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© 2005 Prentice Hall Inc. All rights reserved. PowerPoint Presentation by Charlie Cook The University of West Alabama t e n t h e d i t i o n Gary Dessler Chapter 9 Part 3 Training and Development Performance Management and Appraisal
After studying this chapter, you should be able to: 1. Describe the appraisal process. 2. Develop, evaluate, and administer at least four performance appraisal tools. 3. Explain and illustrate the problems to avoid in appraising performance. 4. List and discuss the pros and cons of six appraisal methods. 5. Perform an effective appraisal interview. 6. Discuss the pros and cons of using different raters to appraise a persons performance. 1. Describe the appraisal process. 2. Develop, evaluate, and administer at least four performance appraisal tools. 3. Explain and illustrate the problems to avoid in appraising performance. 4. List and discuss the pros and cons of six appraisal methods. 5. Perform an effective appraisal interview. 6. Discuss the pros and cons of using different raters to appraise a persons performance. © 2005 Prentice Hall Inc. All rights reserved. 9–2
© 2005 Prentice Hall Inc. All rights reserved.9–3 Comparing Performance Appraisal and Performance Management Performance appraisal –Evaluating an employees current and/or past performance relative to his or her performance standards. Performance management –The process employers use to make sure employees are working toward organizational goals.
© 2005 Prentice Hall Inc. All rights reserved.9–4 Why Performance Management? Increasing use by employers of performance management reflects: –The popularity of the total quality management (TQM) concepts. –The belief that traditional performance appraisals are often not just useless but counterproductive. –The necessity in todays globally competitive industrial environment for every employees efforts to focus on helping the company to achieve its strategic goals.
© 2005 Prentice Hall Inc. All rights reserved.9–5 An Introduction to Appraising Performance Why appraise performance? –Appraisals play an integral role in the employers performance management process. –Appraisals help in planning for correcting deficiencies and reinforce things done correctly. –Appraisals, in identifying employee strengths and weaknesses, are useful for career planning –Appraisals affect the employers salary raise decisions.
© 2005 Prentice Hall Inc. All rights reserved.9–6 Classroom Teaching Appraisal By Students Figure 9–1 Source: Richard I. Miller, Evaluating Faculty for Promotional and Tenure (San Francisco: Jossey-Bass Publishers, 1987), pp. 164–165. Copyright © 1987, Jossey-Bass Inc., Publishers. All rights reserved. Reprinted with permission.
© 2005 Prentice Hall Inc. All rights reserved.9–7 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 conducive to candor Hazards of giving soft appraisals –Employee loses the chance to improve before being forced to change jobs. –Lawsuits arising from dismissals involving inaccurate performance appraisals.
© 2005 Prentice Hall Inc. All rights reserved.9–8 Continuous improvement A management philosophy that requires employers 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 improve his or her own personal performance, from one appraisal period to the next.
© 2005 Prentice Hall Inc. All rights reserved.9–9 The Components of an Effective Performance 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 return Figure 9–2
© 2005 Prentice Hall Inc. All rights reserved.9–10 Defining Goals and Work Efforts Guidelines for effective goals –Assign specific goals –Assign measurable goals –Assign challenging but doable goals –Encourage participation SMART goals are: –Specific, and clearly state the desired results. –Measurable in answering how much. –Attainable, and not too tough or too easy. –Relevant to whats to be achieved. –Timely in reflecting deadlines and milestones.
© 2005 Prentice Hall Inc. All rights reserved.9–11 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.
© 2005 Prentice Hall Inc. All rights reserved.9–12 Performance Appraisal Roles (contd) HR department –Serves a policy-making and advisory role. –Provides advice and assistance regarding the appraisal tool to use. –Prepares forms and procedures and insists that all departments use them. –Responsible for training supervisors to improve their appraisal skills. –Responsible for monitoring the system to ensure that appraisal formats and criteria comply with EEO laws and are up to date.
© 2005 Prentice Hall Inc. All rights reserved.9–13 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 performance to the standards that have been set; this usually involves some type of rating form. Providing feedback –Discussing the subordinates performance and progress, and making plans for any development required.
© 2005 Prentice Hall Inc. All rights reserved.9–14 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
© 2005 Prentice Hall Inc. All rights reserved.9–15 Performance Appraisal Methods Graphic rating scale –A scale that lists a number of traits and a range of performance for each that is used to identify the score that best describes an employees level of performance for each trait.
© 2005 Prentice Hall Inc. All rights reserved.9–16 Graphic Rating Scale with Space for Comments Figure 9–3
© 2005 Prentice Hall Inc. All rights reserved.9–17 Portion of an Administrative Secretarys Sample Performance Appraisal Form Figure 9–4 Source: James Buford Jr., Bettye Burkhalter, and Grover Jacobs, Link Job Description to Performance Appraisals, Personnel Journal, June 1988, pp. 135–136.
© 2005 Prentice Hall Inc. All rights reserved.9–18 Performance Management Outline Figure 9–5a Source:
© 2005 Prentice Hall Inc. All rights reserved.9–19 Figure 9–5b Performance Management Outline (contd) Source:
© 2005 Prentice Hall Inc. All rights reserved.9–20 Performance Management Outline (contd) Figure 9–5c Source:
© 2005 Prentice Hall Inc. All rights reserved.9–21 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 and indicating which is the better employee of the pair.
