HRM - Performance Management
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The document outlines the definition, purpose, and process of performance management, emphasizing a systematic approach to evaluating and developing employee performance while aligning individual goals with organizational objectives. Key components include setting S.M.A.R.T. goals, continuous feedback, various performance appraisal techniques, and addressing common issues in performance evaluations. Ultimately, it stresses the importance of structured processes and training to enhance employee performance and align it with the company's mission.
HRM - Performance Management
- 2. Definition and Purpose of Performance Management Performance Management Model Performance Management Process KRAs and KPIs Performance Appraisal Rating How to source information for Performance Management PART I Luigi
- 3. DEFINITION OF PERFORMANCE MANAGEMENT A tool that helps managers monitor and evaluate employees’ work. A continuous process of communication and clarifying job responsibilities between the manager and employee. Helps managers and employees talk face-to-face about expectations, goals, and career progress, especially on how one’s work aligns with the company’s overall vision. Periodic, systematic, and objective process of developing an employee to perform their job to the best of their ability. (Tardi, 2023)
- 4. - COMMON STEPS IN PERFORMANCE MANAGEMENT Aligning employees’ activity with the company’s mission and goals Developing specific job-performance outcomes Creating measurable performance-based expectations Defining job-development plans Meeting regularly (Tardi, 2023)
- 5. - PURPOSE OF PERFORMANCE MANAGEMENT Strategic Purpose aligns employees with overall organizational strategy to maximize potential Developmental Purpose develop employees who are efficient at their work and improve performance of employees who are not performing well Administrative Purpose the use of rewards system based on the information provided by the performance management (performance recognition) (MBA Knowledge Base, nd.)
- 6. Serves as a guide for management and employees to better achieve organizational goals via a structured process. MODEL (Andreev, 2023)
- 7. PLANNING Groundwork for success is laid down Collaborative process Outlined Where management team meet and discuss organization’s goals and objectives for the year. Goals should be clearly outlined using S.M.A.R.T. Specific: goals are outlined and clear steps on how to achieve goals are set Measurable: Definite and measurable indicator to tell if goals can be achieved Achievable: Goals should be realistically achievable Relevant: Goals should be in lined with employees’ work and overall goals of the organization Time-bound: Definite timeline of when the goal should be completed.
- 8. MONITORING Monitors the performance/status of the set goal Should be done monthly/quarterly to keep track on the progress of the team Helps maintain the motivation of the employees in doing their work Serves as a guidance for the employees
- 9. REVIEWING Done at the end of the year if goals set in the previous year were met Builds collaboration with the employees - more involved they are, the more motivated they will be to work better Chance for the management to evaluate the process and final results of their goals. Employees can present their perspectives about the project and receive feedback from superiors regarding their performance
- 10. REWARDING Final step in the process A way to motivate the employees to work harder Important step - recognizes the hard-work of the employees Examples of rewards that are offered: Increase in compensation One-time bonus Increased vacation time Special projects Promotion Positive review Company-wide acknowledgment
- 11. PROCESS OF PERFORMANCE MANAGEMENT (Build an Effective Performance Management Process in 5 Steps, 2021) (Noe et. al., 2016)
- 12. PROCESS OF PERFORMANCE MANAGEMENT Performance Plan Creation of detailed plan on how to achieve goals/objectives. Employees are to be involved in this process. Performance Management Goals Members of the team should work together to come up with S.M.A.R.T. goals. Build a Performance Review System System will help in evaluating the work of the employees. Feedback from manager to employee. Develop Strong Feedback Giving Skills Process of balancing pushing employees to perfection and keeping them motivated (feedack). Ongoing Employee Performance Management Keeping up with progress of employees, giving instant feedback, formal meetings, and corrective measures on mistakes done.
