Performance Management MSHRD UWI -2006 - Presentation Transcript

1. 2. Performance Management MSHRD UWI -2006 Identify the major determinants ofYPerformance Management Discuss the three general purposes of performanceYindividual performance. Identify the five criteria for effective performance-managementYmanagement. Discuss the four approaches to performance management, the specificYsystems. techniques used in each approach, and the way these approaches compare with the criteria for effective performancemanagement systems. Choose the most effective approach toYPerformance Management Discuss the advantages andYperformance measurement for a given situation. Choose theYdisadvantages of the different sources of performance information. most effective source(s) for performance information for any situation. Distinguish types of rating errors and explain how to minimize each in aY performance evaluation. Understand the performance appraisalYPerformance Management Conduct an effective performance feedback session. Identify theYprocess characteristics of a performance measurement system that follows legal guidelines. Performance management is the process throughYIntroduction which managers ensure that employee activities and outputs are congruent with Performance Appraisal is the process through which anYthe organization's goals. organization gets information on how well an employee is doing his or her job. Performance Feedback is the process of providing employees informationY regarding their performance effectiveness. McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. PerformanceYPERFORMANCE APPRAISAL VS PERFORMANCE MANAGEMENT appraisal -- setting standards, informing employees, ratings and feedback. Performance management -- all of those processes led by managers to helpY employees perform as effectively as they can. Improve employee performanceYGOALS OF PERFORMANCE MANAGEMENT Meet employee need for feedbackY Develop people for promotional opportunities Y Provide theY Ensure that employees are working toward organizational goals Y data needed to make and defend important human resources decisions MEASURINGYDEFINING PERFORMANCE Y3 PARTS OF PERFORMANCE SYSTEM FEEDBACKINFORMATION OF PERFORMANCEYPERFORMANCE An Organizational Model of Performance Management Organizational Strategy Long and short term goals and values Individual Attributes Individual Objective (skills, abilities) Behaviors Results Situational Constraints Culture and economic conditions McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. Purposes of Performance Management Strategic Administrative Developmental McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. Performance Measures Criteria Five performance criteria stand out: Strategic congruence Specificity Validity Acceptability Reliability McGrawHill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. Performance Measures Criteria All approaches and techniques used for measuring and managing performance must be evaluated against the criteria of : - Strategic Congruence - Validity -Reliability - Acceptability -Specificity STRATEGIC CONGRUENCE DEFINITION: The extent to which the performance management system elicits its job performance that is congruent with the organisations strategy, goals and culture. VALIDITY DEFINITION: The extent to which the performance measure assesses all the relevant and only the relevant aspects of performance. Validity is concerned with maximizing theYValidity continued overlap between actual job performance and the measure of job performance Performance measure is deficient if it does not measure all aspects ofY A contaminated measure evaluates irrelevant aspects of performanceYperformance that are not job related Contamination and Deficiency of a Job Performance Measure Job Actual, or true Performance job performance measure Contamination Validity Deficiency RELIABILITY DEFINITION: The extent to which the performance is consistent; the degree to which a performance measure is free from random error INTERNALYINTERRATER RELIABILITY Y3 TYPES OF RELIABILITY TEST-RETEST RELIABILITYYCONSISTENCY RELIABILITY ACCEPTABILITY DEFINITION: The extent to which a performance measure is deemed to be satisfactory or adequate by those who use Categories of Perceived Fairness & Implications for Performance Management Systems Fairness Importance for Category Performance Mgmt System Implications Procedural Development Give mgrs & employees opportunity to Fairness participate in developing system. Ensure consistent standards when evaluating different employees. Minimize rating errors & bias Interpersonal Use Give timely& complete feedback. Allow Fairness employees to challenge the evaluation. Provide feedback in an atmosphere of respect and courtesy. Outcome Fairness Outcomes Communicate expectations regarding performance evaluations & standards. Communicate expectations regarding rewards SPECIFICITY DEFINITION: The extent to which the performance measure gives detailed guidance to employees about what is expected of them and how they can meet these expectations. What is a performanceYAPPROACHES TO MEASURING PERFORMANCE measure? A generic term encompassing the quantitative basis by which objectives These includeYare established and performance is assessed and gauged. performance objectives and criteria, performance standards and other means that evaluate the success in achieving a specified goal. Aim is to manage performance byYUses of Performance Measures Measure performance inYfocusing on employee attributes, behaviors, or results. a relative way, making overall comparisons among individuals performance.

