Managing Human Resources Chapter 8 Performance Management and the Employee Appraisal Process

performance management
the process of creating a work environment in which people can perform to the best of their abilities in order to meet a company’s goals. It is an entire work system that emanates from a company’s goals.
performance appraisals
which are an important part of performance management systems, are the result of an annual or biannual process in which a manager evaluates an employee’s performance relative to the requirements of his or her job and uses the information to show the person where improvements are needed and why. Appraisals are therefore a tool organizations can use to maintain and enhance their productivity and facilitate progress toward their strategic goals.
steps in performance management
1. goals set to align to higher level goals
2. behavioral expectations and standards set and then aligned with employee and org goals
3. ongoing performance feedback during cycle
4. performance appraised by manager
5. formal review session conducted
6. HR decision making
ongoing performance feedback
better both parties, everyone benefits
8 points to address during feedback
1. Give specific examples of desirable and undesirable behaviors. Without specific examples of real life situations, the employee will only be confused by the vague-ness of the feedback.

2. Focused feedback on behavior, not the person. This will help the employee to “hear” the message and will defuse what could be a confrontational conversation.

3. Frame the feedback in turns of helping the employee be successful. Let the employee know that you are trying to help him or her be a successful employee within the organization.

4. Direct the feedback towards behavior the employee can control. Employees cannot do much about things over which they have no control.

5. The feedback should be timely. When an event takes place, it is important to provide feedback within a reasonable amount of time.

6. Limit feedback to the amount the employee can process. Most employees are able to handle feedback on one or two issues at a time.

7. Use active communication skills and confirm the employee is engaged in the conversation.

focal performance appraisal
An appraisal system in which all of an organization’s employees are reviewed at the same time of year rather on the anniversaries of their individual hire dates

one in which all employees of a company are reviewed at the same time of year rather than on the anniversary dates they were hired. This appraisal strategy can be very helpful if a company is experiencing change and must quickly alter its strategy. After the new strategic goals of the firm are es-tablished, they can then be translated into individual goals employees receive all at the same time. That way, all employees can begin working toward those goals imme-diately. A focal performance appraisal also enables managers to compare the perfor-mance of different employees simultaneously, which can result in appraisals that are more accurate and fair. The review of an employee is also less likely to be overlooked if all of an organization’s managers review employees at the same time.

purposes of performance appraisal
Good appraisal systems have the capabil-ity to influence employee behavior and improve an organization’s performance. One study showed that organizations with strong performance management systems are 40 to 50 percent more likely to outperform their competitors in the areas of revenue growth, productivity, profitability, and market value. This is why experts advise com-panies to continue to appraise their employees during an economic downturn, even if they cannot afford to give them raises.

also ensure employees get at least some feedback from their supervisors.

two most common purposes of performance appraisals, which are administrative and developmental .

administrative purposes
Appraisal programs provide input that can be used for the entire range of HRM ac-tivities, such as promotions, transfers, layoffs, and pay decisions. The practice of “pay-for-performance”—basing employees’ pay on their achievements—is found in all types of organizations.

Document personnel decisions
Promote employees
Determine transfers and assignments
Identify performance problems and develop ways to correct them
Make retention, termination, and layoff decisions Validate selection criteria
Meet legal requirements
Evaluate training programs/progress
Assist with human resources planningMake reward and compensation decisions

developmental purposes
Provide performance feedback Identify individual strengths and weaknesses
Recognize individual performance achievements
Help employees identify goals
Evaluate goal achievement of employees
Identify individual training needs
Determine organizational training needs
Reinforce authority structure
Allow employees to discuss concerns
Improve communication
Provide a forum for leaders to help employees
why appraisal programs sometimes fail
– often fall short of their potential.
– people believe performance appraisals discourage teamwork because it frequently focuses on the individual achievements of workers versus what their teams or firms accomplish.
– often focus on short-term achievements rather than long-term improvement and learning.

