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The process through which managers ensure that employees' activities and outputs contribute to the organizations goals

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Performance Management

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Specify relevant aspects of performance, appraise performance, provide performance feedback > problem solving and rewards

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Stages of Performance Management

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effective performance management helps the organization achieve its business objectives.

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Strategic Purpose

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ways in which organizations use the system to provide information for day-to-day decisions about salary, benefits, and recognition programs.

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Administrative Purpose

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serves as a basis for developing employees' knowledge and skills.

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Developmental Purpose

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strategic

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An organization helps link employees' behavior with the organization's goals. This helps the organization serve its _____ purpose.

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feedback as to how well the organization is implementing various policies

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Performance Measurement provides

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that what is measured will be noticed. Measures affect behavior, even if there are no direct, immediate consequences for good or bad performance on the measure.

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Performance Measurement ensures

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1: Define performance outcomes for company division and department 2: Develop employee goals, behavior, and actions to achieve outcomes 3: Provide support and ongoing performance discussions 4: Evaluate performance 5: Identify improvements needed 6. Provide consequences for performance results.

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STEPS IN THE PERFORMANCE MANAGEMENT PROCESS

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how much do different raters agree?

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Interrater reliability

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consistency of results over time. Can we rely on this rating method to capture performance improvement/deterioration over time?

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Test-retest reliability

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The approach to performance feedback is generally most effective.

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problem-solving

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reliability

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With regard to a performance measure, _____describes the consistency of the results that the performance measure will deliver.

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involuntary

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Terminating an employee for the use of illegal drugs is an example of a(n) _____ turnover.

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Comparative Attribute Quality Results Behavior

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Methods for Measuring Performance

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Fit with strategy Validity Reliability Acceptability Specificity

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Criteria for best measurement approaches

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Simple Ranking Forced Distribution Paired Comparison

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Making comparisons between appraisal method

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Requires managers to rank employees in their group from the highest performer to the poorest performer

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Simple Ranking

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Assigns a certain percentage of employees to each category in a set of categories

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Forced Distribution

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Compares each employee with each other employee to establish ranking

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Paired Comparision

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List traits and provide a rating scale for each trait. Employer uses the scale to indicate extent to which an employee displays each trait

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Graphic Rating Scales

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Uses several statements describing each trait to produce a final score for that trait

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Mixed- Standard Scale

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An employee's performance measurement differs from job to job. For example, a car dealer's performance is measured by the dollar amount of sales, the number of new customers, and customer satisfaction surveys.

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How would the performance measurements of a car dealer differ from those of an auto mechanic?

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Based on managers records of specific examples of employees acting in ways that are either effective or ineffective. Employees receive feedback about what they do well and what they do poorly and how they are helping the organization achieve its goals

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Critical-Incident method

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Rates behavior in terms of scale showing specific statements of behavior that describe different levels of performance.

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Behaviorally-anchored rating scale

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A variation of a BARS which uses all behaviors necessary for effective performance to rate performance at a task. A BOS also asks the manager to rate frequency with which the employee has exhibited the behavior during rating period.

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Behavioral Observation Scale (BOS)

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A plan for managing behavior of employees through a formal system of feedback and reinforcement.

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Organizational Behavior Modification (OBM)

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people at each level of the organization set goals in a process that flows from top to bottom, so that all levels are contributing to the organization's overall goals. These goals become the standards for evaluating each employee's performance.

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Management by Objectives (MBO)

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Loan portfolio management Sales

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Two objectives for a bank

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Paired Comparisons;

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The performance management system at XYZ company currently is perceived as unfair and is time-consuming for managers. Which of the following systems is the most likely and least likely used, respectively. Paired comparisons; Results Results; Forced distribution Behavioral; Attributes Attributes; Comparative

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provide methods for performance measurement and management- combines measurements of attributes and results.

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total quality management

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performance measurement that combines information from the employees': Managers Peers Subordinates Self Customers

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360-Degree Performance Appraisal

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Performance management

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What is critical for executing a talent management system and involves one-on-one contact with managers to ensure that proper training and development are taking place?

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Contrast, Distributional, Rater bias

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Rating Errors

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rater compares an individual, not against an objective standard, but against other employees.

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Contrast errors

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rater tends to use only one part of a rating scale. Leniency: the reviewer rates everyone near the top Strictness: the rater favors lower rankings Central tendency: the rater puts everyone near the middle of the scale

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Distributional errors

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raters often let their opinion of one quality color their opinion of others. Halo and Horns error

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Rater bias

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when bias is in a favorable direction. This can mistakenly tell employees they don't need to improve in any area

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Halo error

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when bias involves negative ratings. This can cause employees to feel frustrated and defensive.

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Horns error

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B. Strictness; Halo

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Bill rates all of his employees very low except for Jan. Jan gets above average ratings because she consistently comes to work on time. The rating errors Bill makes are _______ and _______, respectively. A. Leniency; Horn B. Strictness; Halo C. Similar-to-me; Central Tendency D. Horn; Strictness

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to hold calibration meetings

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Sometime raters intentional distort their ratings for personal gain. One technique to minimize appraisal politics is

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Tell and sell Tell and listen Problem solving

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Performance feedback approaches

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managers tell employees their ratings and then justify those ratings

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Tell-and-Sell

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managers tell employees their ratings and then let employees explain view

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Tell-and-Listen

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managers and employees work together to solve performance problems

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Problem-Solving

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focus on goals listen as well as talk be honest prevent surprises use specific concrete examples treat employees with respect

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6 ways to structure communication

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Rewards and direct feedback

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What helps to maintain these employees' high motivation levels?

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Based on valid job analyses, with requirements for job success clearly communicated to employees. Evaluates behaviors or results, rather than traits. Multiple raters (including self-appraisals) used. All performance ratings reviewed by upper-level managers. Appeals mechanism for employees.

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A legally defensible performance management system is:

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establishing a fair appraisal system, involving managers and employees in developing the system, allowing employees to challenge evaluations, communicating expectations, and having open discussion

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Organizations can minimize appraisal politics by

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