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Flashcards in Chapter 9 Deck (74)
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1
Q

Performance management

A

The process of managing two related activities:

  1. Evaluating the performance of your employees against the standards set for them.
  2. Helping them develop action plans to improve their performance. Our goal is to motivate employees to work hard and continually improve what they do.
2
Q

Administrative Purposes - “Documentation”

A
  • Performance management is a tool for administrative decisions such as: compensation, promotions, lateral movements (transfers), demotions, retention/termination, layoffs, and recognition.
  • We utilize this performance management results to discipline employees as well.
3
Q

Developmental Purposes - “Develop”

A

Performance management is a tool to help employees improve their weaknesses and realize their long-term goals and career objectives.

  • How to add more to the competitive advantage of the organization?
  • Helps in identifying training needs.
  • Helps in identifying the employee potential and the course of actions to achieve it.
4
Q

Global performance measure

A

a single score to reflect an individual employee’s overall performance

5
Q

Performance dimensions

A
  • are different areas that are being evaluated; should reflect the reasons the job exists (tasks, duties, responsibilities).
  • Jobs consist of multiple performance dimensions, thus if you do not break their performance down, you won’t be able to identify the areas to improve
6
Q

Deficient performance measure

A
  • An incomplete appraisal of an individual’s performance when important measures are not measured.
  • Fail to measure an additional important parts of the job, while focusing on others
7
Q

Contaminated performance measures

A

A performance measure that is irrelevant to an individual’s actual job performance.

8
Q

Performance Measure Standards

A

Levels of expected performance that relate to levels of task or job effectiveness

9
Q

How can you compare results if you do not have a standard or benchmark to compare results to?

A
  • Standards could be Quantitative such as Sales, Number of Errors, Quantity of Output.
  • Standards could also be Qualitative such assessing if a task was completed successfully ( such as using measures such as Yes or NO / Utilizing a five points scale from Unsatisfactory to Excellent)
  • Standards should be both Challenging and Achievable to ensure fairness and motivation.
10
Q

Specificity

A
  • The clarity of the performance standards
  • Specific measures makes it clearer for managers to evaluate, thus achieving consistency.
  • Specific measures help employees understand how different aspects of the job should be performed.
  • Specific in identifying measures for various tasks, rather than overall performance.
11
Q

Ranking approach

A
  • An evaluation approach which employees are evaluated from best to worst along some performance dimension or by virtue of their overall performance.
  • Ranking is easier when comparing employees based on quantitative data.
12
Q

Paired comparison

A

An evaluation approach in which each employee in a business unit is compared to every other employee in the unit.

13
Q

Forced distribution

A
  • A form of individual comparisons whereby managers are forced to distribute employees into one of several predetermined categories.
  • It forces managers to be more critical in assessing employees.
14
Q

What are the advantages of individual comparisons?

A
  • Easy approaches to design and implement

- Results could be used for administrative purposes (who to promote or choose for layoff?).

15
Q

What are disadvantages of individual comparisons?

A
  • Ranking and paired comparisons are complicated when the business unit is large.
  • It requires a lot of information, time and effort, with limited accuracy as managers might not be able to distinct each individual performance.
  • Comparative approaches are not useful for developmental purposes. Often it fails to capture why employees are performing at a certain level.
16
Q

Absolute Approaches

A
  • The evaluation of employees’ by comparing employees against certain “Absolute” standard (rather than against each other) along a number of performance dimensions (rather than simply making a global assessment about them).
  • Each employee’s evaluation is independent of others in the workgroup, and might focus on the employee attributes, behaviors or/and results.
17
Q

Attribute-based Approach

A
  • A method of evaluating employees based on various traits or attributes that they possess relevant to their performance.
  • Designed to measure the extent to which an employee possess certain characteristics – such as loyalty, dependability, creativity, initiative, and leadership – that are viewed as important for the job and the organization in general
18
Q

Graphic Rating Scale (Attribute-based approach)

A
  • raters use a 3, 5, 7 or 10 points scale to assess the attributes
  • This approach is highly useful for developmental purposes as it breaks performance into number of attributes.
  • Scales might be designed poorly, ambiguous, and the standards might be interpreted differently by raters.
19
Q

Behavior- based Approaches

A
  • Some attributes reflect truly the employee performance.
  • Yet, attributes usually predict the person’s potential to perform well rather than his or her actual performance
  • Therefore, an alternative to attribute-based assessments is behavioral-based approaches that emphasize examining the extent to which employees actually display certain behaviors on the job.
20
Q

What are examples of behavior-based approaches?