© 2005 Prentice Hall Inc. All rights reserved.9–22 Alternation Ranking Scale Figure 9–6
© 2005 Prentice Hall Inc. All rights reserved.9–23 Ranking Employees by the Paired Comparison Method Figure 9–7 Note: + means better than. means worse than. For each chart, add up the number of 1s in each column to get the highest-ranked employee.
© 2005 Prentice Hall Inc. All rights reserved.9–24 Performance Appraisal Methods (contd) Forced distribution method –Similar to grading on a curve; predetermined percentages of ratees are placed in various performance categories. –Example: 15% high performers 20% high-average performers 30% average performers 20% low-average performers 15% low performers Narrative Forms
© 2005 Prentice Hall Inc. All rights reserved.9–25 Performance Appraisal Methods (contd) Behaviorally anchored rating scale (BARS) –An appraisal method that uses quantified scale with specific narrative examples of good and poor performance. Developing a BARS: –Generate critical incidents –Develop performance dimensions –Reallocate incidents –Scale the incidents –Develop a final instrument
© 2005 Prentice Hall Inc. All rights reserved.9–26 Performance Appraisal Methods (contd) Advantages of using a BARS –A more accurate gauge –Clearer standards –Feedback –Independent dimensions –Consistency
© 2005 Prentice Hall Inc. All rights reserved.9–27 Appraisal- Coaching Worksheet Figure 9–8 Source: Reprinted with permission of the publisher, HRnext.com; copyright HRnext.com, 2003.
© 2005 Prentice Hall Inc. All rights reserved.9–28 Examples of Critical Incidents for an Assistant Plant Manager Table 9–1
© 2005 Prentice Hall Inc. All rights reserved.9–29 Example of a Behaviorally Anchored Rating Scale for the Dimension Salesmanship Skill Figure 9–9 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.
© 2005 Prentice Hall Inc. All rights reserved.9–30 Management by Objectives (MBO) Involves setting specific measurable goals with 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.
© 2005 Prentice Hall Inc. All rights reserved.9–31 Computerized and Web-Based Performance 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 the amount of computerized data an employee is processing per day, and thereby his or her performance.
© 2005 Prentice Hall Inc. All rights reserved.9–32 Potential Rating Scale Appraisal Problems Unclear standards –An 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 on other traits. Central tendency –A tendency to rate all employees the same way, such as rating them all average.
© 2005 Prentice Hall Inc. All rights reserved.9–33 A Graphic Rating Scale with Unclear Standards Table 9–2 Note: For example, what exactly is meant by good, quantity of work, and so forth?
© 2005 Prentice Hall Inc. All rights reserved.9–34 Potential Rating Scale Appraisal Problems (contd) Strictness/leniency –The problem that occurs when a supervisor has a tendency to rate all subordinates either high or low. Bias –The tendency to allow individual differences such as age, race, and sex to affect the appraisal ratings employees receive.
© 2005 Prentice Hall Inc. All rights reserved.9–35 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 negative critical incidents as they occur.
© 2005 Prentice Hall Inc. All rights reserved.9–36 Who Should Do the Appraising? The immediate supervisor Peers Rating committees Self-ratings Subordinates 360-Degree feedback
© 2005 Prentice Hall Inc. All rights reserved.9–37 Advantages and Disadvantages of Appraisal Tools Table 9–3
© 2005 Prentice Hall Inc. All rights reserved.9–38 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.
© 2005 Prentice Hall Inc. All rights reserved.9–39 Performance Contract Figure 9–10 Source: David Antonion, Improving the Performance Management Process Before Discontinuing Performance Appraisals, Compensation and Benefits Review May– June 1994, p. 33, 34.
© 2005 Prentice Hall Inc. All rights reserved.9–40 Checklist During the Appraisal Interview Figure 9–11 Source: Reprinted with permission of the publisher, HRnext.com. Copyright HRnext.com, 2003.
© 2005 Prentice Hall Inc. All rights reserved.9–41 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.
© 2005 Prentice Hall Inc. All rights reserved.9–42 The Appraisal Interview (contd) 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 giving feedback on a daily basis, so that the formal review contains no surprises. –Never say the person is always wrong –Criticism should be objective and free of any personal biases on your part.
© 2005 Prentice Hall Inc. All rights reserved.9–43 The Appraisal Interview (contd) How to ensure the interview leads to improved performance –Dont make the subordinate feel threatened during the interview. –Give the subordinate the opportunity to present his or her ideas and feelings and to influence the course of the interview. –Have a helpful and constructive supervisor conduct the interview. –Offer the subordinate the necessary support for development and change.
© 2005 Prentice Hall Inc. All rights reserved.9–44 The Appraisal Interview (contd) How to handle a formal written warning –Purposes of the written warning To shake your employee out of bad habits. Help you defend your rating, both to your own boss and (if needed) to the courts. –Written warnings should: Identify standards by which employee is judged. Make clear that employee was aware of the standard. Specify deficiencies relative to the standard. Indicates employees prior opportunity for correction.
© 2005 Prentice Hall Inc. All rights reserved.9–45 Creating the Total Performance Management 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?
© 2005 Prentice Hall Inc. All rights reserved.9–46 Information Required for TRWs Web-Based Performance Management System Figure 9–12 Source: 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.
© 2005 Prentice Hall Inc. All rights reserved.9–47 Figure –13 HR Scorecard for Hotel Paris International Corporation* 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)
© 2005 Prentice Hall Inc. All rights reserved.9–48 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
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