Week-3_watermark.pdf strategic management
- 1. 1 Strategic Performance Management Week 3 Lecture11: Performance Dimensions: Task and context KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 2. Performance • PMS include measures of both behaviors (what an employee does) and results (the outcomes of an employee’s behavior). • Performance is about behavior or what employees do, not about what employees produce or the outcomes of their work. • Characteristics of Behaviour (performance)- - Evaluative-behaviors can be judged as negative, neutral, or positive -multidimensional- different kinds of behaviors having the capacity to advance (or hinder) organizational goals. KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 3. Behaviour and Results – Behaviors Are NOT always observable and measurable – Set of behaviour include Works with others within and outside the unit to improves their effectiveness; sharing information and resources; develops effective working relationships; builds consensus; and constructively manages conflict. – Results/Consequences May Be Used to infer behavior As proxy for behavioral measure 3 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 4. Determinants of Performance • Three factors cause an employee to perform at a certain level 1. Declarative knowledge -information about facts and things, task’s requirements, labels, principles, and goals. 2.Procedural knowledge - combination of knowing what to do and how to do it and includes cognitive, physical, perceptual, motor, and interpersonal skills. 3. Motivation- It involves a) Choice to expend effort(e.g., “I will go to work today”) b) Choice of level of effort (e.g., “I will put in my best effort at work” versus “I will not try very hard”) C) Choice to persist in the expenditure of that level of effort (e.g., “I will give up after a little while” versus “I will persist no matter what”) 4 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 5. Determinants of Performance • Determinants have a multiplicative relationship- Performance = Declarative Knowledge X Procedural Knowledge X Motivation If any of the determinants has a value of 0, then performance also has a value of 0. Factors Determining Performance Declarative Knowledge Procedural Knowledge Motivation Facts Cognitive skill Choice to perform Principles Psychomotor skill Level of effort Goals Physical skill Persistence of effort Interpersonal skill 5 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 6. Deliberate practice and top performance • Top performers in all fields engage in deliberate practice consistently • Involves the following five steps: 1. Approach performance with the goal of getting better and better. 2. As you are performing, focus on what is happening and why you are doing things the way you do. 3. Once your task is finished, seek performance feedback from expert sources, and the more sources the better. 4. Build mental models of your job, your situation, and your organization. 5. Repeat steps 1–4 continually and on an ongoing basis. 6 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 7. Implications for Addressing Performance Problems • Managers must find information that will allow them to understand whether the source of the problem is – declarative knowledge, procedural knowledge, motivation, or some combination of these three factors • PMS need not only to measure performance but also to provide information about the source of any performance deficiencies. 7 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 8. Factors Influencing Determinants of Performance • Factors include employee (i.e., abilities and previous experience), human resources (HR) practices, and the work environment. • Three individual characteristics that determine performance: -procedural knowledge, declarative knowledge, and motivation • Managers first need to identify which of these factors is hampering performance and then help the employee improve his or her performance 8 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 9. Dimensions of Performance • Performance is multidimensional • we need to consider many different types of behaviors to understand performance. • two types of behaviors or performance facets stand out: task performance and contextual performance • Pro-social behaviors” and “organizational citizenship behaviors” is also contextual performance • Contextual and task performance must be considered separately because they do not necessarily occur in tandem 9 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 10. Task Performance • Activities that transform raw materials into the goods and services that are produced by the organization • Activities that help with the transformation process by replenishing the supply of raw materials, distributing its finished products, or providing important planning, coordination, supervising, or staff functions that enable the organization to function effectively and efficiently 10 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 11. Contextual performance • Those behaviors that contribute to the organization’s effectiveness by providing a good environment in which task performance can occur. • includes behaviors such as- -persisting with enthusiasm and exerting extra effort to complete one’s own task activities successfully (e.g., being punctual and rarely absent, expending extra effort on the job) -Volunteering to carry out task activities that are not formally part of the job (e.g., suggesting organizational improvements, making constructive suggestions) -helping and cooperating with others (e.g., assisting and helping coworkers and customers) following organizational rules and procedures (e.g., following orders and regulations, showing respect