A
  • Critical Incident Approach
  • Forced-Choice Approach
  • Behaviorally Anchored Rating Scales (BARS)
  • Behavior Observation Scales (BOS)
21
Q

Critical Incident Approach

A
  • A behavior-based evaluation approach where the evaluation criteria consist of statements or examples of exceptionally good or poor performance employees display over the course of the evaluation period.
  • Focus on Actual Behaviors rather than traits
  • To be effective mangers need to keep track of employee behaviors
22
Q

Forced-Choice Approach

A
  • A behavior-based evaluation approach where managers must choose from a set of alternative statements regarding the person being rated.
  • The statements that are viewed “higher” might not be known by the rater – in order to force the rater to choose the most accurate statement.
  • Each statement has a predetermined value, based on the priorities of the organization
23
Q

Behaviorally Anchored Rating Scales

A
  • A behavior-based evaluation approach where raters must evaluate individuals along a number of performance dimensions with each performance rating standard anchored by a behavioral example.
  • It integrates the benefits of the critical incident approach and the graphic rating scales.
  • It provides raters with a frame of reference for evaluating each performance dimension, possibly achieving higher consistency.
  • It requires a lot of time and effort to develop.
    BARS are usually job specific, thus they are ineffective to use them across jobs.
24
Q

Behavior Observation Scales

A
  • A behavior-based evaluation approach that requires raters to evaluate how often an employee display certain behaviors on the job.
  • The primary difference from BARS is that it details various behaviors (or job elements) for each performance dimension and assess the frequency of each.
25
Q

Direct Measures Approach (Results-Based Approach)

A
  • managers gauge outcomes of employees’ work such as sales, productivity, absenteeism.
  • When the right measures are evaluated, it is very clear and meaningful.
  • Not all jobs are associated with objective outcome measures.
  • Focusing only on certain outcomes might lead to neglecting other outcomes
26
Q

Management-by-objectives (Results-Based Approach)

A
  • managers meet with employees and jointly set goals for them to accomplish during particular time period.
  • At the end of the period, they meet again to evaluate whether the employee met or exceeded the objectives or whether they failed.
  • Potentially problematic when most objectives are not quantifiable.
  • Beware of narrow goals, as they might cause the employee to neglect other aspects of the job that are not being evaluated.
27
Q

Supervisors

A
  • a key source but may not have time to monitor and observe employees every day, or simply managers might not work in close proximity.
  • Limited observation capacity, thus does not necessarily represent the full picture of the employee’s performance.
  • Source of Performance Data
28
Q

Co-Workers

A
  • may be able to comment on cooperation and support, but may intentionally skew rating.
  • Their feedback is especially useful when the employee is part of a team and their work is interrelated.
  • They might have more realistic overview of the job
  • Beware of interpersonal relationships (like – dislike)
  • Source of Performance Data
29
Q

Self-Appraisal

A
  • can be useful starting point and developmental tool to help employee improve performance.
  • Employees might tend to inflate their evaluations, especially if data is used for administrative purposes.
  • Source of Performance Data
30
Q

Subordinates

A
  • May be hard to separate skill from “likeability”
  • Fear from retaliation ( even when the raters are anonymous, the manager might deduce who rated him negatively if the subordinates are few in number).
  • Managers might tend to prioritize the satisfaction of his employees over organizational goals.
  • Source of Performance Data
31
Q

Customers

A
  • Good source of data as customers are the critical determinant to company’s success.
  • Data might not be equally relevant for all jobs.
  • Might be expensive and time-consuming to reach out to all customers.
  • Satisfaction levels may only report extremely good or bad experiences.
  • Try to ensure a representative sample
  • Source of Performance Data
32
Q

Multi-Source or 360-degrees Appraisal

A
  • A comprehensive measurement approach that involves gathering performance data from as many sources as possible.
  • Comprehensive, thus potentially more accurate.
  • Yet, complex, time-consuming to collect data and analyze it.
  • Different raters might have different exposures to employees, thus potential inconsistencies.
33
Q

Weighting Performance Criteria

A
  • Each job differs in terms of how it adds value to the organization
  • Some forms of contributions may be more important than others for particular jobs
  • Weights are used to adjust the relative importance of different performance dimensions
34
Q

Halo/horn error (Performance Measurement Error)

A

overall positive or negative view of employee’s performance biases the ratings given on individual criteria

35
Q

Contrast effect (Performance Measurement Error)

A

manager artificially inflates or deflates an employee’s rating after comparing employee to another individual

36
Q

Primacy error (Performance Measurement Error)

A

rater’s earlier impressions of individual biases later evaluations of the person

37
Q

Recency error (Performance Measurement Error)

A

rater focuses on employee’s performance near the time of the evaluation

38
Q

Similar-to-me error (Performance Measurement Error)

A

when managers rate more highly employees who resemble them in some way

39
Q

Leniency error (Performance Measurement Error)

A

constantly rating employees on the high end of the scale

40
Q

Strictness error (Performance Measurement Error)

A

constantly rating employees on the low end of the scale

41
Q

Error of central tendency (Performance Measurement Error)