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24. AttributeYComparative YApproaches to Measuring Performance Quality ApproachYResults Approach YBehavioral Y 25. Approaches to Measuring Performance Types of Rating Scales Comparative Attribute Behavioral Compares individuals Focuses on extent to which Defines behaviors employee performance with that of individuals have certain must exhibit to be effective others attributes in the job Results Quality Focuses on managing the Focuses on customer objective, measurable orientation and prevention results of a job of errors 26. Simple ranking ranks fromYRanking YThe Comparative Approach Alternation ranking - crossing off best and worstYhighest to lowest performer. PairedY Employees are ranked in groups. YForced distribution Yemployees. Managers compare every employee with every other employee in theYcomparison work group. McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. 27. Simple Ranking - rank employees from best toY1. Ranking Alternation Ranking- subjective elimination of worst employees based onYworse. Overall process considered to be subjective.Ybest employee 28. Also requires a ranking format.rankingY2.Forced distribution Manger groups employees into predetermined categories,Ydone in groups. employees are categorized based on distribution rules, not on their performance. Also considered to be subjectiveY 29. Managers compare employee with eachY3. Paired Comparison other in work group/units. Each employee is given a score of 1 for each high Manager computes and compares the number of times score is favorable.Yactivity. Sum of points is employee performance score. 30. Evaluating the Comparative Approach to Measuring Performance Can be an effective tool in differentiating employee performance, eliminatesY Disadvantage is failureYsome rater errors (leniency, distributional errors). Subjective, thereforeYto link with strategic goals of the organisation. Feed back mechanisms excluded.Yvalidity and reliability is dependent on rater. Low acceptance by employees- normative rather than absolute standards used.Y 31. A list ofYGraphic rating scales YThe Attribute Approach Legally questionable.Ytraits is evaluated by a five- point rating scale. Define relevant performance dimensions and then developYMixed-standard scales Y statements representing good, average, and poor performance along each dimension. McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. 32. Easy toY Stillpopular YAdvantages of the Attribute Approach Identifies and defines attributes relevant to jobY Generalize YDevelop Can be reliableYperformance & Yvalid 33. Disadvantages of the Attribute Approach Little congruence between techniques and company strategy Used widely because its easy to use Performance standards vague- reliability/validity low No feedback mechanisms 34. Defines behaviors an employee mustYBehavioral Approach There are 5 techniques used in this approachYexhibit to be effective in the job 35. Criticalincidents approach - requiresYBehavioral Approach managers to keep record of specific examples of effective and ineffective Behavioral observationYBehaviorally anchored rating scales (BARS) Yperformance. Organizational behavior modification - a formal system ofYscales (BOS) Assessment centers - multiple ratersYbehavioral feedback and reinforcement. evaluate employees performance on a number of exercises. McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. 36. Log is kept for recording observableYCritical Incidents behavior demonstrated by an employee that is both effective and ineffective. Log is used to provide feedback to employees and is used as an aid in goal/Y objective setting 37. Variation of BARS ,YBehavioral Observation Scales - (BOS) BOS useful in differentiating good from poorYusing critical incidents BOS is easy to use, butYperformers, objectivity, providing feedback, training. does require more information 38. Expansion of theYBehaviorally Anchored Rating Scales (BARS) critical incidents approach and is used to develop behavioral anchors that Can increase interrater reliability byYdefine different levels of performance. providing precise and complete definition of the performance, however behavioral anchors can bias information recall 39. Four actions in using BARS 1. Define key behaviors 2. Use a measurement system to assess behaviors 3. Inform employee of behaviors to be measured 4. Provide feedback and reinforcement to employee 40. Managing behaviorYOrganizational Behavior Modification (OBM) Uses the behaviorist approachYthrough a system of feedback and reinforcement which indicates that future behavior is influenced by past behaviour that has been positively reinforced 41. Normally used in selection /promotion ,YAssessment Centers Simulations are carried out, multiple ratersYbut also for measuring performance Provide an objective measure of an employees jobYevaluate employee performance Allows for specific feedbackYperformance & individual developmental plans 42. Can be effectiveYAdvantages of the Behavioral Approach Provides specific guidanceYProvides for strategic congruence Y & feedback Behaviors measured are validYfor employees about performance expected of them Raters performance is usually highYAcceptability usually high Y 43. Disadvantages of the Behavioral Approach Weaknesses: Behaviors need to be constantly monitored and revised to ensure strategicY Approach assumes that there is only one way to do the job and thatYcongruence. behaviors are identifiable 44. Behavioral systems are person based outcomes YArguments : employees do not have complete control over these outcomes- may be regarded as contaminated, rather systems factors should be used to evaluate performance. Suggests that: performanceYOutcomes can result in dysfunctional behavior. feedback should given to employees using both objective and subjective feedback Relies onY Employees should not be categorized for performance ratings Y combination of attribute & results for measurement of performance 45. topYManagement by objectives Goals YResults Approach management passes down companys strategic goals to next layer of management, Productivity MeasurementYand these managers define the goals they must achieve. goal is to motivate employees toYand Hierarchy Evaluation System (ProMES) higher levels of productivity. McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. 46. Focuses on managing the objective,YThe Results Approach Management team defines organisationYmeasurable results of a job or workgroup Y Requires specific, difficult objectives Y Goals are cascaded Ystrategy. They effectively linkYSuccess of system dependent on Management commitment employees performance with organization's strategic goals.

