Performance Management
Identify the major determinants of individual performance.
Discuss the three general purposes of performance management.
Identify the five criteria for effective performance-management systems.
Discuss the four approaches to performance management, the specific techniques used in each approach, and the way these approaches compare with the criteria for effective performance-management systems.
Chapter
8
Performance Management
Choose the most effective approach to performance measurement for a given situation.
Discuss the advantages and disadvantages of the different sources of performance information.
Choose the most effective source(s) for performance information for any situation.
Distinguish types of rating errors and explain how to minimize each in a performance evaluation.
Chapter
8
Performance Management
Identify the characteristics of a performance measurement system that follows legal guidelines.
Conduct an effective performance feedback session.
Chapter
8
Introduction
Performance management is the process through which managers ensure that employee activities and outputs are congruent with the organization's goals.
Performance Appraisal is the process through which an organization gets information on how well an employee is doing his or her job.
Performance Feedback is the process of providing employees information regarding their performance effectiveness.
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An Organizational Model of Performance Management
Individual
Behaviors
Situational
Constraints
Culture and
economic
conditions
Individual
Attributes
(skills, abilities)
Organizational
Strategy
Long and short
term goals
and values
Objective
Results
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Purposes of Performance Management
Strategic
Developmental
Administrative
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Performance Measures Criteria
Five performance criteria stand out:
Strategic congruence
Validity
Reliability
Acceptability
Specificity
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The Comparative Approach
Ranking
Simple ranking ranks from highest to lowest performer.
Alternation ranking - crossing off best and worst employees.
Forced distribution
Employees are ranked in groups.
Paired comparison
Managers compare every employee with every other employee in the work group.
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The Attribute Approach
Graphic rating scales
A list of traits is evaluated by a five-point rating scale.
Legally questionable.
Mixed-standard scales
Define relevant performance dimensions and then develop statements representing good, average, and poor performance along each dimension.
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Behavioral Approach
Critical incidents approach - requires managers to keep record of specific examples of effective and ineffective performance.
Behaviorally anchored rating scales (BARS)
Behavioral observation scales (BOS)
Organizational behavior modification - a formal system of behavioral feedback and reinforcement.
Assessment centers - multiple raters evaluate employees’ performance on a number of exercises.
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Results Approach
Management by objectives
top management passes down company’s strategic goals to next layer of management, and these managers define the goals they must achieve.
Productivity Measurement and Evaluation System (ProMES)
goal is to motivate employees to higher levels of productivity.
Goals
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Hierarchy
Quality Approach
A performance management system designed with a strong quality orientation can be expected to:
Emphasize an assessment of both person and system factors in the measurement system.
Emphasize that managers and employees work together to solve performance problems.
Involve both internal and external customers in setting standards and measuring performance.
Use multiple sources to evaluate person and system factors.
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Quality Approach (cont.)
Statistical process quality control techniques used:
Process-flow analysis
Cause-and-effect diagrams
Pareto chart
Control chart
Histogram
Scattergram
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Sources for Performance Information
Customers
Peers
Self
Subordinates
Supervisors
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Rater Errors in Performance Measurement
Similar to me
Contrast
Distributional errors
Halo and horns
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Reducing Errors and Appraisal Politics
Two Approaches to reducing rater error:
Rater error training
Rater accuracy training
Appraisal politics - a situation in which evaluators purposefully distort ratings to achieve personal or company goals.
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Improving Performance Feedback
Feedback should be given every day, not once a year.
Create the Right Context for Discussion.
Ask employees to rate their performance before the session.
Encourage the subordinate to participate in the session.
Recognize effective performance through praise.
Focus on solving problems.
Focus feedback on behavior or results, not on the person.
Minimize criticism.
Agree to specific goals and set a date to review progress.
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Managing Performance of Marginal Performers
Solid performers
High ability and motivation; managers should provide development opportunities
Misdirected effort
Lack of ability but high motivation; managers should focus on training
Underutilizers
High ability but lack motivation; managers should focus on interpersonal abilities
Deadwood
Low ability and motivation; managerial action, outplacement, demotion, firing.
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Following Legal Guidelines
Conduct a valid job analysis related to performance.
Base system on specific behaviors or results.
Train raters to use system correctly.
Review performance ratings and allow for employee appeal.
Provide guidance/support for poor performers.
Use multiple raters.
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