Human
Resource
Management
Performance
Management
and Appraisal
Chapter 10
Robert L. Mathis | John H. Jackson | Sean
R. Valentine
14e
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Web site, in whole or in part.
Performance Management versus
Performance Appraisal
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Web site, in whole or in part.
The Nature of Performance
Management
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Web site, in whole or in part.
Figure 10.2 - Components of a
Performance-Focused Culture
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Web site, in whole or in part.
Identifying and Measuring Employee
Performance
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Web site, in whole or in part.
Figure 10.3 - Types of Performance
Information
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Web site, in whole or in part.
Performance Standards
 Define
the expected levels of employee
performance
 Should
be realistic, measurable, and clearly
understood

Benefit both organizations and employees
 Ensure
that everyone involved knows the
levels of accomplishment expected
 Can

be both numerical and non-numerical
Assessing non numerical standards can be difficult
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Web site, in whole or in part.
Figure 10.4 - ACTFL Performance
Standards for Speaking Proficiency
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Web site, in whole or in part.
Difficulties in Measuring Service
Performance
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Web site, in whole or in part.
Performance Appraisals
 Assess
an employee’s performance
 Provide
 Help
a platform for feedback
administering wages and salaries
 Help
identifying individual employee
strengths and weaknesses
 Provide
 Help
answers to work-related questions
improve job performance
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Web site, in whole or in part.
Figure 10.5 - Uses for Performance
Appraisals
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Web site, in whole or in part.
Decisions About the Performance
Appraisal Process
Designing Appraisal Systems
Appraisal
Responsibilitie
s
Informal vs.
Systematic
Processes
Timing of
Appraisals
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Web site, in whole or in part.
Figure 10.6 - Typical Division of HR
Responsibilities: Performance Appraisal
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Web site, in whole or in part.
Who Conducts Appraisals?
Supervisors rating
their employees
Multisource or
360° feedback
Sources of
Performance
Appraisals
Outside sources
rating employees
Employees rating
their superiors
Team members
rating each other
Employees rating
themselves
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Web site, in whole or in part.
Figure 10.7 - Multisource Appraisal
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Web site, in whole or in part.
Category Scaling Methods
 Graphic
rating scale: Allows the rater to mark
an employee’s performance on a continuum
indicating low to high levels of a particular
characteristic
10–16
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Category Scaling Methods
Aspects of Performance
Measured
Descriptive
Categories
Job
Duties
Behavioral
Dimensions
10–17
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Web site, in whole or in part.
Category Scaling Methods
 Behaviorally

Anchored Rating Scale (BARS)
Composed of job dimensions (specific descriptions
of important job behaviors) that anchor
performance levels on the scale
 Developing
a BARS

Identify important job dimensions

Write short statements of job behaviors

Assign statements (anchors) to job dimensions

Set scales for anchors
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Web site, in whole or in part.
Figure 10.10 - Behaviorally-Anchored
Rating Scale for Customer Service Skills
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Web site, in whole or in part.
Comparative Methods
 Ranking:
Listing of all employees from highest
to lowest in performance

Drawbacks
 Does
not show size of differences in performance
between employees
 Implies
that lowest-ranked employees are
unsatisfactory performers
 Becomes
an unwieldy process if the group to be
ranked is large
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Web site, in whole or in part.
Comparative Methods
 Forced
distribution: Causes ratings of
employees to be distributed along a bellshaped curve
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Forced Distribution
Advantages
Disadvantages
• Helps deal with “rater inflation”
• Managers resist placing people in
the lowest or highest groups
• Explanation for placement can be
difficult
• Performance may not follow
normal distribution
• Managers may make false
distinctions between employees
• Makes manages identify high,
average, and low performers
• Ensures that compensation
increases reflect performance
differences among individuals
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Web site, in whole or in part.
Figure 10.11 - Forced Distribution on a
Bell-Shaped Curve
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Web site, in whole or in part.
Narrative Methods
 Critical
incident - Manager keeps a written
record of highly favorable and unfavorable
employee actions

Drawbacks
 Variations
 Time
in how managers define a critical incident
involved in documenting employee actions
 Most
employee actions are not observed and may
become different if observed
 Employee
concerns about manager’s black books
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Narrative Methods
 Essay
- Manager writes a short essay
describing an employee’s performance

Drawback - Depends on the supervisors’ writing skills
and their ability to express themselves
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Management by Objectives (MBO)
 Management
by objectives: Performance
appraisal method that specifies the
performance goals that an individual and
manager identify together
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Stages in the MBO Process
1. Job review and
agreement
2. Development of
performance standards
3. Setting of objectives
4. Continuing performance
discussions
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Training Of Managers And Employees
in Performance Appraisal
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Types of Rater Errors
 Varying
standards
 Recency
 Central
errors
 Rater
 Halo
and primacy effects
tendency, leniency, and strictness
bias
and horns effects
 Contrast
error
 Similar-to-me/different-from-me
errors
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Web site, in whole or in part.
Effective Performance Management
Consistent with the
strategic mission
Effectively
documents
performance
Effective
Performance
Management
System
Viewed as fair by
employees
Beneficial as a
development tool
Useful as an
administrative tool
Is legal and job
related
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Web site, in whole or in part.