for authority, complying with organizational values and policies) -endorsing, supporting, and defending organizational objectives (e.g., organizational loyalty, representing the organization favorably to outsiders) 11 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 12. Main Differences Between Task and Contextual Performance • Task Performance Contextual Performance • Varies across jobs Fairly similar across jobs • Likely to be role prescribed Not likely to be role prescribed • Antecedents: abilities and skills Antecedent: personality 12 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 13. Why Include Task and Contextual Performance Dimensions in PM System? Global competition Customer service Teamwork Employee perceptions of PM Supervisor views Cultural differences 13 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 14. Voice Behavior Behavior that emphasizes expression of constructive challenge with the goal to improve rather than merely criticize Challenges the status quo in a positive way Makes innovative suggestions for change Recommends modifications to standard procedures 14 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 15. Lecture 12: Behaviour, result, and trait approach to performance 15 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 16. Job Performance in Context Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 4-16 A performer (individual or team) In a given situation Engages in certain behaviors That produce various results TRAIT BEHAVIOR RESULTS KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR Source: Adapted from Grote, D. (1996). The complete guide to performance appraisal
- 17. Approaches to measure performance • Employees work in an organizational context, engaging in certain behaviors that produce certain results. • The same employee may behave differently (and produce different results) if placed in a different situation • There are three approaches that can be used to measure performance: -the behavior, results, and trait approaches 17 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 18. Behavior Approach • Emphasizes what employees do on the job • Does not consider employees’ traits or the outcomes resulting from their behaviors • A process-oriented approach that emphasizes how an employee does the job 18 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 19. Appropriateness of behaviour approach 19 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR Appropriate if… • Employees take a long time to achieve desired outcomes • Link between behaviors and results is not obvious • Outcomes occur in the distant future • Poor results are due to causes beyond the performer’s control Not appropriate if… • Above conditions are not present
- 20. Example of Behaviour Approach • Zenser Tech.-a provider of local, wireless, long-distance voice, and voiceover IP services • All employees are evaluated, and development plans are created through the use of five core competencies or “dimensions- act with integrity, focus on the customer, deliver results, build relationships, and demonstrate leadership • These dimensions include the consideration of both task and contextual performance • Employees in the evaluation and development process are asked to write behavioral examples of how they have performed on each dimension • The firm recognized the importance of considering both task and contextual components of a job in its performance management system 20 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 21. Behavior-based (behavior-oriented): measure – Examples for a retail store manager: • Good teamwork • Welcome & thank customers • Good attendance • Monitor customers & employees for theft – Makes sense for many jobs • Use it where how the employee produces results matters 21 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 22. Behavior-based (behaviour-oriented): measure • Behavior-based (cont’d.): – Makes it easier to provide detailed feedback • Examples for a retail store manager: – Results: “You didn’t achieve your sales goal.” – Behavior: “You are allowing your employees to wait too long before offering help to customers.” – Challenges: • Difficult to capture the full range of relevant behaviors • Different behaviors can lead to the same results — do we always care which behaviors were used? 22 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 23. Results Approach • Emphasizes the outcomes and results produced by the employees • A bottom-line approach that is not concerned about employee behaviors and processes but, instead, focuses on what is produced • Examples include sales, number of accounts acquired, time spent with clients on the telephone, number of errors etc. • Defining and measuring results usually takes less time • More cost-effective because results can be less expensive to track than behaviors 23 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 24. Results Approach • The results approach is most appropriate under the following circumstances- • Workers are skilled in the needed behaviors. • Behaviors and results are obviously related. • Results show consistent improvement over time. • There are many ways to do the job right 24 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 25. Results-based (results-oriented): measure • Results-based (results-oriented): measure the results produced by the employee – Examples for a retail store manager: • Sales of the store • Profit per square foot • Inventory shrinkage • Customer satisfaction – Makes sense for many jobs • Use it where results matter 25 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 26. Results-based (results-oriented): measure • Results-based (cont’d.): – Challenges: • Which results are relevant may not be obvious for all jobs • Some results are not under the employee’s control • May foster “results at all costs” mentality • May interfere with teamwork • May be difficult to provide effective feedback 26 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 27. Behavior Approach Versus Results Approach • Behavior approach to measuring performance • The link between behaviors and results is not obvious • Outcomes occur in the distant future • Poor results are due to causes beyond the performer’s control 27 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR • Adopting a results approach to measuring performance is most appropriate when • Workers are skilled in the needed behaviors • Behaviors and results are obviously related • Results show consistent improvement over time • There are many ways to do the job right