47. A goal directed and results oriented approachYWhat is MBO? to performance appraisal in which employees and their managers/supervisors set goals together for the upcoming evaluation period and for and explicit time period 48. Common They require specificYcomponents of the MBO System Goals are set with managers and employees participationYobjective goals Managers provide objective feedback throughout the rating period to monitorY progress towards goals 49. Conditions thatYWhat is an Objective Objectives describe: A time frame duringYwill exist when the desired outcome has been established Resources that the organisation is willingYwhich the outcome is to be completed to commit. 50. AYM Measurable YS Specific YGOOD OBJECTIVES ARE SMART TYR Realistic and results-oriented YAligned with organizational/unit goals Timed 51. What is a Standard? Standards are established criteria used by an organisation to objectively measure the performance of employees. Standards refer to ongoing performance criterion that must be met consistently. 52. Performance Standards A well written performance standard is: 1.Clearly Defined 2. Reliable 3.Valid 53. These standards areYClearly Defined Performance Standards They must alsoYcongruent with the organisations strategy, goals and objectives AttainableYMeasurable YSpecific Ysatisfy the following criteria: (SMART) Time BoundYRealistic Y 54. Refers to the consistency of the performanceYReliability standards and measures 55. Validity refers to the extent to which theYValidity AYperformance standards measure all/only the relevant aspects of performance. performance standard is contaminated whenever it measures irrelevant aspects of A performance standard is deficient if it does not measure allYperformance. aspects of performance. 56. Performance Standards Performance standards are used to Personal biasesYRating Errors YPrejudices Yminimise: 57. Aims to motivateYProductivity Measurement Systems(ProMES) Has measurement and feedbackYemployees to higher levels of production It is effective, in increasing productivityYmechanisms. 58. 4 Steps in the ProMES Process 1. Employees identify the products/activities/objectives to be accomplished by organisation. 2. Staff defines indicators of the product 3. Staff establishes the contingencies between the quantity of the indicator and level of evaluation associated with the amount 4. Feedback system is developed 59. Minimises subjectivity,YAdvantages of the Results Approach HighYobjective and quantifiable indicators of performance are used. Links individual performance to organisation's strategyYacceptability & goals. 60. MeasuresYDisadvantages of the Results Approach Weaknesses: Employees tend to focus on measurable aspectsYcan be contaminated and deficient Feedback may not help employees improve-Yof performance- neglecting others feedback needs to focus on actual behavior that needs to be changed 61. Quality Approach A performance management system designed Emphasize an assessmentYwith a strong quality orientation can be expected to: Emphasize thatYof both person and system factors in the measurement system. InvolveYmanagers and employees work together to solve performance problems. both internal and external customers in setting standards and measuring Use multiple sources to evaluate person and system factors.Yperformance. McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. 62. Statistical process quality controlYQuality Approach (cont.) ParetoY Cause-and-effect diagrams Y Process-flow analysis Ytechniques used: Scattergram McGraw-Hill/Irwin 2006 TheY Histogram Y Control chart Ychart McGraw-Hill Companies, Inc. All rights reserved. 63. Recommendations for designing an Effective Performance System 1. Aim for Precision in defining and measuring performance. 2. Link Performance dimensions to meeting internal and external customer requirements. 3. Measure and correct for the impact of situational constraints. 64. The focus onYCURRENT ISSUES IN PERFORMANCE MANAGEMENT The system is too topYToo much for one rater to appraise Yratings and rewards Total Quality ManagementYTeam-based work systems Ydown 65. Increased employeeYPERFORMANCE MANAGEMENT INNOVATIONS Multi-rater systems (i.e., 360YLess focus on ratings and rewards Yinvolvement degree feedback, peer reviews) 66. Involvement of users inYIMPLEMENTATION ISSUES AND STRATEGIES StaggeredYImplementation in one unit YPilot programs Ydevelopment implementation 67. Lack of commitmentYOBSTACLES TO SUCCESSFUL IMPLEMENTATION A program excessive in paperwork andYOverselling the program Yfrom the top ChangingYFailing to train and retrain appraisers Yadministrative requirements Failing to monitor the program and deal with non- complianceYthe system 68. PERFORMANCE APPRAISAL THE APPRAISAL PROCESS 69. PerformanceZPERFORMANCE APPRAISAL VS PERFORMANCE MANAGEMENT management -- all of those processes led by managers to help employees perform Performance appraisal -- process involvingZas effectively as they can. setting standards, informing employees, assigning ratings and giving feedback. 