- 13. Set of goals and objectives that organizations assign to their employees to accomplish a job. Helps employees direct their efforts toward achieving goals. Requires excellent performance from employees. KRA KRA VS KPI Measures the employees’ efforts and suggest improvements. Essential in evaluating employees’ performance on their duties/accomplishment of KRAs. Helps management understand employees’ contribution to the organization. KPI (Bojamma, 2023)
- 14. PERFORMANCE APPRAISAL RATING Manages the employee performance process in an organization to evaluate the job performance of a team. Captures qualitative and quantitative feedback and turning them into actionable insights. insights can improve quality of the team and output. (5 Essential Feautres of an Effective Performance Appraisal System, 2023)
- 15. TYPES OF PERFORMANCE APPRAISAL RATINGS Self-evaluation Employees conduct their performance assessment on their own against a list of criteria. Behavioral checklist Yes or No checklist against a series of traits. Supervisors are to tick if the employees meet those traits. 360-Degree feedback Review includes both direct feedback from the manager and employee, and from other team members. Review also includes character and leadership capabilities. Rating scale Uses a set of pre-determined criteria to evaluate an employee. A score can be calculated at the end. Management by objectives Agreement between employee and manager wherein the employee agrees to a set of attainable performance goals to be achieved. (Andreev, 2023)
- 16. most used source have extensive knowledge on job requirements to observe an employee Supervisors/Managers SOURCE OF INFORMATION (GreggU, 2022)
- 17. can be a good source of information when it comes to performance in a job have observation on the employee Peers/Coworkers SOURCE OF INFORMATION (GreggU, 2022)
- 18. best source of information in evaluating managers. have best chance to see how well a manager treats employees Subordinates SOURCE OF INFORMATION (GreggU, 2022)
- 19. can contribute valuable information rarely used alone employees evaluate their own performance Self-Rating SOURCE OF INFORMATION (GreggU, 2022)
- 20. customers are often best source of performance information via feedback forms/evaluation forms Customers SOURCE OF INFORMATION (GreggU, 2022)
- 21. organizations combine information from numerous sources. 360-Degree SOURCE OF INFORMATION (GreggU, 2022)
- 22. Approaches to Measuring Performance and Criteria for Rating Comparative Attribute Behavioral Result PART II Ale
- 23. involves comparing an employee's performance against other members of the group in order to rate them. The best and worst performer set the standards for the group. COMPARATIVE
- 24. Involves comparing an employee's performance against other members of the group in order to rate them. The best and worst performer set the standards for the group. The are three techniques that fall under this approach being Force Distribution, Paired Comparison, and Ranking. COMPARATIVE
- 25. The format where employees are ranked into groups It is best utilized when rating the performance of a large sample of employees. FORCE DISTRIBUTION Comparative Approach
- 26. Increase productivity Identify key employees and encourage competition Employees are divided into groups HR and Managers can target low performers Advantages FORCE DISTRIBUTION Advantages and Disadvantages Does not depend on results achieved but the visibility of the employee Teamwork can be negatively impacted by ranking Encourages unhealthy competition Disadvantages
- 27. The comparison of every employee to other employees in a set for a specified category of skill, When the employee exhibits better performance, a point is given PAIRED COMPARISON Comparative Approach
- 28. Easy to calculate Helpful when there is no objective data to depend upon Advantages PAIRED COMPARISON Advantages and Disadvantages Comparison is objective and is not job specific Time consuming Does not evaluate individuality of the employee Disadvantages
- 29. Employees are ranked from the top performer to the worst in their respective departments Requires employees to be ranked on overall performance RANKING Comparative Approach
- 30. Ranking employees from best to worst on a particular trait, choosing highest and lowest. It is easier to distinguish between the worst and best employees ALTERNATION RANKING METHOD
- 31. Identifies the top Performer Able to identify the worst performer in the team Advantages RANKING Advantages and Disadvantages Favors competition as members are ranked High stress for employees on the lower ranks Not applicable for larger companies Disadvantages
- 32. Employees are rated on a basis of specific set of parameters: Problem solving skills Teamwork / Communication Judgement / Creativity Innovation ATTRIBUTE
- 33. List skills, competencies and results which is then evaluated by a number in a point rating scale where the manager rates the employee one at a time Forms are prepared for each employee GRAPHIC RATING SCALE Attribute Approach
- 34. Straightforward and easy to understand Quantifies behavioral traits Advantages GRAPHIC RATING SCALE Advantages and Disadvantages Each scorer have a different perception on the employee being scored Exceptional strengths can overshadow glaring weakness Disadvantages
- 35. One of the oldest performance measurement techniques Defines the behavior of an employee must exhibit to be effective at the job Can be done using B.A.R.S or B.O.S techniques BEHAVIORAL
- 36. A measuring system which rates the employees according to their performance and specific behavioral patterns Offers both quantitative and qualitative data Scale that use behavior “statements” as reference points Measures an employee's performance against specific sample of behaviours that are given number rating for the purpose of collecting data BARS (BEHAVIORALLY ANCHORED RATING SYSTEM)
