Chapter 7: Managing Employee Performance

Question 1

When does performance management work best?

Answer 1

Performance management works best when focused on continuous feedback and development. Key is to align performance management system with culture at organizational and societal level.

Question 2

Name the two distinct functions of performance management?

Answer 2

• Administrative: organizations need to evaluate performance to make decisions related to pay rises, promotions etc. This focuses on past performance
• Developmental: employees need high-quality feedback to improve current performance and prepare for new roles. Focuses on future performance

Question 3

What are the three stages of the overall performance management cycle?

Answer 3

1. Defining
2. Evaluating
3. Developing

Question 4

What is the difference between objective and subjective evaluations?

Answer 4

• Objective evaluations focus on job outputs or goal achievements
• Subjective evaluations rely on rater’s judgment.

Question 5

Name five points of effective defining in performance management cycle?

Answer 5

• Best to engage multiple performance indicators and engage multiple stakeholders in evaluation process to get more complete picture
• First define what good performance entails before setting performance goals.
• Goal-setting strategy effective for motivating, increasing persistence and increasing job performance and commitment.
• Let employees engage in setting their own goals as they will be more motivated to achieve them.
• Both set goal and identify a strategy for reaching it. Employees need to know how their behavior can influence their performance metrics.

Question 6

What is organizational citizenship behavior / extra-role performance?

Answer 6

activities valued by organizations but outside of the scope of an employee’s formal job requirements.

Question 7

Name the difference between absolute rating methods and comparative evaluating methods?

Answer 7

• Absolute rating methods: evaluating against some standard or benchmark. Allow equal rating for two employees
• Comparative rating methods: relative rating compared against other employees. Doesn’t allow equal rating.

Question 8

Name three disadvantages of absolute rating methods?

Answer 8

1. Raters apply idiosyncratic standards (graphic rating scales)
2. Limited developmental feedback (graphic rating scales)
3. Need unique scales for individual jobs. (behavioral scales)

Question 9

Name the two advantages of absolute rating methods?

Answer 9

1. Same scale can be used for multiple jobs (graphic rating scales)
2. Explicit behavioral standards/feedback (behavioral scales)

Question 10

What is the main advantages of comparative methods (ranking and forced distributions)?

Answer 10

Good for administrative decisions

Question 10

What are graphic rating scales?

Answer 10

rating for employees requires rater to evaluate employee on series of performance dimensions. Rater chooses a number, category etc. that best describes the employee. Five points is best size of scale.

Question 11

What are the three disadvantages of comparative methods (ranking and forced distributions)?

Answer 11

1. Limited developmental feedback
2. May be perceived as politically motivated or capricious
3. Can generate employee competition and unethical behavior

Question 12

What is a behavioral observation scale?

Answer 12

Behavioral observation scales show how often a behavior is performed (never/occasionally/ consistently etc).

Question 13

What are the advantages of behavioral observation scales?

Answer 13

1. Are usually perceived as fair by employees
2. Provides direct feedback to employee about why they received a particular scale
3. It’s clear what employees need to do to change their rating on the BOS.

Question 14

What is a comparative ranking of employees in performance management system?

Answer 14

raters identify best employee, second-best etc. Has multiple variations.

Question 15

What are the disadvantages of behavioral observation scales?

Answer 15

1. More difficult to develop; not wide adaptation
2. Requires unique rating scale for every job in company.

Question 16

Name the six common rating errors?

Answer 16

1. Leniency error
2. Severity error
3. Central tendency error
4. Halo error
5. Recency error
6. Contrast error
7. Similar-to-me error

Question 16

What is a leniency error?

Answer 16

some raters are easy graders and therefore give high evaluations to all employees regardless of performance.

Question 16

What is a forced distribution performance management system?

Answer 16

constrains the extent to which raters can use specific performance categories.

Question 17

What is severity error?

Answer 17

some raters give all employees scores at low end of performance rating regardless of performance.

Question 17

Name three points of attention for comparative performance management?

Answer 17

1. Works best when They are linked to clear objective criteria known to employees.
2. Can drive employees to compete with colleagues, reducing innovation and motivating unethical behavior
3. Likely to generate feelings of mistrust.

Question 18

What is central tendency error?

Answer 18

rater consistently rates employees at midpoint of scale

Question 19

What is a halo error in performance management?

Answer 19

rater’s evaluation on one performance dimension creates overall positive or negatives impression that drives ratings on other dimensions

Question 20

What is a recency error in performance management?

Answer 20

a rater’s evaluation is heavily influenced by employee’s most recent performance

Question 20

What is the similar-to-me error in performance management?

Answer 20

evaluation is inflated because rater feels personal connection resulting from shared demographics, values or experiences.

Question 21

What is a contrast error in performance management?

Answer 21

rater’s evaluation of average employee is boosted after rating a poor employee, or lowered after rating an excellent employee

Question 22

What is frame-of-reference training?

Answer 22

training that helps raters create a shared understanding of performance evaluation, done by giving raters specific benchmarks as comparison points.

Question 22

Which three things help in encouraging raters to make more accurate judgments?

Answer 22

1. Training
2. Memory aids
3. Accountability

Question 23

What are memory aids?

Answer 23

processes for recording performance information across entire year so that ratings are not heavily influenced by performance events.

Question 23

What is accountability in rating performance?

Answer 23

holding managers accountable will increase data quality emerging from performance evaluation systems. Managers should have written justifications for their evaluations.

Question 24

Which two things make an employee feel like they have been treated fairly?

Answer 24

1. Strong, high-quality relationship between employee and manager
2. Feedforward feedback: feedback and support in developing employee’s past behavior.

Question 25

What is 360-degree feedback?

Answer 25

feedback from multiple stakeholders; makes feedback appear more legit.

Should be given to employees by managers

Question 26

Name three ways to make feedback more effective?

Answer 26

1. Reflect on your own beliefs about your employee’s job performance and abilities.
2. Let employees engage in self-appraisals; will facilitate learning and generate greater change than feedback that comes from a manager.
3. Encourage Employee-generated solutions: agree with employee on solution to problems; encourage employees to explore and experiment with their own solutions.

Question 27

What are the five principles of effective feedback?

Answer 27

1. Engage in 360-degree feedback
2. Daily and weekly feedback for performance improvements
3. Managers should check in regularly and give feedback when employees need it most
4. Give feedback immediately after effective or ineffective feedback
5. Give balanced, specific (task and behavior focused) feedback