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Employee Performance
Bohlander | Snell
1–1
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Chapter Objectives
After studying this chapter, you should be able to
LEARNING OUTCOME 2 Explain the purposes of performance appraisals and the reasons
they sometimes fail.
LEARNING OUTCOME 4 Explain the various methods used to evaluate the performance of
employees.
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36
Performance Appraisal and Other
HRM Functions
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Performance Appraisal Programs
• Performance Appraisal
A process, typically performed annually by a
supervisor for a subordinate, designed to help
employees understand their roles, objectives,
expectations, and performance success.
• Performance Management
The process of creating a work environment in which
people can perform to the best of their abilities.
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Ongoing Performance Feedback
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Performance Appraisal Programs
Appraisal Programs
Administrative Developmental
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Purposes of a Performance Appraisal
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Reasons Appraisal Programs
Sometimes Fail
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Let Me Count the Ways
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Managerial Issues Concerning Appraisals
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Managerial Issues Concerning Appraisals (cont.)
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Developing an Effective Appraisal Program
• Performance Standards
Must be based on job-related requirements derived
from job analysis and reflected in job description and
job specifications.
Help translate an organization’s goals and objectives
into job requirements that define acceptable and
unacceptable performance levels.
• Calibration
A process whereby managers meet to discuss the
performance of individual employees to ensure their
employee appraisals are in line with one another
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Establishing Performance Standards
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What Are the Performance Standards?
Performance Standards Characteristics
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Are You Complying with the Law?
• Brito v Zia
The Supreme Court ruled that performance appraisals
were subject to the same validity criteria as selection
procedures.
• Albemarle Paper Company v Moody
The U.S. Supreme Court found that employees had
been ranked against a vague standard, open to each
supervisor’s own interpretation.
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Legal Guidelines for Appraisals
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Alternative Sources of Appraisal
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Sources of Performance Appraisal
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Sources of Performance Appraisal (cont.)
• Peer Appraisal
Appraisal by fellow employees, compiled into a single
profile for use in an interview conducted by the
employee’s manager.
Why peer appraisals are not used more often:
1. Peer ratings are simply a popularity contest.
2. Managers are reluctant to give up control over the
appraisal process.
3. Those receiving low ratings might retaliate against
their peers.
4. Peers rely on stereotypes in ratings.
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Sources of Performance Appraisal (cont.)
• Team Appraisal
Based on TQM concepts; recognizes team
accomplishment rather than individual performance
• Customer Appraisal
A performance appraisal that, like team appraisal, is
based on TQM concepts and seeks evaluation from
both external and internal customers
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Pros and Cons of 360-Degree Appraisal
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360-Degree Performance Appraisal System
Integrity Safeguards
• Assure anonymity
• Make respondents accountable
• Prevent “gaming” of the system
• Use statistical procedures
• Identify and quantify biases
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Training Appraisers
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Training Performance Appraisers
Similar-to-me errors
Recency errors
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Rater Errors
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Rater Errors (cont.)
• Contrast Error
A rating error in which an employee’s evaluation is
biased either upward or downward because of
comparison with another employee just previously
evaluated.
• Similar-to-Me Error
An error in which an appraiser inflates the evaluation
of an employee because of a mutual personal
connection.
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Rater Errors: Training and Feedback
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Performance Appraisal Methods
Graphic Rating
Scale
Mixed Standard
Scale
Trait
Methods
Forced-Choice
Essay
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Trait Methods
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Trait Methods (cont.)
• Forced-Choice Method
Requires the rater to choose from statements
designed to distinguish between successful and
unsuccessful performance.
1. ______ a) Works hard _____ b) Works quickly
2. ______ a) Shows initiative _____ b) Is responsive to customers
3. ______ a) Produces poor quality _____ b) Lacks good work habits
• Essay Method
Requires the rater to compose a statement describing
employee behavior.
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Trait Methods
• Forced-Choice Method
Requires the rater to choose from statements
designed to distinguish between successful and
unsuccessful performance.
1. ______ a) Works hard _____ b) Works quickly
2. ______ a) Shows initiative _____ b) Is responsive to customers
3. ______ a) Produces poor quality _____ b) Lacks good work habits
• Essay Method
Requires the rater to compose a statement describing
employee behavior.
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Behavioral Methods
Critical Incident
Behavioral Checklist
Behavioral
Methods
Behaviorally Anchored
Rating Scale (BARS)
Behavior Observation
Scale (BOS)
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Behavioral Methods (cont.)
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Behavioral Methods (cont.)
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Results Methods
• Productivity Measures
Appraisals based on quantitative measures
(e.g., sales volume) that directly link what employees
accomplish to results beneficial to the organization.
– Criterion contamination
– Focus on short-term results
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Performance Appraisal Under an MBO Program
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Creating an Effective MBO Program
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The Balanced Scorecard
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Summary of Appraisal Methods
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Appraisal Interviews
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Appraisal Interview Guidelines
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Factors That Affect an Employee’s Performance
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Performance Diagnosis
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Managing Ineffective Performance
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Key Terms
Describe the different sources of appraisal information. Do you think as an employee you would be in a good position to
3 appraise your boss? What aspects of his or her performance might you
be in a good position to appraise?
Explain the various methods used to evaluate the As an employee, would you rather be evaluated on your personal traits
4 performance of employees. or characteristics, your on-the-job behaviors, or the results you get?
Would it depend upon the job you were doing?
Outline the characteristics of an effective performance As a manager, how might you get an employee who is reluctant to talk
5 appraisal interview. during an appraisal to share his or her thoughts?
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