A

rating everyone “average”

42
Q

Steps to reduce measurement errors

A
  • Make rating formats more specific, defining precisely what is being evaluated
  • Use multiple raters when possible to attain inter-rater reliability.
  • Provide appraisal training — to familiarize raters with errors that can occur.
  • Provide frame-of-reference training — to help raters understand performance standards and dimensions and develop common evaluation standards
  • It is useful to communicate the frame-of-reference to employees as well.
43
Q

Providing Feedback

A
  • In an ideal situation, performance feedback should be provided on an ongoing basis.
  • As a manager, try to provide feedback on critical incidents immediately.
  • Not providing immediate feedback will implicitly signal that the employee performance is satisfactory.
  • Feedback meeting on performance could be separate from meeting on salary decisions.
44
Q

What three steps does continuous performance appraisal feedback include?

A
  • Preparation: gathering information from relevant sources, including the ones being assessed and their performance challenges and deficiencies.
  • Communication: conducting the performance appraisal meeting.
  • Follow through : following up on what is communicated in order to make sure the points are addressed
45
Q

Balanced approach (providing feedback)

A
  • positive and improvement areas.
  • Involve/engage employee in discussion in order to increase
    Self-reflection
    Signal improvement
    Discuss factors that might have influenced their performance
46
Q

Understanding the Causes of Poor Performance

A
  • Seek to understand causes of poor performance, which could stem from:

+ Lacking certain competencies; Knowledge, Skills, Abilities
+ Inadequate working environment that they cannot control
+ Error in Job Design
+ Inadequate Technology
+ Lack of support from coworkers
+ Poor performance of co-workers

47
Q

What are ways to take action to improve perfomrance?

A
  • Removing barriers to employee success
  • Training and development activities to address skill deficiencies
  • Coaching and mentoring
  • Work design and technology solutions
  • The qualification and performance of coworkers
  • Addressing quality of employee’s performance
48
Q

Performance Improvement Plan

A
  • a tool to monitor and measure an employee’s deficient work products, processes, and/or behaviors to improve performance or modify behavior.

It should be constructive and clear in communicating:

  • How the inadequate performance determination was made
  • What corrective and/or disciplinary actions will be taken
  • By whom and when
  • When and how the individual performance will be reviewed
49
Q

What does the acronym FOSA+ stand for?

A

F - facts that define the problem, including the company’s expectations
O - Objectives that help the employee understand how to resolve the problem
S - Solutions that can help the employee strategize how to reach the objectives
A - Actions that will be taken if the problem is not corrected
+ - Plus your overall efforts and support to help the employee succeed

50
Q

Progressive Discipline

A
  • a process by which an employee with disciplinary problems progresses through a series of disciplinary stages until the problem is corrected.

Step 1; Verbal warning: stating that the behavior or performance is not acceptable.
Step 2; Written warning: letter or form specifying the problem history, the employee’s explanation, the company expectations for change, and the consequences if improvement is not met within a specific time frame.
Step 3; Suspension without pay: suspending the employee for a week, three days…etc. with a final warning.
Step 4; Termination: last step when previous ones were not effective. Based on consideration and discussions with the employee.

51
Q

Positive discipline

A

A disciplinary process that is not punitive but focuses on constructive feedback and encourages employees to take responsibility for trying to improve their behaviors or performance at work.

52
Q

Counseling

A
  • bringing a problem to the employee’s attention before it becomes serious enough to require a written warning.
  • The key to positive discipline is to help employees identify their problems early on and address the causes of their problematic behavior.
53
Q

Which performance dimensions are emphasized

Organizational Demands: Strategy

A
  • The importance of performance dimensions will vary based on the strategy of the firm.
  • Accordingly, the more important performance dimension is given a higher weight.
  • For example, in a low-cost strategy, the sales figure might have a higher weight; while in a customer-service strategy, customer satisfaction might have a higher weight.
54
Q

The performance evaluation method used

Organizational Demands: Strategy

A
  • In a low cost strategy, organizations might tend to emphasize comparative approaches, focusing on maximum efficiency.
  • Also, they tend to utilize cheaper methods to design and implement.
  • In a differentiation approach, absolute methods might be utilized more, where some organization might be willing to spend more on the design and implementation of PM.
55
Q

Which performance evaluation approach is used

Organizational Demands: Company Characteristics

A
  • The organizational size affect the feasibility of using various PM approaches.
  • Individual comparisons are easier to utilize in smaller organizations as managers can observe few employees’ behaviors. This is not possible when managing many employees at bigger organizations.
  • Developing absolute PM systems are often time-consuming and expensive, thus mostly applicable at bigger organizations.
56
Q

