5 Criteria of Performance Measures

1. 5 Criteria of Performance Measures 8-1

2. Measuring Performance • Comparative approach compares performance with that of others. • Ranking • Simple ranking ranks employees from highest to lowest performer. • Alternation ranking is crossing off the best and worst employees. • Forced distribution is employees ranked in groups. • Paired comparison • Managers compare every employee with every other employee in work group. 8-2

3. Attribute Approach • Graphic rating scales • list of traits evaluated by 5-point rating scale. • legally questionable. • Mixed-standard scales • define relevant performance dimensions • develop statements representing good, average, and poor performance along each dimension. 8-3

4. Behavioral Approach • Critical incidents approach requires managers to keep record of specific examples of effective and ineffective performance. • Behaviorally anchored rating scales (BARS) • Behavioral observation scales (BOS) • Organizational behavior modification is aformal system of behavioral feedback and reinforcement. • Assessment centers are multiple raters who evaluate employees’ performance on a number of exercises. 8-4

5. Results Approach Goals • Management by Objectives • top management passes down company’s strategic goals to managers to define goals. • Productivity Measurement and Evaluation System (ProMES) • goal is to motivateemployees to higher levels of productivity. Hierarchy 8-5

6. 5 Performance Information Sources Managers Customers Peers Subordinates Self 8-6

7. Reducing Rater Errors and Politics • Approaches to Reducing Rater Error: • Rater error training • Rater accuracy training • Calibration Meetings- attended by managers to discuss employee performance ratings. 8-7

8. Typical Rater Errors • Similar to Me • Contrast • Leniency • Strictness • Central Tendency • Halo • Horns Appraisal Politics- evaluations distort ratings to achieve goals. 8-8

9. Improve Performance Feedback • Give feedback frequently, not once a year. • Create right context for discussion. • Ask employees to rate performance before the session. • Encourage employee to participate. • Recognize effective performance through praise. • Focus on solving problems. • Focus feedback on behavior or results, not on the person. • Minimize criticism. • Agree to specific goals and set progress review date. 8-9

10. Input Employee Characteristics 5 Factors to Consider When Analyzing Poor Performance Performance Standards/ Goals Consequences Feedback 8-10

11. Ways to Manage Performance • Solid performers • High ability and motivation; provide development • Misdirected effort • Lack of ability but high motivation; focus on training • Underutilizers • High ability but lack motivation; focus on interpersonal abilities • Deadwood • Low ability and motivation; managerial action, outplacement, demotion, firing 8-11

12. Withstand Legal Scrutiny • Conduct a valid job analysis related to performance. • Base system on specific behaviors or results. • Train raters to use system correctly. • Review performance ratings and allow for employee appeal. • Provide guidance/support for poor performers. • Use multiple raters. • Document performance evaluations. 8-12

13. Summary Measuring and managing performance are key to gaining competitive edge. • Performance management systems (PMS) serve strategic, administrative and developmental purposes. • PMS should be evaluated against criteria of strategic congruence, validity, reliability, acceptability and specificity. • Effective managers need to • be aware of the issues involved in determining best methods. • feed performance information back to employees • take action based on causes for poor performance: ability, motivation or both • be sure that PMS can meet legal scrutiny 8-13