VII Astana Economic Forum „ Civil Service Personnel Management: current issues and prospects “

„Performance Appraisal of Civil Servants – Problems, Methods and Developments“

VII Astana Economic Forum„Civil Service Personnel Management: current issues and prospects“

Prof. Dr. Dieter Wagner Potsdam Center of Policy Management (PCPM) University of Potsdam, Germany

May 22, 2014 Astana, Kazakhstan

HR Management Activities

May 22, 2014 Prof. Dr. Dieter Wagner - Potsdam Center of Policy Management (PCPM) 2

GLO

BA

L

ENVIRONMENTALCULTURAL/GEOGRAPHIC

TECHNOLOGICAL

POLITICAL

SO

CIA

L

LEGAL

ECONOMIC

OrganizationMission

Cultur

e

Size

Operations

External EnvironmentInternal Environment

HR Planning• HR Planning• HR Information and Assessment Systems

Equal Employment Opportunity• Compliance• Diversity

Staffing• Job Analysis• Recruitment• Selection

HR Development• Training• Career Planning• Performance Mgmt.

Compensation andBenefits• Administration• Incentives• Benefits

Health, Safety and Security• Health & Wellness• Safety & Security

Labor Relations• HR Policies• HR Rights and Privacy• Union/Mgmt. Relations HRHR

ActivitiesActivities

Traditional Principles of a Professional Civil Service: The German Example


• lifetime occupation and an “office-appropriate” salary

• Loyalty

• political neutrality and moderation

• dedication to public service

• no right to strike

• subjection to special disciplinary regulations

Civil service systems

A. Focus at career development:

•Career system: each civil servant starts at the bottom of a career level after competitive entry exams and continuously “climbs up” the career ladder

•Position system: civil servants are recruited to work in a specific job position; career development is less or not relevant

B. Employment status:

•Statutory employment: recruitment based on legal act

•Contractual employment


Career vs position systemand employment variants


Position-based systems

Career-based systems

Statutory Contractual

Traditional core functions in government

Services and other production functions

(Knut Rexed, 2007)

Civil servants

Public Employees

In various countries: employment of “civil servants” with specific privileges (e.g. pension, life-long tenure and specific duties (e.g. neutrality, loyalty, no right to strike) and of “public employees” (similar to private sector conditions)

Personnel selection


General principle:

aligning qualification requirements of positions with competences of candidates

Requirement profile (job specifications)

Competence profile of candidates

Job Requirements, Skills, and Qualification Profiles


Type

Extentexisting, but not required capabilities

required, but not existing capabilities

Job Requirement Profile Skill Profile Qualification Profile

Position classification

Position classifications are formal job descriptions that organize all jobs in a civil service system into classes on the basis of duties and responsibilities, for the purposes of delineating authority, establishing chains of command, and providing equitable salary scales.

(www.csub.edu)

e.g. Germany: 4 “classes” with each 5 grades:

•Administrative class

•Executive class

•Clerical class

•Subclerical class


Job Performance and Selection Criteria


Elements of Job Performance•Quantity of work•Quality of work•Compatibility with others•Presence at work•Length of service•Flexibility

Selection Criteria for Employees Meeting Performance Elements•Ability•Motivation•Intelligence•Conscientiousness•Appropriate risk for employer•Appropriate permanence

Predictors of Selection Criteria•Experience•Past performance•Physical skills•Education•Interests•Salary requirements•Certificates/ degrees•Test scores•Personality measures•Work references•Tenure on previous jobs•Previous jobs held•Drug test•Police record

Evaluating for HR Development


Potential Candidate

Promotable Candidate

Key-PerformerUnder-

Performer

Outperforms job requirements Able to take over next-hierarchy-level-task in the short term

Perfect match of job requirementsPromotion to next-hierarchy-level likely in the long term

Minimum match of job requirements

Promotion rather unlikely

No match of job requirements

Role of performance in public sector HRM

• Performance assessment in PA is traditionally not very important in terms of a comprehensive analysis of performance, conduct, personal development, professional capabilities and soft skills.

• There are no clear guidelines for:

– How is individual performance defined?

– What is good or exceptional performance?

– What happens if performance is very good or bad?

• Little willingness to accept that there are sustantial differences in individual (and group) performance and that incentives must be created to support „high performers“

• remarkeable reluctance to measure individual performance and to let these measures make a difference for pay, career etc.


Role of performance in public sector HRM

• Lacking knowledge about appropriate incentives

• discussion concentrates on monetary rewards but money is not a key driver for motivation and performance in PA

• Instead, individuals want to be appreciated for their work, supported in their personal development, have interesting and demanding jobs, aspire responsibility and discretion

• Immaterial incentives are not yet sufficiently integrated in the general rewards systems: job profile, self-efficacy, responsibilities, workplace environment, training, career perspectives etc.