- 37. Easy to use and it is clear It is based on Behavior - The employee appraisals goal is to improve performance. Having a better understanding of behaviors allows the company a perspective to what works and what does not work It’s Impartial - Heavily focus on behavior. The evaluation process has more fairness to it Completely individualize - Unique performance management experience for every position within an organization. BARS (BEHAVIORALLY ANCHORED RATING SYSTEM) Benefits of using
- 38. Time Consuming - Designing a unique evaluation for each job roles would need the organization to invest an enormous amount of time Management demanding - Managers would have to be highly involved in procuring the statements and anchors for the unique appraisals BARS (BEHAVIORALLY ANCHORED RATING SYSTEM) Downsides of using
- 39. Measures behaviors that you want the employee to achieve Rates the employees on a scale Varies from BARS but almost similar. On BARS it specifies behaviors for each level of performance. It can be more accurate but more tailored for the job B.O.S (BEHAVIORAL OBSERVATION SCALE
- 40. Suitable for assessing the performance of employees whose jobs cannot be evaluated based on productivity alone Time efficient compared to BARS it takes less time to develop Possible to compare different employees B.O.S APPROACH Benefits of using
- 41. Difficult to keep track of employee behavior within larger teams It might lack details compared to BARS Subjective which can result in unfair result B.O.S APPROACH Disadvantages of using
- 42. Before they leave the store Within 2 minutes entering the store Immediately upon entering the store Immediately and with a smile Immediately with a smile and sincerely offering help Bars 1. 2. 3. 4. 5. BARS AND BOS Side by side comparison of Almost Seldom Sometimes Often Almost Always Bos 1. 2. 3. 4. 5.
- 43. Emphasizes the outcomes produced by the employees Not concerned about employee behavior and processes Measuring results usually takes lesser time than measuring behavior needed to achieve results Can be measured by Balance Score Card or Management By Objectives RESULT
- 44. System that provides feedback on both internal processes and external outcomes to improve strategic performance and results. Tool that views organization from different perspectives Financial - Perspective of shareholders Customer - What customers perceive and experience Business Process - Key processes to meet and exceed customer and shareholder requirements Learning and Growth - Continuous improvement BALANCE SCORE CARD
- 45. Brings structure to business strategy Middle ground for each department to talk about strategy and progress within the organization Ensure organizational alignment Drive focus on key requirements Advantages BALANCE SCORE CARD Advantages and Disadvantages Customize to every organization Requires a lot of data Disadvantages
- 46. Aligns team members goals with company objectives Process where the goals of the organization are defined and conveyed by the management to members of the organization with the intention to achieve each objective MANAGEMENT BY OBJECTIVES
- 47. Help employees appreciate their on the job roles Better teamwork and communication Provides employees with clear understanding of what is expected from them Advantages MANAGEMENT BY OBJECTIVES Advantages and Disadvantages More emphasis given to goals and targets Sometimes over emphasizing the target goal compared to operational issues Disadvantages
- 48. Provides metrics and feedback on how the goals are being achieved, how business is performing and how business can improve Strategic quadrants that helps focus on what was achieve and what needs to be achieve Balanced score card 1. 2. BALANCED SCORE CARD AND MANAGEMENT BY OBJECTIVES Side by side comparison of Creates goals and objectives at the highest level of hierarchy then passing these goals downstream Provides the direction needed around the goals objectives around the organization Management by objectives 1. 2.
- 49. Performance Appraisal Rater/Judgement Errors Performance Feedback Diagnosing Poor Performance Managing Employee Perf Conclusion (Things to Consider) PART III Anton
- 50. Refers to the regular review of an employee's job performance and overall contribution to a company. Also known as an annual review, performance review or evaluation, or employee appraisal. A performance appraisal evaluates an employee’s skills, achievements, and growth, or lack thereof (Hayes, 2021) PERFORMANCE APPRAISAL
- 51. Companies use performance appraisals to give employees big-picture feedback on their work and to justify pay increases and bonuses, as well as termination decisions. They can be conducted at any given time but tend to be annual, semi-annual, or quarterly. (Hayes, 2021) PERFORMANCE APPRAISAL
- 52. (Florendo et al., 2022) PERFORMANCE APPRAISAL VS. PERFORMANCE MANAGEMENT
- 53. Inappropriate Methods and Forms Ineffective Implementation of Performance Appraisal Lack of Rater Training/Preparedness Difference Among Raters Rater/Judgement Errors (Florendo et al. 2022) COMMON ISSUES WHEN DOING PERFORMANCE MANAGEMENT
- 54. Forms or scorecards used can be vague Metrics might not measure what really matters in a job Perspective issues Lack of sincerity Lack of follow-throughs following the appraisal Inappropriate Methods and Forms Ineffective Implementation of Performance Appraisal COMMON ISSUES WHEN DOING PERFORMANCE MANAGEMENT
- 55. Rater / judge might not be trained on how to conduct appraisals or use the metric instrument Rater will evaluate an employee he/she doesn’t even know in the first place. Kinda like your professors in college, some raters can be “harsh” while others “soft” or “easy” Personal bias and prejudice Lack of Rater Training/Preparedness Difference Among Raters Rater / Judge Errors COMMON ISSUES WHEN DOING PERFORMANCE MANAGEMENT
- 56. Rater/Judgment Errors are errors in that occur in a systematic manner when an individual observes and evaluates another (Willamette University, n.d.) RATER / JUDGE ERRORS ”the majority of human decisions are based on prejudice, beliefs, and intuition. Not based on facts or logic” - Daniel Kahneman (Nobel Prize Winner) Once we understand how these errors happen, we can prevent them. Why does it matter?
