L9 - Employee Performance Management.pptx

performance

1. Employee Development Scheme Training and Development Performance Management Systems

2. Performance Management Systems

3. Basic Concept

4. Employee performance appraisal involves several aspects. These include the following. The processes and procedures of evaluating performance in the job Regular assessments to determine how well the employee is doing Records and discussions of performance levels Central HR control and co-ordination The resultant findings used in other HRM areas (e.g. HRP, training)

5. Tensions What should the HR system measure? Measuring past performance versus future potential . Performance appraisal generally looks more to the past and performance management tends to look more forward in an active way. Different schools of thought which emphasize the importance of methods, systems and procedures versus the skills of managers Closed systems and open systems i.e. should the employee know his performance appraisal? Organizations sometimes gather performance data by means such as ‘mystery customers’ and computer monitoring. There are ethical issues in this type of data gathering such as the question of whether there are rights to privacy at work. This is especially important as appraisal is normally considered to be built on trust.

6. Methods and Techniques Work standards This is one of the simplest methods. Employees judged by the number of units of output produced over a given period. Comment boxes With this method the appraiser answers questions about the performance of the employee. Often the appraiser is not required to grade the appraisee according to predetermined scales. Describe in own words. Found in Asia with reluctance. Checklists This requires the appraiser to check off ‘yes’ or ‘no’ to questions about the appraisee concerning various aspects of employee performance. Ranking Here there is less discretion for the appraiser, who must place in rank order, from highest to lowest performing, all those employees being appraised. This is resisted as a method in parts of Asia.

7. Scale for Alternate Ranking of Appraisee Ranking

8. Forced Distribution Appraisers rate people on a forced distribution of categories – for instance, 10 per cent low; 20 per cent low average; 40 per cent average; 20 per cent high average; 10 per cent high. Methods and Techniques

9. Forced Distribution Example

10. Forced Distribution

11. Rating scales Here various attributes of performance are listed (for example, accuracy, knowledge, quality of work) and the person is evaluated on each of these dimensions individually A scale is often used. An overall score is then calculated. When formal appraisal systems are used in Asia, this is one of the oldest and most popular methods.

12. Graphic Rating Scale

13. Critical incidents This method is a procedure for collecting observed incidents that are seen as important or critical to performance. A list (or log) of incidents is compiled, with details of examples of positive and negative employee performance recorded and kept. High-performing employees are identified as those performing well during many critical incidents.

14. Examples of Critical Incidents for Assistant Plant Manager Continuing Duties Targets Critical Incidents Schedule production for plant 90% utilization of personnel and machinery in plant; orders delivered on time Instituted new production scheduling system; decreased late orders by 10% last month; increased machine utilization in plant by 20% last month Supervise procurement of raw materials and on inventory control Minimize inventory costs while keeping adequate supplies on hand Let inventory storage costs rise 15% last month; over-ordered parts “A” and “B” by 20%; under-ordered part “C” by 30% Supervise machinery maintenance No shutdowns due to faulty machinery Instituted new preventative maintenance system for plant; prevented a machine breakdown by discovering faulty part Critical Incidents

15. Behaviorally anchored rating scales (BARS) These appraisal methods specify definite, observable and measurable behavior. The format uses critical incidents to serve as ‘anchor statements ’ on a scale. The form contains defined performance dimensions, each with critical incident anchors (examples of actual behavior on the job, not general descriptions or traits). The appraiser then rates the person against these predetermined factors . Management by objectives (MBO) This method was traditionally used more for professional and managerial grades, but is still found in many organizations at lower levels. Methods and Techniques

16. Example of a Behaviorally Anchored Rating Scale for the Dimension Salesmanship Skills Behaviorally Anchored Rating Scale (BARS)

17. Behaviorally Anchored Rating Scale (BARS)

18. Tool Advantages Disadvantages Graphic rating scale Simple to use; provides a quantitative rating for each employee. Standards may be unclear; halo effect, central tendency, leniency, bias can also be problems. BARS Provides behavioral “anchors.” BARS is very accurate. Difficult to develop. ranking Simple to use (but not as simple as graphic rating scales). Avoids central tendency and other problems of rating scales. Can cause disagreements among employees and may be unfair if all employees are, in fact, excellent. Forced distribution method End up with a predetermined number or % of people in each group. Employees’ appraisal results depend on your choice of cutoff points. Critical incident method Helps specify what is “right” and “wrong” about the employee’s performance; forces supervisor to evaluate subordinates on an ongoing basis. Difficult to rate or rank employees relative to one another. MBO Tied to jointly agreed-upon performance objectives. Time-consuming. Comparison of Tools

19. Potential Problems

20. Readings International Comparison in performance appraisal-Reading Performance Management in China- Text2 page 216 to 218 Rawayeti Foods- Case Study (Pakistan)

21. Q&A