Performance Appraisal Basics - continued

MANA 4328

Dr. Jeanne Michalski

michalski@uta.edu

Results-Based Appraisal

Uses future results as performance targets

Challenge is setting goals and measures Can the goals be quantified? Unique goals for every individual

Appraisal forms tend to be very simple

Still need a rating scale

Results-Based Appraisal

“Management by Objectives” or MBO Linking individual goals with business strategy Organizational goals flow down to depts. and employees Focus on planning, action items, and interim reviews Objectives negotiated and agreed upon by employees

Admissions Counselor

Job Function: Recruit at high schools in the southern Texas region

Standards: Make 2 visits per semester to each of the 7 high schools in your area. Prepare follow up packets to be sent to all students contacted during those visits. Send monthly update to the students indicating forms/ items still to complete.

Results-Based Appraisal

Focus on results compared to specific behaviors Should be clear and unambiguous Requires alignment of expectations May promote gaming of the system Beware of results at any cost and excessive results

orientation Time consuming and needs constant updating

How to Judge Appraisal Types

Leads to desired behaviors Minimizes negative behaviors Reliability and validity Perceived fairness (rater and employee) Performance improvement and employee development Flexibility and administrative cost

Comparison of Appraisal Forms

Ease of UseEmployee

DevelopmentLegal

Defensibility

Traits High Low Low

Behaviors Medium High High

Outcomes Low Medium Medium

Performance Management Cycle

Planning Performance for the Upcoming Period Defining key results for each position (usually 5-8) that

support the organization’s business strategy Establishing performance standards against which key

result areas will be measured May assign a weight to each key result since all key

results are NOT equal – adds complexity

Performance Management Cycle

Coaching Performance and Giving Feedback Throughout the Period Structured feedback like mid-period, quarterly, or

monthly progress reviews Informal feedback throughout the process

Rating Performance for the Just Completed Period One of the most challenging aspects is the approach for

rating employee performance

360 Degree Feedback

Evaluation method that incorporates feedback from the: worker, his/her peers, supervisors, direct reports, and customers.

Results of these confidential surveys are tabulated and shared with the worker.

Interpretation of the results, trends and themes are discussed as part of the feedback.

360 Degree Feedback

360 Successful in Organizations When:

360 Successful in Organizations When: Organizational climate fosters individual growth Proper framing of feedback method by management Assurance that feedback will be kept confidential Development of feedback tool based on organizational goals and

values Feedback tool includes area for comments Brief workers, evaluators and supervisors about purpose, uses of

data and methods of survey prior to distribution of tool Train workers in appropriate methods to give and receive feedback Support feedback with back-up services or customized coaching

360 Degree Feedback Errors

Feedback tied to merit pay or promotions Comments traced to individuals causing resentment

between workers Feedback not linked to organizational goals or values Use of the feedback tool as a stand alone without

follow-up Poor implementation of 360-degree tool negatively

affects motivation Excessive number of surveys are required of each

worker with few tangible results provided to individuals

Recommended 360 Degree Process

Leaders invite direct reports to evaluate them (if less than 5 direct reports, include second level direct reports)

Direct reports rate the leader through a survey tool (often web-based)

Outside consultant analyzes data and generates reports

Leaders and human resources consultant receive feedback report & have opportunity discuss results

Leaders give feedback to their direct reports through a facilitated high performing team session

Leaders create preliminary development plan and discuss with their supervisor

Key Questions to Consider When Receiving Feedback Do I understand it? Is it accurate/valid? Is it important? Do I want to change?

At its heart feedback is only information. How you choose to think and feel about the feedback will determine the value you gain from it.

Possible Reactions To Feedback

DENIAL

ANGER / FLIGHT

WITHDRAWAL

ACCEPTANCE

ANALYSIS

ACTION PLANNING

Guidelines for Discussion with Direct Reports Thank them for the feedback Share 2-3 strengths and 2-3 development needs Solicit additional insight or feedback Use open-ended questions Avoid defensiveness Communicate areas you will address in development

plan and solicit their support and on-going feedback

GOAL SETTING AND MOTIVATION

Goal Setting Basics

1. Specific2. Challenging3. Achievable4. Participatively set

“SMART” GoalsSpecific, Measurable, Attainable, Realistic, Trackable

Set interim or subgoals. Use action verbs. Specific dates, times, and amounts.

Participation

No one knows the job better than those who do it. Workers are more likely to accept the goals with input.

Employee

High

Employee

Low

Management

HighParticipation Unilateral

Management

Low

Empowered /

Self ManagedNo Goals

Why Do Goals Motivate?

Expectancy Theory

Motivation = E X I X V

Expectancy: The connection between behavior and the outcome

Instrumentality: The connection between outcome and a reward

Valence: Is the reward something that the individual values?

People are motivated by intrinsic and extrinsic rewards they desire. People will only be motivated if outcome is possible. People will only be motivated if outcome is contingent on behavior. People will only be motivated if a reward is attached to the outcome.

“Line of sight” is the perceived link between individual behavior and the reward.

Goal Challenge and Performance

Easy Moderately Difficult Extremely Difficult

High

Performance

Low

Performance

Note: Not to scale

Call Center?Call Center?Shipping?Shipping?Sales?Sales?R&D?R&D?

1.1.What performance measures What performance measures did Hiram put in place?did Hiram put in place?

2.2.What were the outcomes of the What were the outcomes of the measures?measures?

What measures did Hiram put in place?

What were the outcomes of the measures?

Careful What You Wish For

“You make the rules, we play the game.”

What do we want employees to do differently?

Why aren’t they doing it already?

Don’t sacrifice long-term business success for short-term goals.

Types of Goals

Behavioral goals vs. Outcome goals Often easier to observe outcomes Gives employee discretion on how to achieve goals

Use Outcome Goals When: Workers know how to achieve the goals Workers have the necessary resources

“Never tell people how to do things. Tell them what to do and they will surprise you with their ingenuity.”

General George S. Patton

Linking Individual & Organizational Goals

What are the ultimate goals? Profits, Sales, Customer Service, Quality Balanced scorecard

Don’t focus on intermediate goals unless they matter.

Consider the importance of coordination among employees or units.

Consult with business leaders and employees on appropriate goals