- 28. Trait Approach • The trait approach emphasizes the individual performer and ignores the specific situation, behaviors, and results • If one adopts the trait approach, raters evaluate relatively stable traits. • These can include abilities, such as cognitive abilities (which are not easily trainable) or personality (which is not likely to change over time). • Positive relationship between abilities, personality traits, and desirable work-related behaviors • Appropriate if structural changes planned for organization 28 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 29. Challenges in implementing trait based approach • Traits are not under the control of individuals. • They are fairly stable over one’s life span. • They do not change even if an individual is willing to exert substantial effort to do so • Employees may feel that a system based on traits is not fair because the development of these traits is usually beyond their control • Possessing certain trait (e.g., intelligence) does not mean that it will lead to desired results and behaviors. • In most organizations, performance is not measured using the trait approach 29 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 30. Lecture 13: Measuring Behaviour and results 30 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 31. Measuring results: Some issues • key accountabilities-What are the different areas in which this individual is expected to and responsible for producing results. • Expected objectives-Within each area, statements of important and measurable outcomes. • performance standards- How do we know how well the results have been achieved? 31 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 32. Determining Accountabilities • The first step is to collect information about the job through job description • Resulted from the job analysis and a consideration of unit- and organization-level strategic priorities. • Tasks included in the job description can be grouped into clusters of tasks based on their degree of relatedness • Each of these clusters or accountabilities is a broad area of the job for which the employee is responsible for producing results 32 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 33. Relative importance of accountabilities • Ask the following questions- What percentage of the employee’s time is spent performing each accountability? If the accountability were performed inadequately, would there be a significant impact on the work unit’s mission? Is there a significant consequence of error? Could inadequate performance of the accountability contribute to the injury or death of the employee or others, serious property damage, or loss of time and money 33 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 34. Example of determining accountability • Company: Delta consulting • Role: training specialist/consultant • Job description: training need analysis of workers; design, development and delivery of training; evaluating training effectiveness; leadership and strategic responsibility. • List of the accountabilities: Process leadership, Supervision of nonexempt staff, Coaching, Team-building consultation, Assessment instrument feedback, Product improvement 34 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 35. Determining Objectives • Statements of an important and measurable outcome if accomplished ensure success for the accountability. • Identify a limited number of highly important results having dramatic impact on the overall success. • feedback on their progress toward attaining the objective • Rewards allocation if objectives are reached 35 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 36. Characteristics of a good objective • Specific and clear- cut cost by 20% • Challenging- stretchable to reach • Agreed upon- result from an agreement between the manager and the employee • Significant- must be important and contribute to success • Prioritized- set priority and handle one be one • Bound by time-deadlines and mileposts • Achievable- doable • Fully communicated- Making aware 36 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 37. Determining Performance Standards • Yardsticks designed to help people understand to what extent the objective has been achieved • Provide raters with information about what to look for to determine the level of performance that has been achieved • refer to various aspects of a specific objective, including quality, quantity, and time 37 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 38. Performance criteria • Each of these aspects can be considered a criterion to judge the extent to which an objective has been achieved. - Quality-how well the objective has been achieved, include usefulness, responsiveness, effect obtained acceptance rate, error rate, and feedback - Quantity: how much has been produced, how many, how often, and at what cost? - Time: due dates, adherence to schedule, cycle times, deadlines. 