1. Organizational
Behavior, 9/E
Schermerhorn, Hunt, and
Osborn
Prepared by
Michael K. McCuddy
Valparaiso University
John Wiley & Sons, Inc.

2. Chapter 8 Study Questions
 What is goal setting?
 What is performance appraisal?
 What are compensation and rewards?
 What are human resource
development and person-job fit?
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3. Study Question 1: What is goal setting?
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4. Study Question 1: What is goal setting?
 Goal setting guidelines.
– Difficult goals are more likely to lead to
higher performance than are less difficult
ones.
– Specific goals are more likely to lead to higher
performance than are no goals or vague or
general ones.
– Task feedback, or knowledge of results, is
likely to motivate people toward higher
performance by encouraging the setting of
higher performance goals.
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5. Study Question 1: What is goal setting?
 Goal setting guidelines (cont.).
– Goals are most likely to lead to higher
performance when the people have the
abilities and the feeling of self-efficacy
required to accomplish them.
– Goals are most likely to motivate people
toward higher performance when they are
accepted and there is commitment to them.
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6. Study Question 1: What is goal setting?
 Goal setting and MBO.
– Management by objectives (MBO) is a process
of joint goal setting between a supervisor and
a subordinate.
– MBO is consistent with the goal setting
guidelines derived from the Locke and Latham
model.
– MBO establishes performance goals consistent
with higher level work unit and organizational
objectives.
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7. Study Question 1: What is goal setting?
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8. Study Question 1: What is goal setting?
 Potential problems with MBO.
– Too much paperwork. in documenting goals and
accomplishments.
– Too much emphasis on:
• Goal-oriented rewards and punishments.
• Top-down goals.
• Goals that are easily stated in objective terms.
• Individual goals instead of group goals.
– MBO may need to be implemented organization-wide.
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9. Study Question 2: What is performance
appraisal?
 Performance appraisal.
– Helps both the manager and subordinate
maintain the organization-job-employee
characteristics match
– The process of systematically evaluating
performance and providing feedback upon
which performance adjustments can be made.
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10. Study Question 2: What is performance
appraisal?
 Functions of performance appraisal.
– Define the specific job criteria against which
performance will be measured.
– Measure past job performance accurately.
– Justify rewards, thereby differentiating
between high and low performance.
– Define ratee’s needed development
experiences.
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11. Study Question 2: What is performance
appraisal?
 Two general purposes of good
performance appraisal.
– Evaluation.
• Concerned with such issues as promotions,
transfers, terminations, and salary increases.
– Feedback and development.
• Let workers know their status relative to firm’s
expectations and performance objectives.
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12. Study Question 2: What is performance
appraisal?
 Who does the performance appraisal?
– Traditionally done by ratee’s immediate
superior.
– People other than immediate superior may
have better information on certain aspects of
ratee’s performance.
– 360-degree evaluation provides appraisal
information from multiple perspectives.
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13. Study Question 2: What is performance
appraisal?
 Performance appraisal dimensions and
standards.
– Output measures.
• Quantity of work output.
• Quality of work output.
– Activity measures.
• Behavioral measures that are typically obtained
from the evaluator’s observation and rating.
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14. Study Question 2: What is performance
appraisal?
 Comparative methods of performance
appraisal.
– Ranking.
• Raters rank order people from best to worst.
– Paired comparisons.
• Raters compare each person with every other
person.
– Forced distribution.
• Raters place a specific proportion of employees
into each performance category.
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15. Study Question 2: What is performance
appraisal?
 Absolute methods of performance appraisal.
– Graphic rating scales.
• Raters assign scores on a list of dimensions related
to high performance outcomes in a given job.
– Critical incident diary records.
• Rater records incidents of unusual success or
failure in a given performance aspect.
– Behaviorally anchored rating scales (BARS).
• Rater identifies observable job behaviors.
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16. Study Question 2: What is performance
appraisal?
 Absolute methods of performance appraisal
(cont.).
– Behavioral observation scale (BOS).
• Rater rates each observable job behavior on a five-
point frequency scale.
– Management by objectives.
• Jointly established goals used as standards against
which the subordinate’s performance is evaluated.
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17. Study Question 2: What is performance
appraisal?
 To be meaningful, an appraisal system must be:
– Reliable — provide consistent results across time.
– Valid — actually measure people on relevant job
content.
 Measurement errors can threaten the reliability or
validity of performance appraisals.
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18. Study Question 2: What is performance
appraisal?
 Measurement errors in performance appraisal.
– Halo errors.
• Raters evaluate on several different dimensions
and give a similar rating for each dimension.
– Leniency errors.
• Raters tend to give everyone relatively high
ratings.
– Strictness errors.
• Raters tend to give everyone relatively low ratings.
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19. Study Question 2: What is performance
appraisal?
 Measurement errors in performance appraisal
(cont.).
– Central tendency errors.
• Raters lump everyone together around the average
or middle.
– Low differentiation errors.
• Raters restrict themselves to a small part of the
rating scale.
• Examples include leniency, strictness, and central
tendency errors.
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20. Study Question 2: What is performance
appraisal?
 Measurement errors in performance appraisal
(cont.).