There are many reasons why performance appraisal systems might not be effective. Some of the most common problems include the following:
• Inadequate preparation on the part of the manager.
• Employee is not given clear objectives at the beginning of performance period.
• Manager may not be able to observe performance or have all the information.
• Performance standards may not be clear.
• Inconsistency in ratings among supervisors or other raters.
• Manager rating personality rather than performance.
• The halo effect, contrast effect, or some other perceptual bias.
• Inappropriate time span for evaluation (either too short or too long).
• Overemphasis on uncharacteristic performance.
• Inated ratings because managers do not want to deal with “bad news.”
• Subjective or vague language in written appraisals.
• Organizational politics or personal relationships cloud judgments.
• No thorough discussion of causes of performance problems.
• Manager may not be trained at evaluation or giving feedback.
• No follow up and coaching after the evaluation.

strategic relevance (considerations in developing effective appraisal program)
refers to the extent to which the standards of an appraisal relate to the strategic objectives of the organization in which they are applied. For example, if an organization has established a standard that “95 percent of all customer com-plaints are to be resolved in one day,” then it is relevant for the customer service rep-resentatives to be held to this standard when they are evaluated.
criterion deficiency (considerations in developing effective appraisal program)
extent to which the standards capture the entire range of an employee’s responsibilities. When perfor-mance standards focus on a single criterion (such as sales revenues) to the exclusion of other important but less quantifiable performance dimensions (such as customer service), then the appraisal system is said to suffer from criterion deficiency
criterion contamination
Just as performance criteria can be deficient, they can also be contaminated. There are factors outside an employee’s control that can influence his or her performance. A comparison of performance of production workers, for example, should not be con-taminated by the fact that some work with newer machines than others do. A com-parison of the performance of traveling salespeople should not be contaminated by the fact that territories differ in terms of their sales potential.
refers to the stability or consistency of a stan-dard, or the extent to which individuals tend to maintain a certain level of performance over time. In terms of appraisal ratings, reliability can be measured by correlating two sets of ratings made by a single rater or by two different raters. For example, two man-agers would rate the same individual and estimate his or her suitability for a promotion. Their ratings would then be compared to determine inter-rater reliability.
A process whereby manag-ers meet to discuss the performance of individual employees to ensure their employee appraisals are in line with one another
performance appraisals should meet the following legal guidelines
– Performance ratings must be job-related, with performance standards developed through a job analysis. -Only evaluate those areas that are necessary for effective job performance.
– Employees must be provided with clear, written job standards in advance of their appraisals so they understand what they need to do to get top ratings.
– Managers who conduct the appraisals must be able to observe the behavior they are rating. This implies having measurable standards with which to compare employee behavior.
– Do not allow performance problems to continue unchecked. Document problems when they occur and refer to them in employeesí appraisals.
– Supervisors should be trained to use the appraisal form correctly. They should be instructed as to how to apply the appraisal standards when making judgments.
– The appraisals should be discussed openly with employees and counseling or corrective guidance offered to help poor performers improve their performance.
– Be open to the possibility that employees could be transferred to other positions that better suit their abilities.
– An appeals procedure should be established to enable employees to express their disagreement with the appraisals.
who should appraise employee performance
the raters can include supervisors, peers, team members, themselves, subordinates, customers, vendors, and suppliers.
Manager and/or supervisor appraisal
A performance appraisal done by an employee’s manager and often reviewed by a manager one level higher

has been the traditional approach to evaluat-ing an employee’s performance. In most instances, supervisors are in the best position to perform this function, although it may not always be possible for them to do so. Managers with many subordinates often complain that they do not have the time to fully observe the performance of each of them. These managers must then rely on per-formance records to evaluate an employee’s performance.

beneficial when managers seek to increase an employee’s involve-ment in the review process. A self-appraisal system requires an employee to complete the appraisal form prior to the performance interview. At a minimum, this gets the employee thinking about his or her strengths and weaknesses and may lead to dis-cussions about barriers to effective performance. During the performance appraisal, the manager and the employee discuss the employee’s job performance and agree on a final appraisal. This approach also works well when the manager and the employee jointly establish future performance goals or employee development plans.
subordinate appraisal
have been used by both large and small organizations to give managers feedback on how their subordinates view them. 19 Subordinates are in a good position to evaluate their managers because they are in frequent contact with their superiors and occupy a unique position from which to observe many performance-related behaviors. Subordinate appraisals have also been shown to improve the performance of managers. The performance dimensions judged most appropriate for subordinates to appraise include a manager’s leadership, oral commu-nication, delegation of authority, coordination of team efforts, and interest in his or her subordinates. However, dimensions related to managers’ specific job tasks, such as planning and organizing, budgeting, creativity, and analytical ability, are not usually considered appropriate dimensions for subordinates to appraise.
peer appraisal
A performance appraisal done by one’s fellow employ-ees, generally on forms that are compiled into a single profile for use in the perfor-mance interview conducted by the employee’s manager
team appraisal
A performance appraisal, based on TQM (total quality management) concepts, that recognizes team accomplish-ment rather than individual performance

