Organizational
Resource
Management
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ORM 4: Nov-2012
Westford School of Management – All rights reserved
Performance Appraisal and
Performance Management
Comparing Performance Appraisal and Performance
Management
• Performance appraisal
– Evaluating an employee’s current and/or
past performance relative to his or her
performance standards.
• Performance management
– The process employers use to make sure
employees are working toward
organizational goals.
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rights reserved.
Why Performance Management?
• The popularity of the total quality management
(TQM) concepts.
• The necessity in today’s globally competitive
industrial environment for every employee’s
efforts to focus on helping the company to
achieve its strategic goals.
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rights reserved.
9–4
An Introduction to Appraising
Performance
• Why appraise performance?
– Appraisals play an integral role in the
employer’s performance management process.
– Appraisals help in planning for correcting
deficiencies and reinforce things done correctly.
– Appraisals, in identifying employee strengths
and weaknesses, are useful for career planning
– Appraisals affect the employer’s salary raise
decisions.
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rights reserved.
9–5
Classroom
Teaching
Appraisal By
Students
Source: Richard I. Miller, Evaluating Faculty
for Promotional and Tenure (San Francisco:
Jossey-Bass Publishers, 1987), pp. 164–165.
Copyright © 1987, Jossey-Bass Inc.,
Publishers. All rights reserved. Reprinted with
permission.
© 2005 Prentice Hall Inc. All
rights reserved.
Figure 9–1
9–6
Performance Appraisal Roles
• HR department
– Serves a policy-making and advisory role.
– Provides advice and assistance regarding the
appraisal tool to use.
– Prepares forms and procedures and insists that all
departments use them.
– Responsible for training supervisors to improve
their appraisal skills.
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9–7
Steps in Appraising Performance
• Defining the job
– Making sure that you and your subordinate agree
on his or her duties and job standards.
• Appraising performance
– Comparing your subordinate’s actual performance
to the standards that have been set; this usually
involves some type of rating form.
• Providing feedback
– Discussing the subordinate’s performance and
progress, and making plans for any development
required.
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9–8
Designing the Appraisal Tool
• What to measure?
– Work output (quality and quantity)
– Personal competencies
– Goal (objective) achievement
• How to measure?
– Graphic rating scales
– Alternation ranking method
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9–9
Performance Appraisal Methods
• Graphic rating scale
– A scale that lists a number of traits and a
range of performance for each that is used to
identify the score that best describes an
employee’s level of performance for each
trait.
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9–10
Graphic
Rating Scale
with Space
for
Comments
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rights reserved.
Figure 9–3
9–11
Portion of an Administrative Secretary’s Sample
Performance Appraisal Form
Source: James Buford Jr., Bettye Burkhalter, and Grover Jacobs, “Link Job Description
to Performance Appraisals,” Personnel Journal, June 1988, pp. 135–136.
© 2005 Prentice Hall Inc. All
rights reserved.
9–12
Figure 9–4
FIGURE 9–5
Appraisal Form for Assessing Both Competencies and Specific Objectives
Source:
Accessed May 17, 2007.
© 2008http://www.case.edu/finadmin/humres/policies/perfExempt.pdf.
Prentice Hall, Inc. All
rights reserved.
9–13
Performance
Management Outline
Source: www.cwru.edu.
© 2005
Prentice Hall Inc. All
rights reserved.
Figure 9–5a
9–14
Performance
Management
Outline
(cont’d)
Source:
www.cwru.edu.
© 2005
Prentice
Hall Inc. All
rights reserved.
Figure 9–5b
9–15
Performance
Management
Outline (cont’d)
Source:
www.cwru.edu.
© 2005
Prentice
Hall Inc. All
rights reserved.
Figure 9–5c
9–16
Performance Appraisal Methods
(cont’d)
• Alternation ranking method
– Ranking employees from best to worst on a
particular trait, choosing highest, then lowest,
until all are ranked.
• Paired comparison method
– Ranking employees by making a chart of all
possible pairs of the employees for each trait
and indicating which is the better employee of
the pair.
© 2005 Prentice Hall Inc. All
rights reserved.
9–17
Alternation Ranking Scale
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rights reserved.
Figure 9–6
9–18
Ranking Employees by the
Paired Comparison Method
Note: + means “better than.” − means “worse than.” For each chart, add up the
number of 1’s in each column to get the highest-ranked employee.
© 2005 Prentice Hall Inc. All
rights reserved.
Figure 9–7
9–19
ACTIVITY 1
WHAT ARE THE
DISADVANTAGES TO THE
EMPLOYEE OF NOT HAVING AN
APPRAISAL SYSTEM?
PURPOSE OF APPRAISAL
SYSTEMATIC APPROACH TO APPRAISAL
1. IDENTIFICATION OF CRITERIA FOR ASSESSMENT.
2. THE PREPARATION OF AN APPRAISAL REPORT.
3. AN APPRAISAL INTERVIEW, FOR AN EXCHANGE
OF VIEWS ABOUT THE RESULTS OF THE
ASSESSMENT, TARGETS FOR IMPROVEMENT,
SOLUTIONS TO PROBLEMS, ETC.
4. THE PREPARATION & IMPLEMENTATION OF
ACTION PLANS TO ACHIEVE IMPROVEMENTS &
CHANGES AGREED.
