Chapter 7 Flashcards
What is performance appraisal?
Evaluating an employee’s current and/or past performance relative to
performance standards.
What is the 3 step performance appraisal process?
(1) setting work standards, (2) assessing the employee’s actual performance relative to those standards (this often involves some rating form), and (3) providing
feedback to the employee to help eliminate performance deficiencies or to continue to perform above par
True or false: Effective performance appraisals are irrelevant to successful performance management
False: Effective performance appraisals are the basis for successful performance management
Are performance appraisals a difficult task?
Although performance appraisal is a
difficult interpersonal task for managers, it cannot be eliminated
In any organization, achieving strategic objectives requires….
Employee productivity above all else because organizations strive to create a high-performance
culture by using a minimum number of employees
What is the suggested opportunity for organizations regarding performance management?
Better performance management is considered a largely untapped opportunity to improve overall organizational performance.
What challenge do both managers and employees often face during performance appraisals?
Both may feel uncomfortable during the process, making it a difficult interpersonal task.
What is performance management?
The process encompassing all
activities related to improving
employee performance,
productivity, and effectiveness
How does performance management differ from performance appraisals?
Performance management is broader and more strategic, involving various activities to improve employee performance, productivity, and effectiveness, while appraisals are just one part of this system.
What are the key components of performance management?
Goal setting, pay for performance, training and development, career management, and disciplinary action.
How does performance management influence organizational work behavior?
Provides an integrated network of
procedures across the organization that will influence all work behaviour
What are the three major purposes of performance management?
- It aligns employee actions with
strategic goals - It is a vehicle for culture change
- It provides input into other HR
systems such as development and remuneration.
What are two formal appraisal methods
- Comparative methods
- Advanced quantitative methods
What are the 4 comparative methods
- Graphic rating scale
- Alternation ranking method
- Paired comparison method
- Forced distribution method
What is graphic rating scale
A scale that lists a number of traits (such as reliability)and a range of performance for each (from unsatisfactory to outstanding). The employee is then rated by identifying the score that best describes their level of performance for each trait.
Ex. rating uber driver
What is the simplest and most popular technique for appraising performance?
Graphic rating scale
How is the employee rated with the graphic rating scale?
The supervisor rates each employee by circling or checking the score that
best describes their performance for each trait. The assigned values are then totalled.
In a world of constant customer reviews, gig economy workers are often evaluated based on basic rating scales
Instead of appraising generic traits or factors, many firms specify the duties to be appraised, give examples for a payroll coordinator
- Acting as a liaison with accounting and benefits staff.
- Continually updating knowledge on relevant legislation.
- Maintaining payroll records.
- Data entry and payroll calculations.
- Responding to employee inquiries regarding payroll issues
What is alternation ranking method?
Ranking employees from best
to worst on a particular trait
How is the alternation ranking method carried out?
- List all employees to be rated.
- Cross out names of employees not known well enough to rank.
- Identify and rank the highest and lowest performers on the chosen trait.
- Alternate between the next highest and next lowest until all employees are ranked.
Why is the alternation ranking method popular?
It simplifies the ranking process by focusing first on identifying the extremes (best and worst), which is often easier than ranking everyone at once.
What is paired comparison method?
Ranking employees by making
a chart of all possible pairs of
employees for each trait and
indicating the better employee
of the pair.
How does the paired comparison method make ranking more precise?
Makes the ranking process more precise by comparing every employee with every other employee on a specific trait (e.g., quantity of work, quality of work).
How does the paired comparison method work?
A chart is created with all possible pairs of employees for each trait.
For each trait, each pair of employees is compared, and the better employee is marked with a “+” and the other with a “−”.
The number of “+” marks for each employee is tallied to determine their rank on that trait.
What is forced distribution method?
Predetermined percentages of ratees are placed in various performance categories
How was the forced distribution method used at General Electric (GE)?
The late Jack Welch, who was chief executive offi-cer of General Electric (GE), is most often associated with the forced distribution method
At GE, the method followed a bell curve, with the top 10-20% of employees exceeding expectations, the bottom 10% not meeting expectations, and the rest considered the backbone of the workforce, receiving moderate compensation and development.
What are the benefits of the forced distribution method?
It allows for focused effort and resources on top performers, motivating high achievers with higher compensation and advancement opportunities.
What are the main criticisms of the forced distribution method?
criticized as being demotivat-ing because the majority of the workforce are classified as at or below average. One survey found that 77% of employers were at least “somewhat satisfied” with forced ranking, while the remaining 23% were dissatisfied. The biggest complaint: 44% said it damages morale. Forced distribution motivates effort and perhaps performance, but leaves many employees feeling that their appraisals were dysfunctional.
What nickname has been given to the forced distribution method?
It has been referred to as “Rank and Yank.”
What is one of the challenges with forced distribution?
Differentiating meaningfully between the middle 80% of employees, as identifying the top and bottom performers is usually not the main issue.
What additional step is recommended for low-ranked employees in forced distribution?
A committee should review any employee’s low ranking to ensure fairness and avoid arbitrary evaluations.