At its root, TQM is a control system that in-volves setting standards (based on cus-tomer requirements), measuring a firm’s performance against those standards,
and identifying opportunities for continuous improvement. In this regard, TQM and performance appraisals complement one another. However, a basic tenet of TQM is that a firm’s performance is best understood at the level of the system as a whole, whereas performance appraisals traditionally focus on individual performance.
An extension of the peer appraisal is the team appraisal. In a team setting, it may be nearly impossible to separate out an individual’s contribution. Advocates of team appraisals argue that, when this is the case, individual appraisals can be dysfunctional and distract a team from focusing on critical issues.
and identifying opportunities for continuous improvement. In this regard, TQM and performance appraisals complement one another. However, a basic tenet of TQM is that a firm’s performance is best understood at the level of the system as a whole, whereas performance appraisals traditionally focus on individual performance.

customer appraisal
source of performance appraisal information. External customers’ evaluations, of course, have been used for some time to appraise restaurant personnel.
360-degree appraisal or feedback
intended to provide employees with as accurate a view of their performance as possible by getting input from all angles: supervisors, peers, subordinates, customers, and the like.
pros of 360-degree
PROS • The system is more comprehensive in that responses are gathered from multiple perspectives. • Quality of information is better. (Quality of respondents is more important than quantity.)• It complements TQM initiatives by emphasizing internal/eternal customers and teams.• It may lessen bias/prejudice since feedback comes from more people, not one individual. • Feedback from peers and others may increase employee self-development.
cons of 360-degree
The system is comple in combining all the responses.• Feedback can be intimidating and cause resentment if employee feels the respondents have “ganged up.”• There may be conicting opinions, though they may all be accurate from the respective standpoints. • The system requires training to work effectively.• Employees may collude or “game” the system by giving invalid evaluations to one another. • Appraisers may not be accountable if their evaluations are anonymous.
safeguards to ensure its maximum quality and acceptance of 360-degree
Assure anonymity ■ . Make certain that no employee ever knows how any evalu-ation team member responded. (The supervisor’s rating is an exception to this rule.) Make respondents accountable ■ . Supervisors should discuss each evaluation team member’s input, letting each member know whether he or she used the rating scales appropriately, whether his or her responses were reliable, and how other participants rated the employee. Prevent “gaming” of the system ■ . Some individuals may try to help or hurt an employee by giving either too high or too low an evaluation. Team members may try to collude with one another by agreeing to give each other uniformly high ratings. Supervisors should check for obviously invalid responses. Use statistical procedures ■ . Use weighted averages or other quantitative approaches to combine evaluations. Supervisors should be careful about using subjective combinations of data, which could undermine the system. Identify and quantify biases ■ . Check for prejudices or preferences related to age, gender, ethnicity, or other group factors.
training appraisers
A weakness of many performance appraisal programs is that managers and super-visors are not adequately trained for the appraisal task, and so the feedback they provide their subordinates is not as useful as it might be and can often be meaning-less, if not destructive. This is perhaps one reason why some experts believe firms should no longer
Establishing an Appraisal Plan
training program for raters is most effective when it follows a systematic process that begins with an explanation of the objectives of the firm’s performance appraisal system. It is also important for the rater to know the purpose for which the appraisal is to be used.
eliminating rater error
Appraisal training should focus on eliminating the subjective errors made by manag-ers in the rating process.
types: halo and horn, distributional
halo error
we looked at selecting employees can occur during the appraisal process if raters do not have carefully developed de-scriptions of the employee behaviors being rated.
horn error
the opposite of the halo effect. It occurs when a manager focuses on one negative aspect about an employee and generalizes it into an overall poor appraisal rating. A personality conflict between a manager and his or her employees increases the probability of the horn effect, which can lead to a high level of frustration on the employee’s part if it is not corrected.
in that they involve a group of ratings given across various employees.
error of central tendency
raters who are reluctant to assign either extremely high or extremely low ratings commit the . In this case, all employees are rated about average. It is a good idea to explain to raters that among large numbers of employees, one should expect to find significant differences in their behavior, productivity, and other characteristics.
leniency or strictness error
In contrast to central tendency errors, it is also common for some raters to give unusually high or low ratings. For example, a manager might erroneously assert, “All my employees are excellent” or “None of my people are good enough.” These beliefs give rise to what is called ________

