executive jobs pros • Moderate to high validity • Favorable candidate reactions • Low to moderate adverse impact Limitations • High cost • Low generalizability • Maximal vs. typical performance
Situational Exercises/Simulation
• Candidates engage in exercises that mirror part of the job • Can be used to assess job specific KSAs as well as general qualities and personality characteristics • Used mainly for managerial and professional jobs pros • Moderate to high validity • Favorable candidate reactions • Low to moderate adverse impact Limitations • High cost • Low generalizability • Maximal vs. typical performance
Work Samples
• Candidates perform a representative sample of job tasks • Assess job specific knowledge, skills, and abilities • Used mainly for technical jobs pros • Moderate to high validity • Favorable candidate reactions • Low to moderate adverse impact Limitations • High cost • Low generalizability • Maximal vs. typical performance
What are the decisions about total rewards that need to be made to achieve these objectives?
■ Degree of dispersion? (ex: wage gap between CEO and average employee) - Across levels - Across departments - Across individuals within departments and levels ■ Measurement (tenure, skills, outcomes, etc.)? ■ Basis for allocating rewards (individual, group, enterprise)? ■ Use of incentive pay or pay-at-risk? ■ How much emphasis to place on pay? ■ What's included in the total rewards package (compensation, benefits, promotion, ownership, etc.)?
What are the goals of recruitment?
■ Influence the number of people who apply ■ Influence the type of people who apply - Enhance the quality of applicants (KSAs, person-organization fit) - Reduce the number of unqualified applicants ■ Ensure that those who apply reflect the diversity of the population
Big 5 personality test and benefits and limitations of using it during selection
■ Openness - imagination, curiosity ■ Conscientiousness - dependability and achievement orientation ■ Extraversion - sociability ■ Agreeableness - courtesy, tolerance ■ Neuroticism - emotional stability & control Benefits • Low cost • Low adverse impact • Offer incremental validity when used in combination with ability measures Limitations • Low to moderate validity • Less favorable candidate reactions • Faking?
Integrity Tests
■ Punitive Attitudes ■ Admissions of illegal drug use ■ Reliability/Diligence ■ Theft admissions Benefits • Low cost • Low adverse impact • Offer incremental validity when used in combination with ability measures Limitations • Low to moderate validity • Less favorable candidate reactions • Faking?
Key Elements of Talent aquisition
■ Recruitment ■ Assessment ■ Selection
AVERAGE COST OF AMERICAN LABOR PER HOUR WORKED?
$38.91 $11.47 Benefits (29.5%) $27.44 Salary and Wages (70.5%)
Measures of traits and qualities
- Personality inventories: Big 5 personality test - integrity tests: overt measures OR personality based measures (Mainly assess conscientiousness, also agreeableness and emotional stability)
dispositional characteristics linked to engagement
conscientiousness positive affect proactive personality
6 elements of organizational structure
1. departmentalization - division of labor (production, sales, finance, etc) 2. specialization - how work is broken down into smaller tasks (assembly line work = highly specialized) 3. chain of command - organization's reporting structure (heirachy) 4. centralization - how decisions are carried out in an organization 5. span of control - number of subordinates a manager is responsible for supervising -flat org = Large span of control (few levels) -tall org = Small spans of control (many levels) 6. formalization - extent to which there are clear rules, procedures, and policies
PQ: Based on the results of numerous surveys, what percentage of employees are thought to be highly engaged? A. 10-20% B. 25-35% C. 40-50% D. 55-65%
10-20%
What are the goals of performance management?
3 goals of performance management: SAD Strategic • Communicating organizational goals and ensuring employees' goals and actions are aligned Administrative • Gathering information needed to make and document decisions related to selection, compensation, promotion, termination, etc... Developmental • Providing feedback on strengths and weaknesses accompanied by coaching and training
How do we use information from multiple assessments to make selection decisions?
3 ways to do it: Multiple Regression • Applicants complete all assessments and their scores are weighted and added together to create an overall evaluation that is used to rank candidates. • Compensatory approach - a high score on one assessment can compensate for a low score on another assessment. Multiple Cutoffs • Applicants complete all assessments and must score above a set level on each assessment. Applicants who pass all of the assessments are then rank ordered based on their scores. • Non-compensatory approach - a high score on one assessment cannot compensate for a low score on another assessment. Multiple Hurdle • Similar to multiple cutoff strategy, but assessments are completed sequentially. Applicants must score above a set level on each assessment to continue in the selection process. • Non-compensatory approach
According to various estimates, how much of what trainees learn is commonly transferred back to the job? A. 30% B. 45% C. 60% D. 75%
30%
PQ: What percentage of employees believe their performance reviews help to improve their performance? A. 20% B. 30% C. 50% D. 75%
30%
high potential employees:
33% or 1 in 3 feel disengaged and dont put fill effort in their job 40% say they need to leave their organizatioon to advance their career
PQ: What percentage of HR executives believe their performance management process is an effective use of time? A. 25% B. 40% C. 55% D. 65%
40%
Top grading
A version of the forced distribution in which the bottom 10% is dismissed each year. Sometimes referred to "rank and yank."