– Recency errors.
• Raters allow recent events to exercise undue
influence on ratings.
– Personal bias errors.
• Raters let personal biases, such as stereotypes,
unduly influence the ratings.
– Cultural bias errors.
• Raters allow cultural differences of employees to
influence the performance appraisal.
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21. Study Question 2: What is performance
appraisal?
 Ways to reduce rating errors in performance
appraisals.
– Training raters to understand the evaluation process
and recognize errors.
– Ensuring that raters observe ratees on an ongoing
basis.
– Not having the rater evaluate too many ratees.
– Ensuring the clarity and adequacy of performance
dimensions and standards.
– Avoiding terms that have different meanings for
different raters.
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22. Study Question 2: What is performance
appraisal?
 Guidelines for ensuring the legality of
performance appraisal systems.
– Base appraisal on job requirements as
reflected in performance standards.
– Ensure that employees clearly understand the
performance standards.
– Use clearly defined dimensions.
– Use behaviorally-based dimensions supported
by observable evidence.
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23. Study Question 2: What is performance
appraisal?
 Guidelines for ensuring the legality of
performance appraisal systems (cont.).
– Avoid abstract trait names.
– Ensure that scale anchors are brief and
logically consistent.
– Ensure that the system is valid and
psychometrically sound.
– Provide an appeal mechanism to handle
appraisal disagreements.
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24. Study Question 3: What are
compensation and rewards?
 Pay as an extrinsic reward.
– Pay can help organizations attract and retain
highly capable workers, and help satisfy and
motivate these workers.
– High levels of job performance must be
viewed as the path through which high pay
can be achieved.
– Merit pay bases an individual’s salary or wage
increase on the person’s performance.
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25. Study Question 3: What are
compensation and rewards?
 Pay as an extrinsic reward (cont.).
– Merit pay should be based on realistic and
accurate measures of individual work
performance.
– Some people argue that merit pay plans ignore
the high degree of task interdependence
among employees.
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26. Study Question 3: What are
compensation and rewards?
 Creative pay practices.
– Skill-based pay.
• Rewards people for acquiring and developing job-
relevant skills.
– Gain-sharing plans.
• Give workers an opportunity to share in
productivity gains through increased earnings.
– Profit-sharing plans.
• Reward employees based on the entire
organization’s performance
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27. Study Question 3: What are
compensation and rewards?
 Creative pay practices (cont.).
– Employee stock ownership plans (ESOPs).
• Give company stock to employees or allow them to
purchase it at a price below market value
– Lump-sum pay increases.
• Provide wage or salary increase in one or more
lump-sum payments.
– Flexible benefit plans.
• Allow workers to select benefits according to their
individual needs.
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28. Study Question 4: What are human
resource development and person-job fit?
 Human resource development (HRD) and
the person-job fit.
– HRD and the person-job fit are key
contributing activities in performance
management and rewards.
– Human resource strategic planning provides
the foundation for HRD and the person-job fit.
– Staffing, training, and career planning and
development are important functions in HRD
and achieving a person-job fit.
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29. Study Question 4: What are human
resource development and person-job fit?
 Job analysis.
– The process and procedures used to collect
and classify information about tasks the
organization needs to complete.
– Identifies the worker characteristics needed to
perform the job.
– Forms the basis for a job description and job
specifications.
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30. Study Question 4: What are human
resource development and person-job fit?
 Recruitment.
– The process of attracting the best qualified individuals
to apply for a given job.
– Typical recruitment steps.
• Advertisement of a position vacancy.
• Preliminary contact with potential job candidates.
• Preliminary screening to obtain a pool of candidates.
– Recruitment approaches are external or internal.
– Realistic job previews.
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31. Study Question 4: What are human
resource development and person-job fit?
 Selection.
– A series of steps from initial applicant
screening to final hiring of the new employee.
– Selection process.
• Completing application materials.
• Conducting an interview.
• Completing any necessary tests.
• Doing a background investigation.
• Deciding to hire or not to hire.
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32. Study Question 4: What are human
resource development and person-job fit?
 Socialization.
– Process that adapts employees to the
organization’s culture.
– Occurs during and after completion of the
staffing process.
– Phases of socialization.
• Anticipatory socialization.
• Encounter.
• Change and acquisition.
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33. Study Question 4: What are human
resource development and person-job fit?
 Training.
– A set of activities that provides the
opportunity to acquire and improve job-related
skills.
– Types of training.
• On-the-job training involves job instruction while
performing the job in the actual workplace.
• Off-the-job training commonly involves lectures,
videos, and simulations, and increasingly is done
through e-training.
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34. Study Question 4: What are human
resource development and person-job fit?
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35. Study Question 4: What are human
resource development and person-job fit?
 Adult life cycle and career stages.
– The different problems and prospects of the adult life
cycle affect people’s work and careers.
– Career stages reflect the different responsibilities and
achievements associated with people’s working lives.
– Life cycle and career stages.
• Entry and establishment or the provisional
adulthood stage.
• Advancement or the first adulthood stage.
• Maintenance, withdrawal, and retirement or the
second adulthood stage.
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36. COPYRIGHT
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programs or from the use of the information contained herein.
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