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MGT351_Chapter 9.pptx

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MGT351_Chapter 9.pptx

  1. 1. Performance Management & Appraisal Chapter 9 Presented by: FSZ
  2. 2. Learning Objectives  Define performance management and discuss how it differs from performance appraisal  Describe the appraisal process  Set effective performance appraisal standards  Develop, evaluate, and administer performance appraisal tools  Explain and illustrate the problems to avoid in appraising performance  Discuss the pros and cons of using different raters to appraise a person’s performance  Perform an effective appraisal interview 2
  3. 3. The Performance Appraisal Process  Performance appraisal means evaluating an employee’s current and/or past performance relative to his/her performance standards  supervisor set performance standards in case of effective appraisal; also requires that the employee receives the training, feedback, and incentives required to eliminate performance deficiencies  effective appraisals begin before the actual appraisal, with the supervisor defining the employee’s jobs and performance criteria  defining job means making sure that the supervisor and subordinate agree on the job duties, job standards, and appraisal method to be used 3
  4. 4. The Performance Appraisal Process  involves the 3-step performance appraisal process  (i)setting work standards  (ii)assessing the employee’s actual job performance relative to those standards  (iii)providing feedback to the employee with the aim of helping in order to eliminate performance deficiencies or continue to perform similarly 4
  5. 5. Why Appraise Performance?  make the decisions regarding pay, promotion, retention  play an important role in the performance management process  lets to plan for correcting any deficiencies and to reinforce the noteworthy performances  facilitates career planning while exhibiting strengths and weaknesses of the employees  identify the employees’ training and development needs 5
  6. 6. Defining Employee Goals & Performance Standards  performance appraisal should compare “what should be” with “what it is”  managers use one of these 3 bases to establish performance standards for employees: goals, job dimensions (team work/communication), competencies/behaviors (skills)  what extent the employee is attaining his/her numerical goals (derived from company goals)  ex: a companywide goal of reducing costs by 10% should translate into goals for how individual employees and/or teams will cut costs 6
  7. 7. Defining Employee Goals & Performance Standards  Effective goals are SMART  Specific- clearly state the desired results  Measurable-“how much?”  Attainable  Relevant- derived from company goals  Timely- reflect deadlines and milestones 7
  8. 8. Who Should do the Appraising?  Supervisor Appraisals - straight forward and makes sense - in best position to observe and evaluate the subordinates  Peer Appraisals - one supervisor and three to four peers for appraisal are chosen - immediate positive impact on improving perception of open communication, task motivation, social loafing, group viability, cohesion, & satisfaction - use of social media  8
  9. 9. Who Should do the Appraising?  Rating Committees - composed of the employee’s immediate supervisor and 3-4 other supervisors - help cancelling out problems, such as individual raters’ bias - include different facets of an employee’s performance by different appraisers  Self-Ratings - in conjunction with supervisor’s ratings - employees usually rate themselves higher than do their supervisors or peers 9
  10. 10. Who Should do the Appraising?  Subordinate Appraisals - used usually for developmental purpose rather than pay - subordinates prefer giving anonymous responses; otherwise the rating is inflated - evidence suggests that upward feedback can improve performance  360-Degree Feedback - collects performance information all around an employee- supervisors, subordinates, peers, internal and external customers - used usually for developmental purpose rather than pay 10
  11. 11. Traditional Tools for Appraising Performance  Graphic Rating Scale Method - the simplest and most popular method - lists traits or performance dimensions (communication/teamwork) and a range of performance values (from “unsatisfactory” to “outstanding”) - supervisor rates subordinate by checking the score that best describes the subordinate’s performance for each trait 11
  12. 12. Traditional Tools for Appraising Performance  Alternation Ranking Method - lists all subordinates to be rated - crosses out the names of any not well known enough to rank - indicates the employee who is the highest on the performance dimension being measured and the lowest one - then chooses the next highest and next lowest, and goes on till all have been ranked 12
  13. 13. Traditional Tools for Appraising Performance  Paired Comparison Method - makes the ranking method more precise - ranking employees by making a chart of all possible pairs of the employees for each trait and indicating which is the better employee of the pair 13
  14. 14. 14
  15. 15. Traditional Tools for Appraising Performance  Forced Distribution Method - similar to grading on a curve - predetermined percentages of ratees are placed into several categories - proportions in each category are not necessarily symmetrical - top 20%, middle 70%, bottom 10% - some call it “Rank & Yank” 15