Main conditions of performance orientation of public servants


ability willingness

transparency of performance

(targets, inputs,costs, outputs, outcomes)

qualification

performancemotivation

(performance-related incentives)

performance-related rewards and

sanctions

performanceorientation

Schematic Structuring of HR Appraisal


HR Appraisal

PersonalityAppraisal

PerformanceAppraisal

Hybrid Systems

Hybrid Systems

PerformanceAppraisal

PotentialAppraisal

DevelopmentAppraisal

Performance Appraisal Problems


ProblemsProblemsProblemsProblems

Abstract & Unrealistic

Goals/Objectives

Abstract & Unrealistic

Goals/Objectives

Neglecting “Daily

Business”

Neglecting “Daily

Business”

Concentrationon the

Appraisal ofSpecial Tasks

Concentrationon the

Appraisal ofSpecial Tasks

Orientation on Outperformers

Orientation on Outperformers

InaccurateScaling of

Performance Standards

InaccurateScaling of

Performance Standards

Experiences with performance appraisals (in the OECD world):

(at least) yearly performance appraisal

•closely linked with performance agreement

•assessing individual achievement of agreed targets

•feedback about necessary adjustments and improvements

•consequences for training and/or task adjustments

•experienced countries: U.S.A., U.K., Australia, Belgium, Canada, Denmark, the Netherlands, Norway, Spain, Sweden and Switzerland (partly only for senior staff or only voluntarily)

some typical deficits:

•measurement problems

•allocating fair judgements to individuals (tendency of leniency)

•Lack of “punishing” low performers


Performance Appraisal Cycle


• Establish a common understanding between the evaluator and evaluatee regarding work expectations; the work to be accomplished and how that work is to be evaluated.

• Ongoing assessment of performance and the progress against work expectation

• Exchange regular feedbacks of information to clarify and modify the goals and expectations, to correct unacceptable performance before it was too late, and to reward superior performance with proper praise and recognition.

Source: Mohrman A. et al., 1989: 109

Information to other

organizational systems

Defining performanc

e

Feedback about

performance

Measuring and

evaluating performanc

e

Performance Appraisal Methods


possible performanceappraisal instruments:

Performance-oriented

•Traits•Skills

Behaviour-oriented

•Predetermined descriptionsof behavior

•Behaviorally anchoredrating scales (BARS)

• Ranking• Paired comparison

Comparison-Oriented

• Management by Objective (MbO)• Work planning and review

Result-Oriented

Measuring Performance

Src.: Adapted from Dessler G.2003:243-252 & Mohrman A. et al., 1989: 48-54

• Interviews• Written tests• On-job observations• (peer) feedback surveys• Assessment form

• manuals • checklists• guidelines• performance contracts• …

Integration of PA with other HRM Systems


performanceappraisal

market base pay totalcompensation

pay action

humanresources

staffingplan

trainingprograms

selectionprocess

jobevaluation

job designstrategystructure

Source: Mohrman A. et al., 1989: 209

Reward Systems – General overview from business perspective


Public sector compensation systems

• Merit system: Salaries based on seniority / merit

• Performance Pay: Salaries include pay elements for extraordinary individual performance

• other compensation elements:– social factors: family, age, etc; – allowances: for positions in remote areas or with risky tasks– health insurance and pension payments


Case Study: Great Britain


Basic SalaryThree performance “tranches” Based on relative contributionPosition in pay range and tranche marking determine award

BonusesIn year to recognize performance as it happens End year to reward exceptional achievements or outcomes delivered over

whole yearInformal noticeStaff appraisal

Basic SalaryTarget salary at the market median with premium rates for top performers Link progression into performance and development systemAgreed distribution

BonusesIncentives for top/high performers

Cab

inet

Offi

ceD

epar

tmen

t for

W

ork

and

Pen

sion

s

Experiences with performance-related pay (PRP):


• majority of OECD countries introduced PRP

• sometimes extended PRP schemes for (senior) management staff

• evidence: limited impact of PRP on motivation and performance (“pacifier” function, modest position in reward’s rankings)

some negative side effects of PRP:• unfair measurement practices

• intransparent regulations

• unattractive/small bonuses

• restriction to a small proportion of high-performers = majority of dissatisfied “loosers”

• bonus distribution according to “equal share” principle

• withholding of previously paid bonuses

• neglecting of team performance

Contingency Pay


Motivation

Message

to achieve higher levels of performance or depth of their competences or skills

that certain values or aspects of performance are important. ( quality, customer service, leadership and team working)

Equity people should be paid in relation to their performances

Rationale:

Clear about the target + clear target definition

Must influence people behaviour

Rewards may be meaningful enough

The bonus formula may be easy to understand

Reward should be done as quickly as possible

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5 Golden Rules:

Thank you very much for your attention.


Documents

VII Astana Economic Forum „ Civil Service Personnel Management: current issues and prospects “