5. FOLLOW-UP: MONITORING THE PROGRESS OF
THE ACTION PLAN.
APPRAISAL PROCEDURES
& TECHNIQUES
SOURCES OF PERFORMANCE
FEEDBACK
1. SELF APPRAISAL. Evaluation of
employee
2. UPWARD APPRAISAL. Evaluation of
boss
3. CUSTOMER APPRAISAL.
LATERAL THINKING
Nutty Problem
• A man is replacing a wheel on his car,
when he accidentally drops the four
nuts used to hold the wheel on the
car, and they fall into a deep drain,
irretrievably lost. A passing girl offers
him a solution which enables him to
drive home. What is it?
Reward Management
REWARD MANAGEMENT
• Motivation
– The willingness to exert high levels of effort to reach
organizational goals, conditioned by the effort’s ability to
satisfy some individual need
• Need
– An internal state that makes certain outcomes appear
attractive
• CONTENT THEORIES: WHAT MOTIVATES PEOPLE?
E.G. MASLOW & HERZBERG THEORIES.
•
PROCESS THEORIES: HOW ARE PEOPLE MOTIVATED?
E.G. EXPECTANCY THEORY.
Components
of Motivation
Motivation
Effort
Organizational
Goals
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Hall, Inc. All rights reserved.
Needs
10–26
The Motivation Process
Exhibit 10.1
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Hall, Inc. All rights reserved.
10–27
Early Theories Of Motivation
• Hierarchy of needs theory (Maslow)
– There is a hierarchy of five human needs; as each need
becomes satisfied, the next need becomes dominant.
• Physiological: food, drink, shelter, sex
• Safety: physical safety
• Social: affiliation with others, affection, friendship
• Esteem: Internal (self-respect, autonomy, and
achievement); external (status, recognition, and attention)
• Self-actualization: personal growth and fulfillment
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Hall, Inc. All rights reserved.
10–28
Maslow’s Hierarchy of Needs
Source: Motivation and Personality, 2nd ed., by A. H. Maslow, 1970.
Reprinted by permission of Prentice Hall, Inc., Upper Saddle River, New Jersey.
Copyright © 2005 Prentice
Hall, Inc. All rights reserved.
10–29
Exhibit 10.2
Early Theories Of Motivation
(cont’d)
• Motivation-Hygiene theory (Herzberg)
– Intrinsic factors are related to job satisfaction and
extrinsic factors are related to job dissatisfaction
• Hygiene factors
– Factors, such as working conditions and salary, that,
when adequate, may eliminate job dissatisfaction but do
not necessarily increase job satisfaction.
• Motivators
– Factors, such as recognition and growth, that can increase
job satisfaction.
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Hall, Inc. All rights reserved.
10–30
Herzberg’s Motivation-Hygiene Theory
Exhibit 10.4
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Hall, Inc. All rights reserved.
10–31
Contrasting Views of
Satisfaction-Dissatisfaction
Exhibit 10.5
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Hall, Inc. All rights reserved.
10–32
Expectancy Theory (Vroom)
• A comprehensive theory of motivation that an
individual tends to act in a certain way, in the
expectation that the act will be followed by given
outcome, and according to the attractiveness of that
outcome to the individual.
– The extent to which individuals are motivated to
perform to get a reward of value to them is based
on their belief that their performance will result in
the reward they want.
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Hall, Inc. All rights reserved.
10–33
Expectancy Theory (cont’d)
• Emphasizes self interest in the alignment
of rewards with employee wants.
• Addresses why employees view certain
outcomes (rewards) as attractive or
unattractive.
• Emphasizes the connections among
expected behaviors, rewards, and
organizational goals.
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Hall, Inc. All rights reserved.
10–34
Expectancy Relationships
(Linkages)
• Effort–performance
– The perceived probability that exerting a given
amount of effort will lead to performance
• Performance–reward
– The belief that performing at a particular level
will lead to the attainment of a desired outcome
• Attractiveness
– The importance placed on the potential
outcome or reward that can be achieved on the
job.
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Hall, Inc. All rights reserved.
10–35
ACTIVITY 5
DOES YOUR COMPANY, OR A COMPANY
YOU ARE AWARE OF CARRY OUT JOB
EVALUATION AS A BASIS FOR AN
EQUITABLE REMUNERATION SYSTEM IN
THE COMPANY?
WHAT CAN BE THE ADVANTAGES/
DISADVANTAGES OF JOB EVALUATION?
Organizational Culture
16–37
What Is Organizational
Culture?
Organizational Culture
A common perception
held by the organization’s
members; a system of
shared meaning.
Characteristics:
1. Innovation and risk
taking
2. Attention to detail
3. Outcome orientation
4. People orientation
5. Team orientation
6. Aggressiveness
7. Stability
16–38
Do Organizations Have Uniform
Cultures?
Core Values
The primary or dominant values that are accepted
throughout the organization.
Strong Culture
A culture in which the core values are intensely held
and widely shared.
16–39
How Employees Learn
Culture
• Stories
• Rituals
• Material Symbols
• Routine Behaviours
16–40
Job Enrichment Model
Job Enrichment Model
Identifies five job
characteristics and their
relationship to personal
and work outcomes.
Characteristics:
1. Skill variety
2. Task identity
3. Task significance
4. Autonomy
5. Feedback
7–41