What are the main objectives of total rewards?
AMARR Align Individuals with Organizational Goals Motivate and Reward Performance Attract Talent Retain the Best Employees Reinforce or Modify Organizational Culture example of misalignment: rewarding individual performance while hoping for teamwork OR rewarding shortterm sales and earning while hoping for long-term growth and profit
What are the key factors that influence recruitment outcomes?
Brand -familiarity: top of mind, recall, recognition, unaware. ("do I know this company?") -image: employer, job, people("what's it like at this company?") - reputation: public, peers, Family and friends ("what do other people think about this company?") Recruiters Timing Messaging -RJP (realistic Job Preview) = providing candidates with pros and cons of job and org. good for reducing turnover, improving job satisfaction Market
LEVEL TWO: CHANGES AT THE ORGANIZATIONAL LEVEL (CAHRS Future of Work Model)
Changing social construct: - gig work, diversity and inclusion(female talent underutlized, diversity becoming more important) , rewards and benefits(rewards programs falling behind, shift from tangible to intangible rewards) Implications of technology on work and workers: - autonomation(shifting away from routine, more about problem solving), reskilling (the need for reskilling >hiring for skills), rethinking capability (shift towards cognitive skills) redesigning tmrw's org: - talent mobility, flexible work (strong case for flexibility for better retention and productivity), workplace redesign (less or need for formal physical workplace)
What legal issues should be considered in recruitment and selection?
Civil Rights Act (1964) Title VII race, color, sex, religion, national origin Age Discrimination in Employment Act (ADEA; 1967) covers those 40+ Americans With Disabilities Act (ADA; 1990) make reasonable accommodation without undue hardship Civil Rights Act (1991) allows jury trials, compensatory damages
Typical performance management process:
DERP 1. Define performance - set performance goals, establish + communicate performance expectations 2. Evaluate performance - monitor, communicate performance strengths + weaknesses 3. Review Performance - deliver feedback to employees, coach employees 4. Provide performance consequences - provide consequences
What are some of the key challenges that may limit the effectiveness of the performance management process? (5)
DINCE ■ Doesn't assess actual performance - Managers focus on person characteristics (traits, knowledge, behaviors) rather than actual output ■ Infrequent feedback - Most appraisals are done annually; employees need more regular feedback and coaching ■ Non-data-based assessment - Evaluations commonly based on memory and subjective criteria ■ Conflicting objectives - By serving multiple purposes, often do not serve any extremely well ■ Errors are common - Judgments commonly biased by halo, recency, similar-to-me, leniency, and other errors
Trends in employee engagement (percent of disengaged, neutral, and engaged)
High disengaged: 10-20% Neutral: 40-70% Highly engaged: 10-20%
how do we evaluate different recruiting souces?
How does a given source fare in terms of... ■ Speed ■ Cost ■ Volume ■ Quality and/or "fit" ■ Employee retention ■ Diversifying applicant pool ■ Match with job level
what are the different recruitment sources? (internal and external)
Internal (Build) ■ Internal job postings ■ Employee referrals ■ Leadership development programs ■ Talent inventories ■ Succession plans External (Buy) ■ Campus recruitment ■ Advertisements ■ Careers web pages ■ Job boards ■ Social media ■ Temp agencies ■ Search firms ■ Professional associations
What are the antecedents of employee engagement? (what causes job engagement?)