38 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 39. Example of Standards • Standards must include an action, the desired result, a due date, and some type of quality or quantity indicator • Example: Reduce overtime from 150 hours/month to 50 hours/month by December 1, 2017, at a cost not to exceed $12,000. The action is reduce, the due date is December 1, 2017 • As soon as a standard has been created, one can create standards that describe minimum performance and outstanding performance • Example- Reduce overtime from 150 hours/month to 40 hours/month by October 1, 2018, at a cost not to exceed $12,000. 39 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 40. Characteristics of good performance • Related to the position • Concrete, specific, and measurable • Practical to measure • Meaningful • Realistic and achievable • Reviewed regularly 40 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 41. Measuring behaviour • A behavior approach to measuring performance includes the assessment of competencies. • Competencies are measurable clusters of knowledge, skills, and abilities (KSAs). • Critical in determining how results will be achieved • Examples of competencies – customer service, written or oral communication, creative thinking, and dependability 41 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 42. Type of competencies • Two types of competencies • differentiating competencies- allow us to distinguish between average and superior performers • threshold competencies- those that everyone needs to display to do the job to a minimally adequate standard • Example of a IT project manager-differentiating competency is process management (ability to manage project activities), and threshold competency is change management (knowledge of behavioral sciences, operational and relational skills, and sensitivity to motivators) • Example of a professor- communication, conveying information during preassigned times and dates 42 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 43. Indicators of Competencies Leadership competency indicators Supports subordinates’ projects Asks about the well-being of employees’ lives outside of work Encourages subordinates to reach their established goals Gets to know employees personally Shows respect for employees’ work and home lives 43 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR Observable behaviors and Used to measure the extent to which competencies are present or not
- 44. Components of competency • Definition of competency • Description of specific behavioral indicators that can be observed when someone demonstrates a competency effectively • Description of specific behaviors that are likely to occur when someone doesn’t • demonstrate a competency effectively (what a competency is not) • List of suggestions for developing the competency in question the measurement of competencies is intrinsically judgmental. 44 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 45. Measuring competency • Competencies are measured using data provided by individuals who make a judgment regarding the presence of the competency • behaviors displayed by the employees are observed and judged by raters • raters might also include peers, customers, subordinates, and the employee himself). 45 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 46. Lecture 14: Measurement System 46 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 47. Selecting a measurement system • Two types of systems are used to evaluate competencies: comparative systems and absolute systems • Comparative systems base the measurement on comparing employees with one other. • Absolute systems base the measurement on comparing employees with a prespecified performance standard 47 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 48. Comparative and Absolute Behavioral Measurement Systems 48 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 49. Advantages of Comparative Systems • Easy to explain • Straightforward • Identifies top as well as underperformers • Better control for biases and errors found in absolute systems – Leniency – Severity – Central tendency 49 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 50. Disadvantages of Comparative Systems • Rankings may not be specific enough for: – Useful feedback – Protection from legal challenge • No information on relative distance between employees • Specific issues with forced distribution method 50 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 51. Comparative systems – Simple Rank order- subjectively rank employees from best to worst • Example: 1. Ramu 2. Gopal 3. Tushar 4. Zafar 51 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR Advantages: Simple and easy to do Results are clear Disadvantages: Judges performance based on one dimension only May be difficult to rank similar performance levels
- 52. Alternation Rank Order • Advantages: – Simple and easy to do – Results are clear – Uses two anchors (best and worst) • Disadvantages: – Judges performance based on one dimension only – May be difficult to rank similar performance levels – Does not specify threshold for acceptable performance 52 The supervisor initially lists all employees. Then, the supervisor selects the best performer (#1), then the worst performer (#n), then the second best (#2), then the second worst (#n1), and so forth, alternating from the top to the bottom of the list until all employees have been ranked KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 53. Comparative systems • Paired Comparisons: in all possible pairs of employees, subjectively rate which employee is better • # of paired comparisons = (N2 – N)/2 • Example: N = 4 → 6 paired comparisons: – Ramu > Gopal; Ramu > Tishar; Ramu > Zafar – Gopal > Tushar; Gopall > Zafar – Tushar > Zafar • Example: N = 12 → 66 paired comparison 53 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR Advantages: Thorough Final rankings are more accurate Disadvantages: Very time consuming May encounter problem of comparing “apples and oranges”