Who carries out the process

Organizational Demands: Company Characteristics

A
  • Smaller organizations depend on line managers to design and implement PM systems due to the lack of support functions.
  • At bigger organizations, they have more HR specialists that can work on the design of PM systems and take care of its administration, yet still managers are expected to contribute to the design and implementation.
57
Q

The objective of the performance management system

Organizational Demands: Culture

A
  • Within a competitive culture, the focus of PM is on administrative purposes.
  • Within a culture that values long-term employability and employee wellness, the organization tend to focus on developmental purposes.
58
Q

Which evaluation approach is used

Organizational Demands: Culture

A
  • A comparative approach is utilized to increase competition.
  • Absolute approaches is utilized to increase employee welfare and loyalty.
  • Moreover, if an organization focuses only on results, they might push employees to compete.
  • Many organizations focus on how results are achieved, thus highlighting the importance of quality improvement.
59
Q

Effectiveness of performance management approaches

Organizational Demands: Culture

A
  • Make sure that performance management approaches matches the culture to maximize receptivity and reinforcement.
60
Q

Perceptions of procedural and distributive justice

Organizational Demands: Employee Concerns

A
  • Are employees perceiving the PM results as fair in reflecting their true performance? Does the PM system have a good rationale and provide clear directions on how to improve?
  • Is the PM system design fair and unbiased? Are the measures Deficient, Contaminated, or Unachievable? Were the measures communicated well? Were the raters in a good position to evaluate them? Was the feedback constructive?
61
Q

Employees’ responsiveness to performance feedback

Organizational Demands: Employee Concerns

A
  • At many instances, managers need to rely on PM for administrative purposes.
  • Yet, employees want to focus on feedback and development.
62
Q

Achieving work/life balance

Organizational Demands: Employee Concerns

A
  • PM can support or conflict with work/life balance initiatives.
  • Telecommute and flexible hours might affect how raters evaluate employees, especially that they have limited capability to observe behaviors.
63
Q

Accuracy of performance evaluations

Environmental Influences: Labor Market

A

Given that many organizations might depend on subjective approaches, the increasing diversity of the workforce might increase direct and indirect discrimination.

64
Q

The need to evaluate diversity efforts

Environmental Influences: Labor Market

A
  • Managers should be held accountable for diversity initiatives.
  • For example, they can be evaluated on their ability to develop employees from diverse backgrounds.
65
Q

The performance management process

Environmental Influences: Technology

A
  • Companies are capable of monitoring performance utilizing various technologies.
  • Data also can be collected from various sources electronically.
  • Technology might also be utilized to provide instant feedback to track their progress.
66
Q

How telecommuters are evaluated

Environmental Influences: Technology

A

Usually managers focus on outputs (results) rather than behaviors.

67
Q

What is evaluated

Environmental Influences: Globalization

A
  • The performance dimensions effective at one location might not be effective at others.
  • For example, what is achievable in one week at one location might need 3 months to be achieved at another.
68
Q

The acceptability of the performance management system

Environmental Influences: Globalization

A
  • Individualistic vs. collectivists cultures
  • For international assignees, they might need to apply different mechanisms to succeed at various locations, thus the need to have different performance dimensions, standards and employee perceptions.
69
Q

Who provides performance data

Environmental Influences: Globalization

A
  • Home country manager: more knowledgeable of the international assignee previous performance and culture, but incapable of observing the IA behavior and might not appreciate customization.
  • Host country manager: might not consider the IA’s cultural background, pressure the IA for customization, yet more capable of observing the IA’s behavior.
70
Q

Employees’ perceptions of the performance management system

Environmental Influences: Ethics

A
  • Ensure that the PM system is ethical.
  • The importance of distributive and procedural justice, in addition to offering the employee voice throughout the process.
71
Q

How employees react to surveillance and monitoring

Environmental Influences: Ethics

A
  • Technological advances allow us to monitor employee performance, yet it raised the issue of employee privacy.
  • Are we allowed to monitor emails and phone calls? Do managers trust employees? Aren’t they invasive?
72
Q

How ethically employees behave at work

Environmental Influences: Ethics

A
  • PM might foster an ethical or unethical behaviors.
  • A system that focuses on individual comparisons and/or financial results might foster unethical behaviors.
  • Also, this is true for systems that focus on administrative purposes
73
Q

Efforts to reduce discrimination in the performance management process
(Regulatory Issues)

A
  • Beware of forced distribution, it had caused a lot of litigations before.
  • Beware of direct or indirect discrimination.
  • Evaluating employees on outputs is more objective and defensible.
  • Be detailed when utilizing BARS and BOS and train raters well.
  • Measures should be job-related, valid, reliable, specific and clear.
74
Q

The importance of documenting employee performance

Regulatory Issues

A
  • You need to document all of the evidence that supports the PM results.
  • This minimizes bias, such as recency effect.
  • Document all discussions, steps taken for improvement and disciplinary actions with accurate timeline.