Chapter 10 dessler 12-ce_ppt_ch10

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Performance Management | 10-1

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Dessler, Chhinzer, ColeHuman Resources

Management in CanadaCanadian Twelfth Edition

Chapter 10: Performance Management

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Learning Outcomes

• EXPLAIN the five steps in the performance management process.

• DESCRIBE five performance appraisal methods and the pros and cons of each.

• DISCUSS the major problems inhibiting effective performance appraisals.

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Learning Outcomes

• DISCUSS 360-degree appraisal from multiple sources.

• DESCRIBE the three types of appraisal interviews.

• DISCUSS the future of performance management.

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Performance Management

The process encompassing all activities related to improving employee performance, productivity, and effectiveness.

• includes goal setting, pay for performance, training and development, career management, and disciplinary action

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Performance Management Process

Step 3: Conduct performance appraisal and evaluation discussions

Step 1: Define performance expectations

Step 2: Provide ongoing feedback and coaching

Step 4: Determine performance rewards/consequences

Step 5: Conduct development and career opportunity discussions

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Step 1: Defining Performance Expectations

Task performance

• direct contribution to job-related processes

Contextual performance

• indirect contribution to the organization’s social responsibility values

Legal considerations

• correlate performance expectations to job activities

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Step 2: Providing Ongoing Coaching and Feedback

• important to have open two-way communication

• employee responsible for monitoring own performance, and asking for help

• manager responsible for communicating changing strategies and objectives if applicable

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Performance Improvement Plan (PIP)

continued

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Performance Improvement Plan (PIP)

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Step 3: Performance Appraisal and Evaluation Discussion

Formal appraisal methods:

• graphic rating scale

• alternation ranking

• paired comparison

• forced distribution

• critical incident

• narrative forms

• behaviourally anchored rating scales (BARS)

• management by objectives (MBO)

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Graphic Rating Scale

• a scale that lists a number of traits and a range of performance for each

• the employee is given a rating that best describes the level of performance for each trait

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Graphic Rating Scale - Sample

Click icon to add picture

continued

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continued

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continued

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Alternation Ranking Method


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Paired Comparison Method

• for each trait, list all possible pairs of employees

• for each pair, indicate “+” for the higher ranked employee, “-” for the lower ranked

• rank employees by trait based on number of “+” scores

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Paired Comparison Sample


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Forced Distribution Method

• predetermined percentages of ratees are placed in various performance categories

• example:• 15 percent high performers• 20 percent high-average performers• 30 percent average performers• 20 percent low-average performers• 15 percent low performers

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Critical Incident Method

Keeping a record of uncommonly good or undesirable examples of an employee’s work-related behaviour and reviewing the list with the employee at predetermined times.

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Critical Incident Sample

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Narrative Forms

• free form report of performance

• may take form of performance improvement plan

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Behaviourally Anchored Rating Scales (BARS)

An appraisal method that aims to combine the benefits of narratives, critical incidents, and quantified ratings by anchoring a quantified scale with specific narrative examples of good and poor performance.

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Behaviourally Anchored Rating Scales Sample


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Behaviourally Anchored Rating Scales (BARS)

Advantages

• a more accurate measure

• clearer standards

• Assists in providing feedback

• independent dimensions

• Consistency

Disadvantage

• time-consuming

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Management by Objectives (MBO)

Step 3: Discuss departmental goals

Step 1: Set the organization’s goals

Step 6: Provide feedback

Step 2: Set departmental goals

Step 4: Define expected results (individual goals)

Step 5: Performance reviews: measure results

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Use of Technology in Performance Appraisals

• enables managers to automate record keeping and report writing

• provides overall performance management process

• provides employees with clear development path

• advanced reporting capabilities

• electronic performance monitoring (EPM)

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Performance Appraisal Problems

• validity and reliability

• rating scale problems

• unclear performance standards

• halo effect• central tendency

• leniency or strictness

• appraisal bias• recency effect• similar-to-me bias

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Example of Unclear Standards

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Advantages and Disadvantages of Appraisal Methods

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Who Should Do the Appraising?

• supervisors

• self

• peers

• committees

• subordinates

• 360-degree appraisal (all of the above)

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360-Degree Appraisal

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360-Degree Appraisal Advice

• have performance criteria developed by people familiar with the job

• be clear about who will have access to reports

• provide training for all participants

• ensure confidentiality

• evaluate 360-degree system for fine-tuning

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Formal Appraisal Discussions

• supervisor and employee:• review appraisal, and plan to remedy deficiencies

and reinforce strengths

• types of interviews:• satisfactory—promotable: development plans• satisfactory—not promotable: maintain performance• unsatisfactory—correctable: action plan to correct

performance

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How to Conduct the Interview

1. Be direct and specific• use objective work data

2. Do not get personal• compare against standard

3. Encourage the person to talk• use open-ended questions, listen

4. Develop an action plan• agree on future steps

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How to Handle Criticism and Defensive Employees

1. Recognize that defensive behaviour is normal

2. Never attack a person’s defenses

3. Postpone action

4. Recognize human limitations

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Ensuring the Discussion Leads to Improved Performance

1. Notify of unacceptable performance, explain minimum expectations

2. Ensure that expectations are reasonable

3. Explain role of warnings in the process of establishing just cause

4. Take prompt corrective measures

5. Avoid sending mixed messages

6. Provide a reasonable amount of time for improvement

7. Provide support to facilitate improvement

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Step 4: Determine Performance Rewards/Consequences

• provide performance awards: merit pay, extra pay

• important aspects used to determine the appropriate reward/consequence: • achievement of goals• how the employee meets the defined standards

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Step 5: Career Development Discussion

• manager and employee discuss opportunities for development

• based on current job requirements or future development

• business needs must be balanced with the employee’s preferences

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Legal and Ethical Issues

• determine required characteristics through job analysis

• use characteristics in rating system

• ensure ratees and raters know performance standards

• use clearly defined dimensions of performance

• avoid abstract trait names

• use subjective ratings as only one component

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Legal and Ethical Issues

• train supervisors

• allow raters regular contact with ratee

• have more than one rater, if possible

• use formal appeal mechanism

• document evaluations and reasons for termination

• provide corrective guidance to lower performers

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The Future of Performance Management

• Effective performance management involves:• linking individual goals and business strategy• showing leadership and accountability• ensuring close ties among appraisal results, rewards,

and recognition outcomes• investing in employee development planning• having an administratively efficient system with

sufficient communication support