Chapter 7: Appraising and Managing Performance

1. Please remember to turn cell phones off and put them away. Chapter 7: Appraising and Managing Performance MGT 3513

2. Announcements • Note: When you are answering questions on these slides, you will need to start towards the middle of the chapter. Look for the section with rater errors. • When you get to the question on relative judgments, you’ll need to go back to close to the beginning of the chapter.

3. Challenges For the Employee • Negative employee reactions • High anxiety for employees • Lead up to difficult conversations For the manager • Time consuming • Avoiding rater biases/being consistent in ratings • Lead up to difficult conversations

4. Questions on the Uses of Performance Appraisal • What are the two main purposes or uses of performance appraisal? • What is a dimension?

5. Benefits Performance reviews are a basis for • Legal defense • Documentation • Administrative decision making • Raises & promotions • Employee development

6. Questions on Rater Errors and Biases • What is a rater error? • Describe halo error • Describe horn error (not in book – Dr. Marler will answer)

7. Questions on Rater Errors and Biases • What are restriction of range errors? • Describe leniency error • Describe severity error • Describe central tendency error

8. Examples - - practice identifying rater errors • Keisha works in medical records and has very high performance. Her manager gives most employees average ratings. What type of error has he made? • Processing speed Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5 • Accuracy of entries Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5 • Correct use of medical terminology Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5

9. Examples - - practice identifying rater errors • Lana is a standout salesperson & leads her department in sales dollars. Her manager Stephan assumes she is excellent is all areas. What type of error has he made? • Sales Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5 • # of new customers Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5 • Timeliness of reports Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5

10. Examples - - practice identifying rater errors • Evan is a computer technician who is generally a low performer. His manager Eve has given him the following ratings. What type of error has she made? • Response time for claims Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5 • Ability to explain problem to system users Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5 • Up-to-date knowledge Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5

11. Examples - - practice identifying rater errors • Tony is a high performing welder. However, his manager gives him and most other workers low ratings. What type of error has been made? • Promptness Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5 • Quality of welds Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5 • Adherence to safety standards Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5

12. Avoiding Rater Errors and Biases • What is meant by comparability? • What is frame-of-reference (FOR) training?

13. Developing performance appraisal items Job Analysis Job Description Performance Appraisal Items

14. Performance Appraisal Relative Judgment Absolute Judgment

15. Performance Appraisal Relative Judgment Absolute Judgment Straight Ranking Narrative Essays Weighted Checklist Paired Comparison Graphic Rating Scale Behavioral Observation Scale Based on critical incidents Forced Distribution Behaviorally Anchored Rating Scale

16. Questions on Measurement Tools • What are relative judgments?

17. Performance Appraisal Relative Judgment Absolute Judgment Straight Ranking Paired Comparison Forced Distribution

18. Example - - Relative Judgments • Jen, Jeff, and James are my employees. I compare Jen’s performance to that of Jeff and James. I also compare Jeff’s performance to James’ performance. I’m using __________________. • If I rank my employees from highest performer to lowest performer, I’m using _________________. • I manage a department of 100 employees. I rank employees, and employees in the top 15 % receive a bonus. In this case, I’m using ________________.

19. Relative Judgments Pro • Easy to use • Force managers to differentiate among workers (i.e., everyone can’t get a good rating) Cons • Force managers to differentiate among workers (i.e., it may not accurately reflect who the good performers are) • Only considers one dimension of performance at a time • Example: Ranking based on quantity produced; Ranking based on quality (e.g., # of errors made)

20. Performance Appraisal Relative Judgment Absolute Judgment

21. Performance Appraisal Relative Judgment Absolute Judgment Straight Ranking Narrative Essays Weighted Checklist Paired Comparison Graphic Rating Scale Behavioral Observation Scale Based on critical incidents Forced Distribution Behaviorally Anchored Rating Scale