What are the 2 advanced quantitative methods?
- Behaviourally anchored rating scales (BARS)
- Management by objectives (MBO)
What is the behaviourally anchored rating scale (BARS)?
An appraisal method that aims
to combine the benefits of narratives, critical incidents, and quantified ratings by anchoring a quantified
scale with specific narrative examples of good and poor performance.
What is the purpose of BARS?
The guiding principle to BARS is that elaborating the dimension and rating scale gives raters a uniform interpretation of the types of behaviour being measured.
How is BARS typically structured?
BARS usually involves a scale of nine anchors, though scales with seven and five anchors are also used.
Why are midpoint scales challenging in BARS?
Midpoint scales are harder to standardize compared to extreme scale points, making it difficult to develop uniform interpretations across raters.
How can the development and use of BARS improve inter-rater reliability?
Recent efforts have focused on addressing midpoint scale development to influence inter-rater reliability and inter-rater agreement.
Anchoring all scale levels with clear statements and involving developers in user training can enhance consistent application of the scale, improving reliability and legal defensibility.
Give an example of a BARS for one performance dimension:
“sales skills.”
Look at figure 7.6
Developing a BARS can be more time-consuming than developing other appraisal
tools, such as graphic rating scales. But BARS may also have important advantages:
- A more accurate measure
- Clearer standards
- Feedback
- Independent dimensions
- Consistency
How does BARS provide a more accurate measure?
People who know the job and its requirements better
than anyone else does develop BARS. The result should therefore be a good mea-sure of performance on that job
How does BARS provide clearer standards?
The critical incidents along the scale help to clarify what is meant by “extremely good” performance, “average” performance, and so forth
How does BARS help in providing feedback?
The critical incidents may be more useful in providing feedback to appraisees than simply informing them of their performance rating without providing specific behavioural examples
How does BARS provide independent dimensions?
Systematically clustering the critical incidents into five or six performance dimensions (such as “knowledge and judgment”) should help to make the dimensions more independent of one another. For example, a rater
should be less likely to rate an employee high on all dimensions simply because the employee was rated high in “conscientiousness.”
How does BARS provide consistency?
BARS evaluations also seem to be relatively consistent and reliable
in that different raters’ appraisals of the same person tend to be similar.
What is management by objectives (MBO)?
Requires the manager and employee to jointly set specific measurable
goals and periodically discuss progress toward these goals, aligned with a comprehensive, organization-wide goal-setting and appraisal program
Give an example of MBO being used.
Google’s CEO sets company-wide “OKRs” (objectives and key results) quarterly. All Google employ-ees then make sure their own goals are in synch with the CEO’s. All employees’ goals are posted on Google’s internal website next to their names.
What happens when managers and employees set goals collaboratively?
Employees become more engaged and committed to the goal, leading to a higher rate of success.
What is the benefit of difficult (stretch) goals in professional development?
Increase personal growth and professional development and improve organizational
effectiveness
What risk is associated with goals that push employees too far beyond their abilities?
Goals that are too challenging may result in burnout.
What is crucial for motivating employee performance through goals?
Objectives must be fair and attainable
What are the 6 steps to setting goals in an organization?
- Set the organization’s goals
- Set departmental goals
- Discuss departmental goals
- Define expected results (set individual goals)
- Performance reviews: measure results
- Provide feedback
What are the 3 potential problems in using MBO?
- Setting unclear, unmeasurable objectives
- Time-consuming
- Tug of war
How is setting unclear, unmeasurable objectives an issue for using MBO?
Is the main issue.
Such an objective as “will do a better job of training” is useless. Conversely, “will have four employees promoted during the year” is a measurable
objective
How is time consuming an issue in using MBO?
Taking the time to set objectives, measure progress, and provide feedback can take several hours per employee per year, over and above the time already spent doing each person’s appraisal.
How is tug of war an issue in using MBO?
Setting objec-tives with an employee sometimes turns into a tug of war; managers push for higher
goals and employees push for lower ones. It is thus important to know the job and the person’s ability.
Is there one best solution for all performance management systems?
Ultimately, no one single solution is best for all performance management systems. Most firms combine several appraisal techniques.
What are examples of mixing appraisal techniques?
- The graphic rating scale with behavioural incidents defines values for the traits being measured.
- The quantifiable ranking method permits comparisons of employees and is therefore useful for making salary, transfer, and promotion decisions.
- The critical incidents provide specific examples of performance relative to expectations and can be used to develop the high and low anchors for the BARS technique
What factors determine which appraisal methods an organization should use?
RESOURCE CONSTRAINTS (time, money, people) and ORGANIZATIONAL FACTORS (budget, turnover, strategy) will help determine which of the options is best for each organization
Why is appraising employees’ performance challenging for managers?
It is fraught with peril because employees tend to be overly optimistic about their ratings, and their career progress, raises, and peace of mind often depend on those ratings.
What emotional component is involved in performance appraisals?
Honest appraisals can trigger emotional responses, making it difficult for managers who lack formal appraisal discussion skills.