Job Characteristics Leadership Learning and Development Opportunities Dispositional Characteristics
Motivating Potential Score (MPS) (related to Job Characteristic model)
Job characteristics influence 3 important psychological states: 1. experienced meaningfulness 2. responsibility 3. Knowledge of results these lead to the MPS, and the higher the MPS, the more motivated a worker is on average
CAHRS Future of Work Model
Level 1: external drivers - global - economic - demographic - technological change Level 2: organizational level - changing social contract - implications of technology - redesigning tmrw's org level 3: HR Implications
Letters of Recommendation
Most commonly used, least valid
LEVEL THREE: REDESIGNING TOMORROW'S ORGANIZATION (CAHRS Future of Work Model)
TALENT MOBILITY -Individuals value boundaryless careers (diverse experience, better compensation) -Firms will benefit from expanded skillsets and cross-functional social connections FLEXIBLE WORK -There is a strong business case for workplace flexibility (retention, productivity) -May alter the sense of community that stems from physical proximity WORKPLACE REDESIGN -There is a fissuring of formal, physical workplaces as comm technology improves -Different workplace models can effectively change the behavior of the workforce
What are some of the ways that we may improve the performance management process to enhance its effectiveness? (how to improve accuracy of performance ratings as they have negative impacts on women and minorities in management)
TPT Training: -provide rater training (rater error training: goal is to make raters aware of potential erros and teach them how to avoid them, generally INEFFECTIVE for improving accuracy)(FRAME OF REFERENCE TRAINING: goal is to provide raters with common, specific standards agaionst which to rate employees and the opportunity for calibration through practice, generally EFFECTIVE for improving accuracy) -coach managers on how to navigate the challenges of the performance management process (e.g. having difficult convos) (peer-led workships can be helpful for sharing best practices and advice) -train employees on how to write effective, objective self assessments Process -clearly define key performance indicators (KPIs) -gather additional information (crowd-sourced feedback, peer input) -simplify the process by minimizing number of forms and using tech to distrib and collect data Timing -increase frequency of evaluation, feedback, coaching (encourage regular feedback and coaching instead of annual point-in-time assessments) -decouple compensation decisions and developmental discussions (when performance appraisals are used for decision-making (pay or promotions), ratings tend to be more lenient and managers are less willing to give difficult feedback)
PQ: Which of the following job characteristics do you think most strongly relates to employee engagement? A. Autonomy B. Feedback C. Task Variety D. Task Significance
Task variance but task significance is the next strongly related, then autonomy and phsyical demands and stressful work conditions are negatively related to engagement
PAY-FOR-PERFORMANCE Group plans (2)
Team Incentive/Bonus Plan • Team members receive one time cash award based on team achieving certain goals. Gainsharing • EEs receive one time cash award based on increases in productivity and effectiveness of unit (e.g., plant)
What is employee engagement(and its related concepts and defining characteristics)?
The harnessing of organization members' selves to their work roles; in engagement, people employ and express themselves physically, cognitively, and emotionally during role performances Related concepts: flow, absorption, energy, involvement, satisfaction, commitment Defining characteristics of engagement: -Psychological connection with the performance of work tasks rather than an attitude toward features of the organization or job - Self-investment of personal resources (physical, emotional, and cognitive energies) in work
Recruitment
The process by which individuals are solicited to apply for jobs.
Quiet Quitting
Those who will show up to work and do the minimum required but not much else. Taking a step back from extra work, committees and socialization with coworkers.
leadership styles linked to engagement
Transformational leadership and leader-member Exchange
cognitive ability tests
assess gma (general mental ability) -pros: high validity, high generalizability, low cost -cons: mixed candidate reactions (somewhat favorable), high adverse impact
forced distribution and its problems
assigns a certain percentage of employees to each category in a set of categories Relative system (employees are not absolute/independent of each other) ▪ Cultural implications -Forced distribution systems can hurt employee morale and create a competitive culture that limits collaboration -For this reason, companies have abandoned forced rankings ▪ Limited utility over time -A simulation study by Scullen, Bergey, and Smith (2005) found that removing 10% of the lowest performing employees per year led to a 16% average workforce performance improvement in the first two years, but fell quickly to 2% in year 6 and 1% in year 10. ▪ Legal risks -Ford, Capital One, and other companies have lost class-action suits claiming that a disproportionate number of employees of particular sex, age, and race groups had been "ranked and yanked"
EMPLOYER DEFENSES
business necessity/job relatedness show that the process/practices: (a) are closely related to job requirements, and/or (b) predict job performance BFOQ (bona fide occupational qualification) necessary for safe performance or is essential to role; often difficult to prove Ex: need to be christian to work in church
Research has found a __________(positive or negative) relationship between employee engagement and shareholder return, safety, productivity, growth, customer loyalty, etc....
positive
recruitment vs selection
recruitment is attracting people to actually apply for ur company. you may start small and slowly gather people selection is the opposite: once you have those applicants, it is the process of cutting down, so you start with many people and finish with only a small group
total rewards continuum
scale, with CASH or direct compensation on the left and EXPERIENCE on the right
Providing evidence for adverse impact:
stock statistics: compare "utilization rates" e.g., compare company's % male/female in clerical vs. % m/f in "relevant population" flow statistics: compare "selection rates" e.g., compare % of male/female applicants hired use 4/5ths (80%) rule or other statistics concentration statistics: compare job category distributions e.g., compare % of male/female in clerical vs. sales vs. management