  16. 16. Traditional Tools for Appraising Performance  Critical Incident Method - supervisor keeps a log of positive and negative examples of a subordinate’s work-related behavior - supervisor and subordinate meet to discuss the latter’s performance - provides good and poor performance examples - rating just not reflect the employee’s most recent performance - how the subordinate can eliminate deficiencies - not useful for comparing employees or for salary decisions as there is no numerical rating 16
  17. 17. Traditional Tools for Appraising Performance  Narrative Forms - supervisor assesses the employee’s past performance and required areas of improvement - narrative assessment helps the employee understand his/her performance 17
  18. 18. Traditional Tools for Appraising Performance  Behaviorally Anchored Rating Scales (BARS) - appraisal method that aims at combining the benefits of narrative critical incidents and quantified ratings by anchoring a quantified scale with specific narrative examples of good and poor performance 18
  19. 19. Traditional Tools for Appraising Performance  Management By Objectives (MBO) - multistep companywide goal-setting and appraisal program - required the manager to set specific, measurable, organizationally relevant goals with each employee, and then periodically discuss the latter’s progress toward these goals 19
  20. 20. Electronic Performance Monitoring (EPM) - use computer network technology to allow managers to monitor their employees’ computers - allows to monitor employees’ rate, accuracy, and time spent working online - can improve productivity, but can also backfire by increasing stress 20
  21. 21. Appraisal in Practice  the best appraisal forms merge several approaches 21
  22. 22. Potential Appraisal Errors  Unclear Standards - appraisal that is too open to interpretation - traits and degrees of merit are ambiguous  Halo Effect - the problem that occurs when a supervisor’s rating of a subordinate on one trait biases the rating of that person on other traits  Central tendency - rating almost all the employees average 22
  23. 23. Potential Appraisal Errors  Strictness or Leniency - supervisors tendency to rate all subordinates either low or high  Recency Effects - letting the recent performance blind the supervisor to what his/her performance has been over the year  Bias - tendency to allow personal differences to affect the appraisal ratings 23
  24. 24. Types of Appraisal Interview Situations  Satisfactory-Promotable: easiest interview; objective is to discuss employee’s career plans and to develop a specific professional developmental plan  Satisfactory-Not promotable: objective is to maintain satisfactory performance; need to find best incentives that are important to the employee (small bonus, extra time off, acknowledgement)  Unsatisfactory-correctable: objective is to lay out an action plan for correcting performance  Unsatisfactory-uncorrectable: the most difficult one; dismissal is often the usual option 24
  25. 25. Conducting Appraisal Interview  Talk in terms of objectives work data (absence, quality records, orders processed, productivity records)  Don’t get personal (you’re too slow)  Encourage the person to talk (open-ended questions)  Get agreement (getting to know what has been done in right or wrong way) 25
  26. 26. Criticizing a Subordinate  let the employee maintain his/her dignity  criticize in private and constructively  provide examples of critical incidents and specific suggestions of what to do and why  avoid once-a-year critical broadsides; rather give periodical feedback  never say the employee is always wrong  should be objective and bias-free 26
  27. 27. Handling Formal Written Warning  serves two purposes  may serve to shake employee out of his/her bad habits  may help to defend rating (to boss and court)  should identify the employee’s standards, making it clear that the employee was aware of the standard  also specify any deficiencies related to the standard, showing the employee had an opportunity to correct performance 27
  28. 28. Performance Management  Performance management is the process of identifying, measuring, and developing the performance of individuals and teams and aligning their performance with the organization’s goals 28
  29. 29. Basic Elements of Performance Management  Direction sharing – communicating the company’s goals throughout the company and then translating these into doable departmental, team, and individual goals  Goal alignment – having a method that enables managers and employees see the link between employees’ goals and those of their department and company  Ongoing performance monitoring – includes using computerized systems that measure and then email progress and exception reports based on the person’s progress toward meeting his/her performance goals 29
  30. 30. Basic Elements of Performance Management  Ongoing feedback – both face-to-face and computerized feedback regarding progress towards goals  Coaching and developmental support should be an integral part of the feedback process  Recognition and rewards provide the consequences needed to keep the employee’s goal-directed performance on track 30
  31. 31. 31 Thanks! Any questions? You can find me at faseeha.zabir@northsouth.edu
  32. 32. Reference Dessler, G. (2012). Human Resource Management (13th Edition). New York: Pearson. 32

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