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PowerPoint Presentation by Charlie CookThe University of West Alabama
Chapter 9
Performance Management and Appraisal
Part Three | Training and Development
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–2
1.1. Define performance management and discuss how it Define performance management and discuss how it differs from performance appraisal.differs from performance appraisal.
2.2. Set effective performance appraisal standards.Set effective performance appraisal standards.
3.3. Describe the appraisal process.Describe the appraisal process.
4.4. Develop, evaluate, and administer at least four Develop, evaluate, and administer at least four performance appraisal tools.performance appraisal tools.
5.5. Explain and illustrate the problems to avoid in Explain and illustrate the problems to avoid in appraising performance.appraising performance.
6.6. Discuss the pros and cons of using different raters to Discuss the pros and cons of using different raters to appraise a person’s performance.appraise a person’s performance.
7.7. Perform an effective appraisal interview.Perform an effective appraisal interview.
LEARNING OUTCOMESLEARNING OUTCOMES
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–3
Basic Concepts in Basic Concepts in PerformancePerformance
Management and AppraisalManagement and AppraisalPerformance
Appraisal
Setting work standards, assessing
performance, and providing feedback
to employees to motivate, correct, and continue their
performance.
Performance Management
An integrated approach to
ensuring that an employee’s
performance supports and
contributes to the organization’s strategic aims.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–4
An Introduction to Appraising An Introduction to Appraising PerformancePerformance
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Is useful in career planning.
Plays an integral role in performance management.
Why Appraise Performance?
Is basis for pay and promotion decisions.
Helps in correcting deficiencies and reinforcing good performance.
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Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–5
(Un)Realistic Appraisals(Un)Realistic Appraisals• Motivations for Soft AppraisalsMotivations for Soft Appraisals
The fear of having to hire and train someone new.The fear of having to hire and train someone new. The unpleasant reaction of the appraisee.The unpleasant reaction of the appraisee. An appraisal process that’s not conducive to candor.An appraisal process that’s not conducive to candor.
• Hazards of Soft AppraisalsHazards of Soft Appraisals Employee loses the chance to improve before being discharged Employee loses the chance to improve before being discharged
or forced to change jobs.or forced to change jobs. Lawsuits arising from dismissals involving inaccurate Lawsuits arising from dismissals involving inaccurate
performance appraisals.performance appraisals.
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Performance Appraisal RolesPerformance Appraisal Roles• The Supervisor’s RoleThe Supervisor’s Role
Usually do the actual appraisingUsually do the actual appraising
Must be familiar with basic Must be familiar with basic appraisal techniquesappraisal techniques
Must understand and avoid Must understand and avoid problems that can cripple problems that can cripple appraisalsappraisals
Must know how to conduct Must know how to conduct appraisals fairlyappraisals fairly
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–7
Performance Appraisal Roles Performance Appraisal Roles (cont’d)(cont’d)• The HR Department’s Role The HR Department’s Role
Serves a policy-making and advisory role.Serves a policy-making and advisory role.
Provides advice and assistance regarding the appraisal Provides advice and assistance regarding the appraisal tool to use.tool to use.
Trains supervisors to improve their appraisal skills.Trains supervisors to improve their appraisal skills.
Monitors the appraisal system effectiveness and Monitors the appraisal system effectiveness and compliance with EEO laws.compliance with EEO laws.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–8
Effectively Appraising PerformanceEffectively Appraising Performance
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Appraising performance
Steps in Appraising Performance
Defining the job and performance criteria
Providing feedback session
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Defining the Employee’s Defining the Employee’s Goals and Work StandardsGoals and Work Standards
Set SMART goals
Assign challenging
/ doable goals
Assign specific
goals
Guidelines for Effective
Goal Setting
Assign measurable
goals
Encourage participatio
n
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–10
Setting SMART GoalsSetting SMART Goals• SSpecific, and clearly state the desired results.pecific, and clearly state the desired results.
• MMeasurable in answering “how much.”easurable in answering “how much.”
• AAttainable, and not too tough or too easy.ttainable, and not too tough or too easy.
• RRelevant to what’s to be achieved.elevant to what’s to be achieved.
• TTimely in reflecting deadlines and milestones.imely in reflecting deadlines and milestones.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–11
Designing the Appraisal ToolDesigning the Appraisal Tool• What to Measure?What to Measure?
