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2005 Prentice Hall Inc.All rights reserved.

PowerPoint Presentation by Charlie CookThe University of West Alabama

t e n t h e d i t i o n

Gary Dessler

Chapter9 Part 3 Training and Development

Performance Management

and Appraisal

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2005 Prentice Hall Inc. All rights reserved. 93

Comparing Performance Appraisal andPerformance Management

Performance appraisal

Evaluating an employees current and/or pastperformance relative to his or her performance

standards.Performance management

The process employers use to make sureemployees are working toward organizational

goals.

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Why Performance Management?

Increasing use by employers of performancemanagement reflects:

The popularity of the total quality management(TQM) concepts.

The belief that traditional performance appraisalsare often not just useless but counterproductive.

The necessity in todays globally competitiveindustrial environment for every employees

efforts to focus on helping the company to achieveits strategic goals.

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An Introduction to AppraisingPerformance

Why appraise performance?

Appraisals play an integral role in the employersperformance management process.

Appraisals help in planning for correctingdeficiencies and reinforce things done correctly.

Appraisals, in identifying employee strengths andweaknesses, are useful for career planning

Appraisals affect the employers salary raisedecisions.

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ClassroomTeaching

Appraisal ByStudents

Figure 91

Source: Richard I. Miller, Evaluating Faculty

for Promotional and Tenure (San Francisco:

Jossey-Bass Publishers, 1987), pp. 164165.

Copyright 1987, Jossey-Bass Inc.,

Publishers. All rights reserved. Reprinted with

permission.

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Realistic Appraisals

Motivations for soft (less-than-candid)appraisals

The fear of having to hire and train someone new

The unpleasant reaction of the appraisee

A company appraisal process thats not conduciveto candor

Hazards of giving soft appraisals

Employee loses the chance to improve beforebeing forced to change jobs.

Lawsuits arising from dismissals involvinginaccurate performance appraisals.

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Continuous improvement

A management philosophy that requiresemployers to continuously set and

relentlessly meet ever-higher quality, cost,

delivery, and availability goals by:

Eradicating the seven wastes: overproduction, defective products, and unnecessary

downtime, transportation, processing costs, motion, and

inventory.

Requiring each employee to continuously improvehis or her own personal performance, from oneappraisal period to the next.

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The Components of an EffectivePerformance Management Process

Direction sharing

Role clarification

Goal alignment

Developmental goal setting

Ongoing performance monitoring

Ongoing feedback

Coaching and support

Performance assessment (appraisal)

Rewards, recognition, and compensation

Workflow and process control and returnFigure 92

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Performance Appraisal Roles

Supervisors Usually do the actual appraising.

Must be familiar with basic appraisal techniques.

Must understand and avoid problems that can

cripple appraisals. Must know how to conduct appraisals fairly.

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Performance Appraisal Roles (contd)

HR department Serves a policy-making and advisory role.

Provides advice and assistance regarding theappraisal tool to use.

Prepares forms and procedures and insists that alldepartments use them.

Responsible for training supervisors to improvetheir appraisal skills.

Responsible for monitoring the system to ensurethat appraisal formats and criteria comply withEEO laws and are up to date.

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Steps in Appraising Performance

Defining the job Making sure that you and your subordinate agree

on his or her duties and job standards.

Appraising performance

Comparing your subordinates actual performanceto the standards that have been set; this usuallyinvolves some type of rating form.

Providing feedback

Discussing the subordinates performance andprogress, and making plans for any developmentrequired.

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Designing the Appraisal Tool

What to measure? Work output (quality and quantity)

Personal competencies

Goal (objective) achievement

How to measure?

Graphic rating scales

Alternation ranking method MBO

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Performance Appraisal Methods

Graphic rating scaleA scale that lists a number of traits and a range of

performance for each that is used to identify thescore that best describes an employees level ofperformance for each trait.

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GraphicRating Scalewith Space

forComments

Figure 93

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Portion of an Administrative Secretarys SamplePerformance Appraisal Form

Figure 94Source: James Buford Jr., Bettye Burkhalter, and Grover Jacobs, Link Job Description

to Performance Appraisals, Personnel Journal, June 1988, pp. 135136.

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Performance

Management Outline

Figure 95aSource: www.cwru.edu.

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PerformanceManagement

Outline(contd)

Figure 95cSource: www.cwru.edu.

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Performance Appraisal Methods (contd)

Alternation ranking method Ranking employees from best to worst on a

particular trait, choosing highest, then lowest,until all are ranked.

Paired comparison method Ranking employees by making a chart of all

possible pairs of the employees for each trait andindicating which is the better employee of the

pair.

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Alternation Ranking Scale

Figure 96

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Ranking Employees by thePaired Comparison Method

Figure 97

Note: + means better than. means worse than. For each chart, add up

the number of 1s in each column to get the highest-ranked employ ee.

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Forced distribution method Similar to grading on a curve; predetermined

percentages of ratees are placed in variousperformance categories.

Example: 15% high performers 20% high-average performers

30% average performers

20% low-average performers

15% low performers

Narrative Forms

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Behaviorally anchored rating scale (BARS)An appraisal method that uses quantified scale

with specific narrative examples of good and poorperformance.