- 54. Relative Percentile • Asks raters to consider all ratees at the same time and to estimate the relative performance of each by using a 100-point scale • include one such scale for each competency and also include one scale on which raters evaluate the overall performance of all employees. 54 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR Advantages: Simple and easy to use Evaluates specific competencies or overall performance Disadvantages: May be difficult to consider all ratees at the same time Time consuming if using several scales for different competencies
- 55. Forced distribution Employees are apportioned according to an approximately normal distribution. Evaluator must place a fixed percentage of employees in each performance category • Example: 10% must be rated 5 = Excellent 20% must be rated 4 = Very satisfactory 40% must be rated 3 = satisfactory 20% must be rated 2 = Unsatisfactory 10% must be rated 1 = Very unsatisfactory But what if the distribution being forced doesn’t fit? 55 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR Advantages: Categorizes employees into specific performance groups Facilitates reward assessment Competition may be good for organizational performance Disadvantages: Assumes performance scores are normally distributed May discourage contextual performance and teamwork
- 56. Absolute Systems • It includes Essays, Behavior checklists, Critical incidents, and Graphic rating scales. • Advantages: – Can be used in large and small organizations – Evaluations more widely accepted by employees • Disadvantages: – Higher risk of leniency, severity, and central tendency biases – Generally, more time consuming than comparative systems 56 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 57. Rating scale – graphic rating scale: subjectively rate the employee’s performance on a labeled numeric measuring scale • Rate overall job performance as well as specific aspects of job performance • Example: 5 = Excellent 4 = Very satisfactory 3 = Satisfactory 2 = Unsatisfactory 1 = Very unsatisfactory 57 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR Use a graphic or just use words? Label all the points in the scale, or just label the endpoints of the scale? Odd or even number of points in the scale? Fewer points in the scale, or more points in the scale?
- 58. Graphic rating scale • Advantages: – Meanings, interpretations, and dimensions being rated are clear – Useful and accurate – Most popular tool • Disadvantages: – Time consuming and resource-laden to develop – Lacks individualized feedback and recommendations 58 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 59. Behaviorally Anchored Rating Scale (BARS) • Replace the vague descriptors in a traditional rating scale with specific examples of performance • Example: Customer assistance • 5 = Expected to volunteer to help customer and to walk with customer • 4 = Expected to walk with customer to desired product location when asked for help by customer • 3 = Could be expected to tell and point customer to where the desired product is located • 2 = Could be expected to shrug shoulders and walk away when asked for assistance by customer • 1 = Could be expected to hide from customers in the employee break- room 59 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 60. BARS (Continued) • A different scale will be needed for each aspect of performance • Advantages: – Job-relevant measures of performance – Involves employees in developing scales Disadvantages: – More work to develop BARS (time & money) – Employees may not consistently fit into one of the BARS categories 60
- 61. Behavior Checklists • Consists of a form listing behavioral statements that are indicators of the various competencies to be measured. • The supervisor’s task is to indicate (“check”) statements that describe the employee being rated 61 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR Advantages: Easy to use and understand Provides quantitative information Widespread use More objective than other systems Disadvantages: May feel impersonal and disconnected Scale points used are often arbitrary Difficult to get detailed and useful feedback
- 62. Essays • Describing each employee’s strengths and weaknesses and makes suggestions for improvement. • Advantages: Simplest absolute method Individualized for each employee Can be done anytime Potential for detailed feedback • Disadvantages: Unstructured and may lack detail Depends on supervisor’s writing skill Comparisons virtually impossible Lack of quantitative information; difficult to use in personnel decisions 62 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 63. Critical incidents technique • Involves gathering reports of situations in which employees exhibited behaviors that were especially effective or ineffective in accomplishing their jobs. • Advantages: – Focus on actual job behavior – Provides specific examples – Employees identify with rating • Disadvantages: – Collecting critical incidents can be very time consuming – Quantification is difficult 63 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 64. Lecture 15: Collecting information in Performance Measurement 64 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 65. Components of an appraisal form • Basic employee information • Accountabilities, objectives, and standards • Competencies and indicators • Major achievements