- 57. EXAMPLE ERRORS (Florendo et al., 2022)
- 58. It is a manger’s responsibility to provide specific feedback to employees and elicit positive responses (Hayes, 2021) Feedback should be given frequently, not just once a year More frequent feedback = better performance PERFORMANCE FEEDBACK
- 59. Ask employees to rate their performance before the session. Encourage the subordinate to participate in the session. “Tell and listen” and “problem solver” approach Recognize and acknowledge great performance TIPS ON DELIVERING PERFORMANCE FEEDBACK
- 60. Focus feedback on behaviour or results, not on the person. Minimize criticism Agree to specific goals and set a date to review progress Always allow the employee to be part of the feedback process BE KIND TIPS ON DELIVERING PERFORMANCE FEEDBACK
- 61. We must make an accurate diagnosis of the cause of a poor performance to help us choose an appropriate action and solve the problem effectively. Marginal employees are those employees who are performing at a bare minimum level because of a lack of ability and/or motivation to perform well (Florendo et al. 2022) DIAGNOSING POOR PERFORMANCE
- 62. Does the employee recognize what he or she is supposed to do? Are the job flow and procedure logical? Does the employee have the resources needed for successful performance? Are other job demands interfering with good performance in this area? INPUT (Florendo et al. 2022) CONSIDER THIS!
- 63. Does the employee have the necessary skills and knowledge needed? Does the employee know why the desired performance level is important? Is the employee mentally, physically, and emotionally able to perform at the expected level? EMPLOYEE CHARACTERISTICS (Florendo et al. 2022) CONSIDER THIS!
- 64. Has the employee been given information about his or her performance? Is performance feedback relevant, timely, accurate, specific and understandable? Do performance standards exist? Does the employee know the desired level of expected performance? Does the employee believe he or she can reach the performance standard? FEEDBACK PERFORMANCE STANDARD/GOALS (Florendo et al. 2022) CONSIDER THIS!
- 65. Are consequences (rewards, incentives) aligned with good performance? Are the consequences of performance valuable to the employee? Are performance consequences given in timely manner? Do work group or team norms encourage the employee not to meet performance standards? CONSEQUENCES (Florendo et al. 2022) CONSIDER THIS!
- 66. A super helpful framework on how to manage your employees (Gardner, 2021) Allows you to quickly determine whether to Delegate tasks to, Guide, or Direct and employee THE SKILL - WILL MATRIX
- 67. The system should be developed by conducting a valid job analysis that ascertains the important aspects of job performance. The system should be based on either behaviours or results; evaluations of ambiguous traits should be avoided. Raters should be trained in how to use the system rather than simply given the materials and left to interpret how to conduct the appraisal. (Florendo et al. 2022) CONCLUSIONS AND THINGS TO CONSIDER ABOUT PERFORMANCE MANAGEMENT SYSTEMS
- 68. There should be some form of review by upper-level managers of all the performance ratings, and there should be a system for employees to appeal what they consider to be an unfair evaluation. The organization should provide some form of performance counselling or corrective guidance to help poor performers improve their performance before being dismissed (Florendo et al. 2022) CONCLUSIONS AND THINGS TO CONSIDER ABOUT PERFORMANCE MANAGEMENT SYSTEMS
- 69. Multiple raters should be used, particularly if an employee’s performance is unlikely to be seen by only one rating source such as manager or customer. Performance evaluations need to be documented. (Florendo et al. 2022) CONCLUSIONS AND THINGS TO CONSIDER ABOUT PERFORMANCE MANAGEMENT SYSTEMS