One way to reduce this error is to clearly define the characteristics or dimensions of performance and to provide meaningful descriptions of behavior, known as “anchors,” on the scale.

forced distribution
scale. An-other approach is to require ratings to conform to a forced distribution, which is also sometimes referred to as forced ranking. Managers appraising employees under a forced distribution system are required to place a certain percentage of employees into various performance categories.
forced ranking
A performance appraisal ranking system whereby raters are required to place a certain percentage of employees into various performance categories
rating errors
Although forced distribution and peer ranking may solve leniency and strictness errors, they can create other rating errors—particularly if most employees are per-forming above standard. Moreover, if the system has a disparate impact on a legally protected group, such as a minority or older employers, it can result, and has re-sulted, in discrimination lawsuits, which GE, among other companies, has experi-enced firsthand.
temporal rating error
Some rating errors are ____________________ in that the performance review is biased either favorably or unfavorably, depending on the way performance information is se-lected, evaluated, and organized by the rater over time.
recency error
when the appraisal is based largely on the employee’s recent behavior, good or bad, the rater has committed the _______________

Managers who give higher ratings because they believe an employee is “showing improvement” may unwittingly be committing recency error. Without work record documentation for the entire appraisal pe-riod, the rater is forced to recall recent employee behavior to establish the rat-ing. Having the rater routinely document employee accomplishments and failures throughout the whole appraisal period can minimize the recency error. One way for managers to do this is by keeping a diary or a log. Rater training also will help reduce this error.

contrast error
occurs when an employee’s evaluation is biased either upward or downward because of another employee’s performance, evaluated just previ-ously. For example, an average employee may appear especially productive when compared with a poor performer. However, that same employee could appear un-productive when compared with a star performer. Contrast errors are most likely when raters are required to rank employees in order from the best to the poorest.
similar-to-me error
occurs when appraisers inflate the evaluations of peo-ple with whom they have something in common. For example, if both the manager and the employee are from the same state or went to the same schools, the manager may unwittingly have a more favorable impression of the employee. The effects of a similar-to-me error can be powerful, and when the similarity is based on race, reli-gion, gender, or some other protected category, it can result in discrimination.
feedback training
a training program for raters should provide some general points to consider for planning and providing feedback on an ongoing basis and during the appraisal interview. Managers need to understand that employees want feedback—that is, they want to know how they are doing and how they can improve. They are less eager to be appraised or judged. This is why it is important for their managers to provide them with ongoing feedback and not just “dump on them” during a formal appraisal. Feedback training should cover at least three basic areas: (1) communicating effec-tively, (2) diagnosing the root causes of performance problems, and (3) setting goals and objectives.
performance appraisal methods
trait methods
– graphic rating scales
– mixed standard scales
– forced choice
– essay method

behavioral methods
– critical incident method
– behavioral checklist method
– behaviorally-anchored rating scale (BARS)
– Behavior observation scale

results methods
– productivity measures
– management by objectives
– balanced scorecard