70. Why Appraise? Appraisal is designed as a means of monitoring the progress and achievement of the organisation ,to encourage and support the continuing development of the organisation in a changing world 71. Objective of Performance Appraisal Performance Appraisal is the systematic evaluation of an individuals job performance which seeks to measure his/her performance in relation to the achievement of an organizations strategy. 72. KnowEffective Characteristics for Managing Performance Demonstrate effective communicationyour organisations performance cycle Ability to develop Be able to explore causes of performance problems skills Be objective andaction plans and empower employee to be solution-oriented Be able to provide feedbackfocus attention towards the problem 73. Sources for Performance Information Supervisors Customers Peers Self Subordinates McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved.

74. Similar to meYRater Errors in Performance Measurement StereotypesYRecency YHalo and horns YDistributional errors YContrast Y Bias McGraw-Hill/Irwin 2006 The McGraw-Hill Companies,YSelective perception Y Inc. All rights reserved. 75. Conduct a valid job analysisYFollowing Legal Guidelines TrainYBase system on specific behaviors or results. Yrelated to performance. Review performance ratings and allow forYraters to use system correctly. Use multipleYProvide guidance/support for poor performers. Yemployee appeal. raters. McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. 76. Two Approaches toYReducing Errors and Appraisal Politics Rater accuracy trainingY Rater error training Yreducing rater error: Appraisal politics - a situation in which evaluators purposefully distortY ratings to achieve personal or company goals. McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. 77. Monitor progressYPurposes of Performance Appraisals & Y Identify training & LinkYachievements of development needs organizations Identify employees current employees activities levelsYstrategic goals with EncourageY Organizational Yof performance & motivate development employees Reward employees planning performanceY Provide for succession Y 78. Identification of skills toYBenefits To the Organization ProactiveYEmployees are motivated Yenhance organizations performance Provides a competitiveYidentification of training and development needs advantage by managing behavior and results of employees. 79. Benefits To The Mana Builds the relationship with theYger Evaluate employees effectivenessY Enhance employees motivation Yemployee Identify trainingYagainst strategic goals & Builds aYdevelopmental needs Provides documentation for legalYrational basis for constructing rewards purposes. 80. Fairness of system measurementYBenefits To The Employee Recognition and rewards for contributions to theYenhances/effects outcomes Y Provides for feedback Y Enables employee to improve performance Yorganization Acts as a motivator toYEnhances communication between employee and manager improve performance 81. ManagersYChallenges Associated With Performance Appraisals Culture of theYare uncomfortable providing feedback Process can be subjective rather thanYorganization/organizational politics Rater Errors can cause bias inYobjective if not properly administered Whether to focus on individual or teamYappraising actual performance. Legal IssuesYperformance 82. Challenges Associated With Performance Appraisals- continued May have limited contact with subordinateY Often resist YManagers/Supervisor: Fear theY Viewed as wasted paperwork Y May be poor at giving feedback. Y Yemotions that can be unleashed and fear being unable to defend the ratings. Dont like giving negative feedback, fear reaction 83. Scheduletime and place forPreparing for Performance Review Review previous Compare performance to standards Assemble data appraisal performance appraisals 84. TellYChoosing a Performance Review Approach & TellYSell & Problem SolvingYListen 85. Appraisal Styles Interview dominated by Managers Interview shared between manager and subordinate Manager tells Manager tells& Sells Manager tells & Listen Manager Shares problems & solutions 86. ShareY Recognize the ones you have. YOVERCOMING BIASES Y Keep a log of events during the year. Yexpectations with the appraisee. Review your draft appraisal withYGive regular feedback (no surprises!). Remind yourself of your biases before every performance appraisalYsomeone. conference. 