Work output (quality and quantity)Work output (quality and quantity) Personal competenciesPersonal competencies Goal (objective) achievementGoal (objective) achievement
• How to Measure?How to Measure? Generic dimensionsGeneric dimensions Actual job dutiesActual job duties Behavioral competenciesBehavioral competencies
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–12
Performance Appraisal MethodsPerformance Appraisal Methods
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Alternation ranking
Graphic rating scale
Paired comparison
Forced distribution
Critical incident
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Behaviorally anchored rating scales (BARS)
Narrative forms
Management by objectives (MBO)
Computerized and Web-based performance appraisal
Merged methods
Appraisal Methodologies
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FIGURE 9–3 One Item from an Appraisal Form Assessing Employee Performance on Specific Job-Related Duties
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FIGURE 9–4 Appraisal Form for Assessing Both Competencies and Specific Objectives
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FIGURE 9–5 Scale for Alternate Ranking of Appraisee
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–16
FIGURE 9–6 Ranking Employees by the Paired Comparison Method
Note: + means “better than.” - means “worse than.” For each chart, add up the number of +’s in each column to get the highest ranked employee.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–17
TABLE 9–1 Examples of Critical Incidents for Assistant Plant Manager
Continuing Duties Targets Critical Incidents
Schedule productionfor plant
90% utilization of personnel and machinery in plant; orders delivered on time
Instituted new production scheduling system; decreased late orders by 10% last month; increased machine utilization in plant by 20% last month
Supervise procurement of raw materials and on inventory control
Minimize inventory costs while keeping adequate supplies on hand
Let inventory storage costs rise 15% last month; over-ordered parts “A” and “B” by 20%; under-ordered part “C” by 30%
Supervise machinery maintenance
No shutdowns due to faulty machinery
Instituted new preventative maintenance system for plant; prevented a machine breakdown by discovering faulty part
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–18
FIGURE 9–7Appraisal-Coaching Worksheet
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FIGURE 9–8Example of a Behaviorally Anchored Rating Scale for the Dimension Salesmanship Skills
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–20
Dealing with Dealing with Performance Appraisal Performance Appraisal
ProblemsProblems
Unclear standards
Leniency or strictness
Halo effect
Potential Rating Scale Appraisal
Problems
Central tendency Bias
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TABLE 9–2 A Graphic Rating Scale with Unclear Standards
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–22
Guidelines for Effective AppraisalsGuidelines for Effective Appraisals
Know the problems
Get agreement on a plan
Use the right tool
How to Avoid Appraisal Problems
Keep a diary
Be fair
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–23
TABLE 9–3 Important Advantages and Disadvantages of Appraisal Tools
Tool Advantages Disadvantages Graphic rating scale Simple to use; provides a quantitative
rating for each employee. Standards may be unclear; halo effect, central tendency, leniency, bias can also be problems.
BARS Provides behavioral “anchors.” BARS is very accurate.
Difficult to develop.
Alternation ranking Simple to use (but not as simple as graphic rating scales). Avoids central tendency and other problems of rating scales.
Can cause disagreements among employees and may be unfair if all employees are, in fact, excellent.
Forced distribution method
End up with a predetermined number or % of people in each group.
Employees’ appraisal results depend on your choice of cutoff points.
Critical incident method
Helps specify what is “right” and “wrong” about the employee’s performance; forces supervisor to evaluate subordinates on an ongoing basis.
Difficult to rate or rank employees relative to one another.
MBO Tied to jointly agreed-upon performance objectives.
Time-consuming.
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Choosing the Right Appraisal ToolChoosing the Right Appraisal Tool
Accessibility AccuracyEase-of-use Employee acceptance
Criteria for Choosing an Appraisal Tool
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Who Should Do the Appraising?Who Should Do the Appraising?
Self-rating
Subordinates
360-degree feedback
Potential Appraisers
Immediate supervisor
Peers
Rating committee
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The Appraisal InterviewThe Appraisal Interview
Satisfactory—Promotable
Satisfactory—Not Promotable
Unsatisfactory—Correctable
Unsatisfactory—Uncorrectable
Types of Appraisal Interviews
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Appraisal Interview GuidelinesAppraisal Interview Guidelines
Talk in terms of objective work data
Get agreement
Don’t get personal
Encourage the person to
talk
Guidelines for Conducting an Interview
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Handling Defensive ResponsesHandling Defensive Responses
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Recognize your own limitations.
Never attack a person’s defenses.
How to Handle a Defensive Subordinate
Recognize that defensive behavior is normal.
Postpone action.
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How to Deliver CriticismHow to Deliver Criticism
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How to Criticize a Subordinate
Criticize in private, and do it constructively.
Do it in a manner that lets the person maintain his or her dignity and sense of worth.
Give daily feedback so that the review has no surprises.
Never say the person is “always” wrong.
Criticism should be objective and free of biases.
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 9–30
Formal Written WarningsFormal Written Warnings• Purposes of a Written WarningPurposes of a Written Warning
To shake your employee out of bad habits.To shake your employee out of bad habits. To help you defend your rating, both to your own boss and (if To help you defend your rating, both to your own boss and (if
needed) to the courts.needed) to the courts.
• A Written Warning Should:A Written Warning Should: Identify standards by which employee is judged.Identify standards by which employee is judged. Make clear that employee was aware of the standard.Make clear that employee was aware of the standard. Specify deficiencies relative to the standard.Specify deficiencies relative to the standard. Indicate employee’s prior opportunity for correction.Indicate employee’s prior opportunity for correction.