trait methods
to performance appraisal are designed to measure the extent to which an employee possesses certain characteristics—such as dependability, creativity, initiative, and leadership—that are viewed as important for the job and the organi-zation in general. Trait methods became popular because they are easy to develop. However, if not designed carefully on the basis of job analysis, trait appraisals can be notoriously biased and subjective.
graphic rating scales
each trait or characteristic to be rated is repre-sented by a scale on which a rater indicates the degree to which an employee possesses that trait or characteristic. An example of this type of scale is shown in Highlights in HRM 2. There are many variations of the graphic rating scale. The differences are to be found in (1) the characteristics or dimensions on which individuals are rated, (2) the degree to which the performance dimension is defined for the rater, and (3) how clearly the points on the scale are defined. In Highlights in HRM 2, the dimensions are defined briefly, and some attempt is made to define the points on the scale. Subjectivity bias is reduced somewhat when the dimensions on the scale and the scale points are defined as precisely as possible. This can be achieved by training raters and by including descriptive appraisal guidelines in a performance appraisal reference packet.
mixed-standard scales
is a modification of the basic rating scale method. Rather than evaluating traits according to a single scale, the rater is given three spe-cific descriptions of each trait. These descriptions reflect three levels of performance: superior, average, and inferior. After the three descriptions for each trait are writ-ten, they are randomly sequenced to form the mixed-standard scale.
forced-choice method
A trait approach to perfor-mance appraisal that requires the rater to choose from statements designed to distin-guish between successful and unsuccessful performance
essay methood
A trait approach to per-formance appraisal that requires the rater to com-pose a statement describing employee behavior
behavioral methods
one of the potential drawbacks of a trait-oriented performance appraisal is that traits tend to be vague and subjective. We discussed earlier that one way to improve a rating scale is to have descriptions of behavior along a scale, or continuum. These descriptions permit the rater to readily identify the point where a particular employee falls on the scale. Behavioral methods have been developed to specifically describe which actions should (or should not) be exhibited on the job. They are also often used to provide employees with developmental feedback
critical incident method
An unusual event that de-notes superior or inferior employee performance in some part of the job
An example of a favorable critical incident occurs when a janitor observes that a file cabinet containing classified documents has been left unlocked at the close of business and calls the firm’s security officer to correct the problem. An example of an unfavorable incident occurs when a mail clerk fails to deliver an Express Mail package immediately, instead putting it in with regular mail to be routed two hours later. The manager keeps a log or diary for each employee throughout the appraisal period and notes specific critical incidents related to how well they perform.
behavioral checklist method
One of the oldest appraisal techniques is the behavioral checklist method. It con-sists of having the rater check the statements on a list that the rater believes are characteristic of the employee’s performance or behavior.
behaviorally anchored rating scale (BARS)
A behavioral approach to performance appraisal that consists of a series of vertical scales, one for each important dimension of job performance. hese dimensions are anchored by behaviors identified through a critical incident job analysis. The critical incidents are placed along the scale and are assigned point values according to the opinions of experts.
behavioral observation scale
A behavioral approach to performance appraisal that measures the frequency of observed behavior

is similar to a BARS in that they are both based on critical incidents. However, the lower portion of Highlights in HRM 4 shows that rather than asking the evaluator to choose the most representative behav-ioral anchor, a BOS is designed to measure how frequently each of the behaviors has been observed.

results method
Rather than looking at the traits of employees or the behaviors they exhibit on the job, many organizations evaluate employees’ accomplishments—the results they achieve through their work. Advocates of results appraisals argue that they are more objective and empowering for employees. Looking at results such as sales figures and production output involves less subjectivity and therefore may be less open to bias. Furthermore, results appraisals often give employees responsibility for their outcomes while giving them discretion over the methods they use to accomplish them (within limits). This is employee empowerment and engagement in action.
productivity measures
A number of results measures are available to evaluate performance. Salespeople are evaluated on the basis of their sales volume (both the number of units sold and the dollar amount in revenues). Production workers are evaluated on the basis of the number of units they produce and perhaps the scrap rate or number of defects that are detected. Executives are frequently evaluated on the basis of company profits or growth rate. Each of these measures directly links what employees accomplish to re-sults that benefit the organization. In this way, results appraisals can directly align employee and organizational goals.
management by objectives
A philosophy of manage-ment that rates performance on the basis of employee achievement of goals set by mutual agreement of em-ployee and manager

One method that attempts to overcome some of the limitations of results appraisals is management by objectives (MBO) . MBO is a philosophy of management that has employees establish objectives (such as production costs, sales per product, qual-ity standards, and profits) by consulting with their superiors. Employees are then evaluated based on these objectives. 46 An MBO system (see Figure 8.7) consists of a cycle that begins with setting the organization’s common goals and objectives and ultimately returns to that step. The system acts as a goal-setting process whereby ob- jectives are established for the organization (Step 1), departments (Step 2), and indi-vidual managers and employees (Step 3). Employee- established goals are discussed with the supervisor and jointly reviewed and modified until both parties are satisfied with them (Step 4). The goal statements are accompanied by a detailed account of the actions the employee proposes to take to reach the goals. During periodic reviews, as objective data are made available, the progress that the employee is making toward the goals is then assessed (Step 5).