87. EmpowerYEstablish trust YBe Ready YThe Appraisers Role AgreeingYNegotiating YListen YFind Out Y 88. Be Review purpose of the interview Conducting Appraisal Dont get personal Start out with the positives direct and specific Pay Dont skirt performance issues Encourage mutual communication attention to your non- verbals 89. Recognise that defensiveYHandling Defensive Employees Postpone actionYNever attack a persons defensives Ybehavior s normal Recognise your own limitationsY 90. Y Work or service Teams YAppraisal of Teams Types of teams: Network TeamsYProject Teams 91. How do we assessYChallenges of Team Performance Management How do we balance individual and teamYrelative individual contribution? How do we identify individual and team measures of performance?Yperformance? 92. 3Types of Team Performance 1. Individual performance 2. Individual performance that contributes to team performance 3. Team performance 93. Factors to consider for effective measurement of Teams Key Success Factors- Competencies 1. Communication 2. Decision Making 3. Collaboration Key Accountabilities 1. Goals to be reached 2. Performance standards 94. Appraisal of Teams Using Four dimensions for measurement of team performance: 1. Effectiveness 2. Efficiency 3. Learning and Growth 4. Team Member Satisfaction 95. Performance Feedback Characteristics of an Effective Feedback Process 96. What is Coaching? A directive process by a manager/supervisor to train and orient an employee to the realities of the workplace and to help the employee remove barriers to optimum work performance. Crisp 1989 97. Builds your reputation as a peopleYBenefits of Coaching Increases productivity when employees know what the goals are andYdeveloper Positive recognition and feedback increases employeeYhow to achieve them Avoids surprises and defensiveness in performanceYmotivation and initiative Increases creativity and innovation of unit as employees feel safeYappraisals Increases team cohesiveness due to clarified goals and rolesYto take risks 98. Feedback should be givenYImproving Performance Feedback AskY Create the Right Context for Discussion. Yevery day, not once a year. Encourage theYemployees to rate their performance before the session. Recognize effective performanceYsubordinate to participate in the session. Focus feedback on behavior orY Focus on solving problems. Ythrough praise. Agree to specific goals andY Minimize criticism. Yresults, not on the person. set a date to review progress. McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. 99. They exploreYCharacteristics Shared by Effective Supervisors They direct toYThey direct attention YThey empower worker solutions Ycauses causes communication at performance

100. SolidYManaging Performance of Marginal Performers High ability and motivation; managers should provide developmentYperformers Lack of ability but high motivation;Y Misdirected effort Yopportunities High ability but lackY Underutilizers Ymanagers should focus on training LowY Deadwood Ymotivation; managers should focus on interpersonal abilities ability and motivation; managerial action, outplacement, demotion, firing. McGraw-Hill/Irwin 2006 The McGraw-Hill Companies, Inc. All rights reserved. 101. Y Feedback should be given Frequently YThe Process Create the right context forYEncourage employee to rate his/her performance Encourage employee to participate in discussionYthe discussion 102. Coaching For Improved Performance Critical Discussion Steps Discuss relationship betweenY Clarify discussion purpose Y Set informal tone Y observations & Mutually agreeY Ask for and discuss solutions Yobjectives Express confidence in employee and set next review dateYon necessary actions 103. RecogniseYCoaching For Improved Performance - continued Focus feedback on behavior orYFocus on solving problems Yeffective performance Minimize criticismYresults,not the person 104. Coaching For Improved Performance- continued SETTING Review organizational and unit goals and individual performanceYEXPECTATIONS DescribeY Identify duties,objectives, and projects. Yexpectations.