Developing a BARS: Generate critical incidents

Develop performance dimensions

Reallocate incidents

Scale the incidents

Develop a final instrument

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Advantages of using a BARSA more accurate gauge

Clearer standards

Feedback

Independent dimensions Consistency

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Appraisal-Coaching

Worksheet

Figure 98

Source: Reprinted with permission of

the publisher, HRnext.com; copyright

HRnext.com, 2003.

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Examples of Critical Incidents foran Assistant Plant Manager

Table 91

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Example of aBehaviorally

Anchored Rating

Scale for theDimension

Salesmanship Skill

Figure 99

Source:Walter C. Borman, Behavior

Based Rating, in Ronald A. Berk (ed.),

Performance Assessment: Methods and

Applications (Baltimore, MD: Johns

Hopkins University Press, 1986), p. 103.

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Management by Objectives (MBO)

Involves setting specific measurable goalswith each employee and then periodically

reviewing the progress made.

1. Set the organizations goals.

2. Set departmental goals.3. Discuss departmental goals.

4. Define expected results (set individual goals).

5. Performance reviews.

6. Provide feedback.

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Computerized and Web-BasedPerformance Appraisal

Performance appraisal software programs

Keep notes on subordinates during the year.

Electronically rate employees on a series of

performance traits. Generate written text to support each part of the

appraisal.

Electronic performance monitoring (EPM)

Having supervisors electronically monitor theamount of computerized data an employee isprocessing per day, and thereby his or herperformance.

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Potential Rating Scale Appraisal Problems

Unclear standardsAn appraisal that is too open to interpretation.

Halo effect

Occurs when a supervisors rating of a subordinate

on one trait biases the rating of that person onother traits.

Central tendency

A tendency to rate all employees the same way,

such as rating them all average.

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A Graphic Rating Scale with Unclear Standards

Table 92

Note: For example, what exactly is meant by

good, quantity of work, and so forth?

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Potential Rating Scale Appraisal Problems(contd)

Strictness/leniency

The problem that occurs when a supervisor has atendency to rate all subordinates either high orlow.

Bias

The tendency to allow individual differences suchas age, race, and sex to affect the appraisal

ratings employees receive.

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How to Avoid Appraisal Problems

Learn and understand the potential problems,and the solutions for each.

Use the right appraisal tool. Each tool has its

own pros and cons.

Train supervisors to reduce rating errors such

as halo, leniency, and central tendency.

Have raters compile positive and negativecritical incidents as they occur.

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Who Should Do the Appraising?

The immediate supervisor

Peers

Rating committees

Self-ratings

Subordinates

360-Degree feedback

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Advantages and Disadvantages of Appraisal Tools

Table 93

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The Appraisal Interview

Types of appraisal interviews SatisfactoryPromotable

SatisfactoryNot promotable

UnsatisfactoryCorrectable

UnsatisfactoryUncorrectable

How to conduct the appraisal interview

Talk in terms of objective work data.

Dont get personal.

Encourage the person to talk.

Dont tiptoe around.

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PerformanceContract

Figure 910

Source: David Antonion, Improving the

Performance Management Process Before

Discontinuing Performance Appraisals,

Compensation and Benefits Review May

June 1994, p. 33, 34.

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ChecklistDuring the

AppraisalInterview

Figure 911

Source: Reprinted with permission of

the publisher, HRnext.com. Copyright

HRnext.com, 2003.

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The Appraisal Interview (contd)

How to handle a defensive subordinate Recognize that defensive behavior is normal.

Never attack a persons defenses.

Postpone action.

Recognize your own limitations.

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How to criticize a subordinate Do it in a manner that lets the person maintain his

or her dignity and sense of worth.

Criticize in private, and do it constructively.

Avoid once-a-year critical broadsides by givingfeedback on a daily basis, so that the formalreview contains no surprises.

Never say the person is always wrong Criticism should be objective and free of any

personal biases on your part.

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How to ensure the interview leads to

improved performance

Dont make the subordinate feel threatened duringthe interview.

Give the subordinate the opportunity to presenthis or her ideas and feelings and to influence thecourse of the interview.

Have a helpful and constructive supervisor

conduct the interview. Offer the subordinate the necessary support for

development and change.

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Creating the Total PerformanceManagement Process

What is our strategy and what are our

goals?

What does this mean for the goals we set for

our employees, and for how we train,appraise, promote, and reward them?

What will be the technological support

requirements?

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Information Required for TRWs Web-BasedPerformance Management System

Figure 912Source: D. Bradford Neary,Creating a Company-Wide, Online, Performance Management System:

A Case Study at TRW, Inc., Human Resource Management 41, no 4 (Winter 2002), p. 495.

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Figure13

HR Scorecardfor Hotel Paris

InternationalCorporation*

Note: *(An abbreviated example showing selected

HR practices and outcomes aimed at implementing

the competitive strategy, To use superior guest

services to differentiate the Hotel Paris properties

and thus increase the length of stays and the return

rate of guests and thus boost revenues and

profitability)

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Key Terms

performance appraisal

performance management

graphic rating scale

alternation ranking method

paired comparison method

forced distribution method

critical incident method

behaviorally anchored rating

scale (BARS)

management by objectives(MBO)

electronic performance

monitoring (EPM)

unclear standards

halo effect

central tendency

strictness/leniency

bias

appraisal interview

Documents

HRM10eCH090