balanced scorecard
can be used to appraise individual employees, teams, business units, and the corporation itself. A BSC appraisal takes into account four related categories: (1) financial, (2) cus-tomer, (3) processes, and (4) learning. These internal processes—product devel-opment, service, and the like—are critical for creating customer satisfaction and loyalty. In turn, creating value for customers is what drives a firm’s financial perfor-mance and profitability.
method performance appraisal to use?
Although researchers and HR managers generally believe that the more sophisticated and time-consuming methods offer more useful information, this may not always be the case. Ronald Gross, an industrial psychologist and human resources consultant, states: “I can’t judge a performance appraisal system just by looking at the paperwork. The back of an envelope can work just fine. I’ve seen many systems fail miserably because they’re too complex, too time-consuming, and too burdensome. I’ve never seen a system fail because it was too simple.” 49 One way to assess whether an organization’s appraisal system is effective is by doing an annual, or at least periodic, audit of the process using a survey instrument that both managers and employees complete on a periodic basis. This should give HR a better sense of whether the appraisal process is improving.Of course, having a first-rate appraisal method does no good if the manager simply “shoves the information in a drawer.” Even a rudimentary system, when used prop-erly, can initiate a discussion between managers and employees that genuinely leads to better performance on the part of individual workers. In addition, as we have ex-plained, performance appraisals should not be just for middle managers and rank-and-file employees. If the organization’s goals are to cascade downward, the firm’s top executives need to be involved in the appraisal process as well.
appraisal interviews
is perhaps the most important part of the entire performance appraisal process. The appraisal interview gives a manager the opportunity to discuss a subordinate’s performance record and to explore areas of possible improvement and growth. The format for the appraisal interview will be determined in large part by the purpose of the interview, type of appraisal system used, and organization of the interview form. Most appraisal interviews attempt to give feedback to employees on how well they are doing their jobs and on planning for their future development. In-terviews should be scheduled far enough in advance to allow the interviewee, as well as the interviewer, to prepare for the discussion. Usually ten days to two weeks is a sufficient amount of lead time.
has three types
Tell-and-Sell Interview.
■ The skills required in the tell-and-sell interview include the ability to persuade an employee to change in a prescribed manner. This may require the development of new behaviors on the part of the employee and skillful use of motivational incentives on the part of the appraiser/supervisor
Tell-and-Listen Interview.
■ In the tell-and-listen interview, the appraiser/supervisor communicates the strong and weak points of an employee’s job performance during the first part of the interview. During the second part of the interview, the employee’s feelings about the appraisal are thoroughly explored. The tell-and-listen method gives both managers and employees the opportunity to release and iron out any frustrating feelings they might have.
Problem-Solving Interview.
■ Listening, accepting, and responding to feelings are essential elements of the problem-solving interview. However, this method goes beyond an interest in the employee’s feelings. It seeks to stimulate the growth and development of an employee by discussing his or her problems, needs, and on-the- job satisfaction and dissatisfaction.
conducting the appraisal interview
There are probably no hard-and-fast rules for how to conduct an appraisal interview, but some guidelines can increase an employee’s willingness to discuss his or her per-formance and improve it, accept feedback from his or her supervisors, and increase There are probably no hard-and-fast rules for how to conduct an appraisal interview, but some guidelines can increase an employee’s willingness to discuss his or her per-formance and improve it, accept feedback from his or her supervisors, and increase
ask for a self-assessment
it is useful to have employees evaluate their own performance prior to the appraisal interview. Even if this information is not used to determine the final rating on the review, the self-appraisal starts the employee think-ing about his or her accomplishments. Self-appraisal also ensures that the employee knows against what criteria he or she is being evaluated, thus eliminating any poten-tial surprises.Recent research suggests that employees are more satisfied and view the appraisal system as providing more procedural justice when they have input into the process. When the employee has evaluated his or her own performance, the interview can be used to discuss areas in which the manager and the employee have reached different conclusions—not so much to resolve the “truth,” but to work toward the resolution of problems.
invite participation
Most experts advise supervisors to encourage their employees to speak freely and listen closely to what they have to say during appraisal interviews. These experts emphasize that the communication during performance appraisals should be a two-way street. To the extent that an employee is an active participant in that discussion, the more likely it is that the root causes and obstacles to his or her performance will be uncovered and that constructive ideas for improvement will be developed.
express appreciation
Praise is a powerful motivator, and in an appraisal interview, particularly, employ-ees are seeking positive feedback. It is frequently beneficial to start the appraisal interview by expressing appreciation for what the employee has done well. In this way, he or she may be less defensive and more likely to talk about aspects of the job that are not going so well. However, supervisors should try to avoid the obvi-ous use of the “sandwich technique” in which positive statements are followed by negative ones, which are then followed by positive statements. This approach may not work for several reasons. Praise often alerts the employee that criticism will be coming. If managers follow an appraisal form, the problem of the sandwich tech-nique will often be avoided. Furthermore, if employees are kept informed of their behavior on a regular basis, there will be no need to use this appraisal technique.
minimize criticism
Even the most stoic employees can absorb only so much criticism before they start to get defensive. If an employee has many areas in need of improvement, managers should focus on the issues that are most problematic or most important to the job. In other words, criticism should be given in. some tips:

1. consider what is necessary
2. consider the person
3. be specific and do not exaggerate
4. watch your timing
5. make improvements with your goal

change the behavior not the person
Managers frequently try to play psychologist, to “figure out” why an employee has acted a certain way. Empathizing with employees in order to understand their point of view can be very helpful. However, when dealing with a problem area, in particular, remember that it is not the person who is bad, but the actions exhibited on the job. Avoid making suggestions to employees about personal traits they should change; instead suggest more acceptable ways of performing. For example, instead of focusing on a person’s “unreliability,” a manager might focus on the fact that the employee “has been late to work seven times this month.” It is difficult for employees to change who they are; it is usually much easier for them to change how they act.
focus on solving problems
When addressing performance issues, it is also frequently tempting to get into the “blame game” in which both manager and employee enter into a potentially endless discussion of why a situation has arisen. Frequently, solving problems requires an analysis of the causes, but ultimately the appraisal interview should be directed at devising a solution to the problem.
be supportive
One of the better techniques for engaging an employee in the problem-solving process is for the manager to ask: “What can I do to help?” Employees frequently attribute performance problems to either real or perceived obstacles (such as bureaucratic pro-cedures or inadequate resources). By being open and supportive, the manager conveys to the employee that he or she will try to eliminate roadblocks and will work with the employee to achieve a higher standard of performance.
establish goals
Because one of the major purposes of the appraisal interview is to improve an em-ployee’s future performance, his or her manager should focus the person’s attention on the future rather than the past:

Emphasize strengths on which the employee can build rather than weaknesses to ■ overcome and how the employee’s efforts will contribute to the organization dur-ing the coming year.
Concentrate on opportunities for growth that exist within the framework of the ■ employee’s present position and drop unproductive tasks.
Limit plans for growth to a few important items that can be accomplished within a ■ reasonable period of time.
Establish specific action plans that spell out how each goal will be achieved. The ■ plans might also include a list of resources, contacts of people who can help the employee achieve the goals, and timetables for following up to ensure they are met.
End the review on a positive note by highlighting how both the employee and firm ■ will excel if the goals are achieved.

follow up day to day
As you have learned, feedback is most useful when it is immediate and specific to a particular situation. Unfortunately, both managers and employees are frequently happy to finish the interview and file away the appraisal form. A better approach is to have informal talks periodically, perhaps quarterly, to follow up on the issues raised in the appraisal interview. Levi Strauss, for example, offers employees informal feedback and coaching sessions on an ongoing basis. This puts managers in more of a coaching role versus that of a judge.
improving performance
In many instances, the appraisal interview will provide the basis for noting defi-ciencies in employee performance and for making plans for improvement. Unless these deficiencies are brought to the employee’s attention, they are likely to con-tinue until they become quite serious. Sometimes underperformers do not under-stand exactly what is expected of them. However, once their responsibilities are clarified, they are in a position to take the corrective action needed to improve their performance.
Identifying Sources of Ineffective Performance
y concerns: ability, motivation, and environment. Each indi-vidual has a unique pattern of strengths and weaknesses that play a part. But tal-ented employees with low motivation are not likely to succeed. In addition, other factors in the work environment—or even in the external environment, which in-cludes personal, family, and community concerns—can affect a person’s perfor-mance either positively or negatively. Figure 8.9 provides a better picture of how these three factors (ability, motivation, and environment) can influence people’s performance.
• Technical skills• Interpersonal skills• Problem-solving skills• Analytical skills• Communication skills• Physical limitations
• Career ambition• Goals and epectations• Job satisfaction and frustrations • Fairness perceptions• Relations with coworkers
• Equipment/materials• Job design• Economic conditions• Unions• Rules and policies• Managerial support• Laws and regulations

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