and contributions • Developmental achievements • Developmental needs, plans, and goals • Stakeholder input • Employee comments • Signatures 65 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 66. Characteristics of an appraisal form • Simplicity • Relevancy • Descriptiveness • Adaptability • Comprehensiveness • Definitional clarity • Communication • Time orientation 66 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 67. Determining Overall Rating • Two main strategies are used-judgmental and mechanical • Judgmental procedure consists of considering every aspect of performance and then arriving at a defensible summary • Mechanical procedure consists of first considering the scores assigned to each section of the appraisal form and then adding them up to obtain an overall score 67 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 68. Open-Ended (Comments) Sections Challenges • Difficult to systematically categorize and analyze • Quality, length, and content vary Tools to overcome challenges • Computer-aided text analysis (CATA) software • Establish goals of information provided • Training in systematic and standardized rating skills 68 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 69. Appraisal period and number of meetings • How long should the appraisal period be? • Annual review; semiannual or quarterly formal reviews • Annual review might not provide sufficient opportunity for the supervisor and subordinate to discuss performance issues • When Review Is Completed- Anniversary date: Supervisor doesn’t have to fill out forms for all employees at the same time; Can’t tie rewards to fiscal year Fiscal year: Rewards tied to fiscal year; Goals tied to corporate goals; May be burden to supervisor, depending on implementation 69 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 70. Six formal meetings in PMS • System inauguration • Self-appraisal • Classical performance review • Merit/salary review • Development plan • Objective setting 70 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 71. Who Should Provide Performance Information? Employees should be involved in selecting • Which sources evaluate • Which performance dimensions When employees are actively involved • Higher acceptance of results • Perception that system is fair 71 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 72. Who Should Provide Performance Information? Direct knowledge of employee performance • Supervisors • Peers • Subordinates • Self • Customers 72 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 73. Who Should Provide Performance Information? • Supervisors- Advantages • Can evaluate performance vs. strategic goals • Make decisions about rewards • Able to differentiate among performance dimensions • Viewed as exclusive source in some cultural contexts Disadvantages • Supervisor may not be able to directly observe performance • Evaluations may be biased 73 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR Peers- Advantages Assess teamwork Disadvantages Possible friendship bias May be less discriminating Context effects
- 74. Who Should Provide Performance Information? • Subordinates- Advantages: Accurate when used for developmental purposes Good position to assess some competencies Disadvantages: Inflated when used for administrative purposes May fear retaliation (confidentiality is key) • Self- Advantages • Increased acceptance of decisions • Decreased defensiveness during appraisal interview • Good position to track activities during review period Disadvantages • May be more lenient and biased 74 Customers- Advantages Employees become more focused on meeting customer expectations. Disadvantages Time Money KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 75. Disagreement Across Sources • Expect disagreements • Ensure employee receives feedback by source • Assign differential weights to scores by source, depending on importance • Ensure employees take active role in selecting which sources will rate which dimensions 75 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 76. Common appraisal problems • Supervisory bias • Unclear standards • Halo effect or Horn effect • Central tendency- - Leniency - Strictness - Similar to me - Recency - Spillover effect 76 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 77. Expected Positive and Negative Consequences of Rating Accuracy Probability of Experiencing Positive and Negative Consequences Expected Positive and Negative Consequences of Rating Distortion Probability of Experiencing Positive and Negative Consequences Motivation to Provide Accurate Ratings Motivation to Distort Ratings Rating Behavior A Model of Rater Motivation Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 6-77 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 78. Motivation for rating inflation and deflation • Motivations for Rating Inflation- • Maximize merit raise/rewards • Encourage employees • Avoid creating written record • Avoid confrontation with employees • Promote undesired employees out of unit • Make manager look good to his/her supervisor • Motivations for Rating Deflation • Shock employees • Teach a lesson • Send a message to employee • Build a written record of poor performance 78 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
- 79. Rater Training Programs • Information • Motivation • Identifying, observing, recording and evaluating performance • How to interact with employees when they receive performance information • Reducing Intentional Rating Distortion through- • Have raters justify their ratings and Have raters justify their ratings in a face-to-face meeting 79 KBL Srivastava Humanities and Social Sciences IIT KHARAGPUR
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