22. Questions on Measurement Tools • What are absolute judgments?

23. Absolute Judgments Pro • Consider many dimensions of performance • Can give specific feedback Cons • Difficult & time-consuming to develop • Vulnerable to rating errors

24. Performance Appraisal Relative Judgment Absolute Judgment Scales based on critical incidents Narrative Essays Graphic Rating Scale

25. Narrative Essays • Raters give information in narrative form • Ex. Manager writes an essay describing an employee’s performance. • Cons: • Writing skills of supervisor (may be limited) • Time consuming

26. Narrative Essay Example Please comment on the following aspects of the course: • The organization and delivery of classroom presentations • The instructor’s receptiveness to questions and the clarity of responses • Reading materials and written and oral assignments

27. Graphic Rating Scale • Graphic rating scale can be used to assess both • Traits • Behaviors • Use anchors (e.g., “above average”) • Pros: easy to use • Cons: not much information (too general)

28. Anchors Rate this employee by the quality of his/her work: Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5 Anchor = descriptor above number

29. Graphic Rating Scale Examples Quality of Work: Poor Average Excellent 1 --------- 2 ----------- 3 ------------ 4 ------------ 5 A low rating tell us ___________________ but not ___________________.

30. Performance Appraisal Relative Judgment Absolute Judgment Weighted Checklist Behavioral Observation Scale Based on critical incidents Behaviorally Anchored Rating Scale

31. Scales Based on Critical Incidents • Critical incidents: Examples of good and bad performance • Each job in an organization will have different critical incidents • Examples • http://www.seahawks.com/videos-photos/videos/Highlights-Seahawks-at-Texans/551051a8-ae93-4fe8-af7a-34ffc0320561

32. Weighted Checklist • Generate critical incidents and weight them • Good incidents = positive number (ex. + 1) • Bad incidents = negative number (ex. -1) • Identify which incidents are characteristic of the employee and add up the points • Pros: specific behaviors = greater accuracy • Cons: determining weights

33. Weighted Checklist Example ___(+ 6) Knows the difference between correcting grammar in the boss’s letter and correcting the writing style. ___(+2) Keeps a running count on the use of office supplies. ___(-2) Opens all mail whether or not it is marked “confidential”. ___(-7) Leaves many mistakes in typing from failing to proofread the typed copy. Total Points = _____

34. Behavioral Observation Scale • Generate critical incidents • Assess frequency of behavior • Pros: specific behaviors = greater accuracy • Cons: rater may not see all behaviors

35. BOS Example for a restaurant server Refills water glasses: 0 1 2 3 4 5 6 7 8 Never Sometimes Always Is absent when customers need something: 0 1 2 3 4 5 6 7 8 Never Sometimes Always Confuses customer orders: 0 1 2 3 4 5 6 7 8 Never Sometimes Always

36. Behaviorally Anchored Rating Scale • Assign critical incidents to anchors of a rating scale • Pros: very specific - - greater accuracy • Cons: time consuming to develop

37. BARS Examples 1 Does not do entrée check 2 3 Does entrée check late 4 5 Does entrée check at appropriate time 1 Does not offer dessert 2 3 Offers dessert, but makes no suggestions 4 5 Makes dessert suggestions Notice that anchors are a specific behavior (rather than a descriptor like “average”)

38. Performance Appraisal Relative Judgment Absolute Judgment Straight Ranking Narrative Essays Weighted Checklist Paired Comparison Graphic Rating Scale Behavioral Observation Scale Based on critical incidents Forced Distribution Behaviorally Anchored Rating Scale

39. Questions on Measurement Tools • What is 360-degree feedback? • What main advantage associated with using 360-degree feedback?

41. 360-Degree Feedback • Disadvantages • Confusing for employees • Information overload • Issues with confidentiality

42. Practical tips for Giving Feedback • Feedback should be given _______________ • Focus feedback on _______, not on the person • Don’t use words like “_____” and “____” • Be constructive – discuss _______________