HRMT 301 Lecture Notes - Lecture 6: Performance Appraisal, Employee Retention, Performance Improvement

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Unit 6: Performance Management
Study Guide Questions
1. What purposes does performance management serve?
- The tetook otes that the pupose of pefoae aageet is to esue that eploees’ atiities
ad outputs otiute to the ogaizatio’s goals “tee et al., , p. 7. This pupose is etail
consistent with the purpose of other HR functions that we have examined so far in the course. Evaluating
and changing the behaviour of workers is a challenging process because relatively high stakes are involved
for the organization and for the worker, and because performance assessment is subjective.
- As ith othe HR futios, aligig eploees’ atiities ad outputs a eate esistae aog
employees. This suggests that in addition to considering the techniques of performance evaluation, it is
useful to consider why and how employees may resist performance management and what happens when
performance management is unsuccessful.
- Performance management is the process through which managers esue that eploees’ atiities ad
outputs otiute to the ogaizatio’s goals. This poess euies koig hat atiities ad outputs ae
desired, observing whether they occur, and providing feedback to help employees meet expectations. In the
course of providing feedback, managers and employees may identify performance issues and establishing
ways to resolve those issues.
- Effective performance management can tell top performers that they are valued, encourage
communications between managers and their employees, and help the organization identify its strongest
performers
- According to the Hay Group, companies on its Global Most Admired list, which it prepares for Fortune
agazie, hae CEO’s ho udestad that pefoae easueet helps the oganization motivate
people and link performance to rewards.
- Ogaizatio’s estalish pefoae aageet sstes to eet thee oad puposes: stategi,
administrative, and development (pg. 175)
Strategic purpose means effective performance management helps the organization achieve its
usiess ojeties. It does this  helpig to lik eploees’ ehaiou ith the ogaizatio’s
goals. Performance management can achieve its strategic purpose only when measurements are
truly aligned with the organizatio’s goals ad he the goals ad feedak aout pefoae ae
communicated to employees.
Ex. A system where employees and managers meet to agree on several personal
objectives through which each employee will help meet the objectives of his/her
department. Together, they identify whatever training the employee needs and meet
egulal to disuss the eploee’s pogess i eetig the ojeties
The administrative purpose of a performance management system refers to how organizations use
the system to provide information for day-to-day decisions about salary, benefits, and recognition
programs. Performance management can also support decisions making related to employee
retention, termination for poor performance, and hiring or layoffs. Because performance
management supports these admin decisions, the information in a performance appraisal can have
a great impact on the future of individual employees. Managers recognize this, which is the reason
they may feel uncomfortable conducting performance appraisals when the appraisal information is
negative and, therefore likely to lead to a layoff, disappointing pay increase, or other negative
outcome.
Finally, performance management has a developmental purpose, meaning that it serves as a basis
for developing emploees’ koledge ad skills. Ee eploees ho ae eetig epetatios a
become more valuable when they receive and discuss performance feedback. Effective performance
feedback makes employees aware of their strengths and of the area in which they can improve.
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- Performance feedback (pg. 192)
Performance feedback should be a regular, expected management activity. The practice or policy
typically seen is for it to be done once a year. But annual feedback is not enough. One reason being
that managers should be responsible for dealing with performance gaps as soon as they occur.
E. If a age oties a pole ith a eploee’s ehaiou i Jue ad the appaisal is
in November, the employee misses out on months of opportunity for improvement
Another reason for frequent performance feedback is that feedback is most effective when the
information does not surprise the employee. If an employee has to wait for up to a year to learn
what the manager thinks of his work, the employee will wonder whether he is meeting
expectations.
Conducting the feedback session
tell-and-sell approach involves the managers telling the employees their ratings and then
justifying those ratings
tell-and-liste appoah ioles aages tellig eploees thei atigs ad then letting
the employee explain their side of the story
pole-solig appoah – managers and employees work together to solve
performance problems in an atmosphere of respect and encouragement. Research suggests
this method as being the superior of the three.
2. Is it fair to characterize performance management as a way employers control workers? Why or why not?
- Performance management seems to be trending more towards a collective approach where the
involvement of appraisals is the role of both employees and management
Ex. 360-degree performance appraisal Performance measurement that combines information
fo the eploee’s aages, pees, diet epots, self, ad ustoe. A good a to aoid that
bias of a single person source of information
- Properly implemented performance management should involve a feedback stage where employees should
have equal opportunities to self-assess and discuss their performance at the workplace (pg. 193)
Managers should create the right context for the meeting. The location should be neutral (i.e. a
ofeee oo s the aage’s offie. The aage should aoue the eetig to the
employee as a chance to discuss the role of the employee, the role of the manager and the
relationship between the two. Managers should also enable the employee to be well prepared. The
manager should ask the employee to complete a self-assessment ahead of time. The self-
assessment requires employees to think about their performance over the past rating period and to
be aware of their strengths and weaknesses, so they can participate more fully in the discussion
- Performance improvement
Whe pefoae ealuatio idiates that a eploee’s pefoae is elo epetatios, the
feedback process should launch an effort to address the performance gap. Feedback sessions may
identify areas in which employees can improve in order to contribute more to the organization in a
current or future job (feedback can be given to employees already meeting job expectations)
The most effective way to impoe pefoae aies aodig to the eploee’s ailit ad
motivation. In general, when employees have high levels of ability and motivation, they perform at
or above expectations. But when they lack ability, motivation, or both, corrective action is needed.
The type of action called for depends on what is missing:
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Lack of ability
When a motivated employee lacks knowledge, skill, or ability in some area, the
manager may offer training and more detailed feedback. Sometimes it is
appropriate to restructure the job so the employee can meet the job demands
Lack of motivation
Managers with an unmotivated employee can explore ways to demonstrate that the
employee is being treated fairly and rewarded adequately. The solution may be as
simple as delivering more positive feedback.
Lack of both
Employees whose performance is below expectations because they neither have the
motivation or ability to perform a job may not be a good fit for the position.
Performance may improve if the manager directs their attention to the significance
of the problem by withholding rewards or providing specific feedback.
- In the context of employment in a capitalist economy, performance management makes a lot of sense for
organizations: it maximizes the value they can extract from workers and seeks to eliminate any behaviour
the employer does not approve of. The fairly bloodless definition of performance management in the text
i.e., esuig eploees’ atiities ad outputs otiute to the ogaizatio’s goals ad the tehial
discussio of ho to ealuate ad odif okes’ ehaiou lagel igoes the possiilit that okes
a esist oth ealuatio ad ealiget of thei atiities ad outputs.
- Workers typically resist performance management not to make things difficult for employers, but because
they see performance management as a means by which the employer seeks to alter the wage-effort
bargain that has been struck. Recall from Unit 1 that employers and workers strike both a wage-rate bargain
and a wage-effort bargain in the labour market. The wage-effort bargain determines how hard employees
will work, given the terms and conditions of their employment. This bargain reflects that the interests of
employers (maximizing profitability) may run contrary to the interests of workers (maximizing their return
on the time they are at work).
- Labour as a commodity
That workers can resist performance management reflects the unique nature of labour as a
commodity. When striking a bargain with a worker, the employer has purchased only the
eploee’s ailit to ok duig the tie the eploee atteds the okplae. Whethe the
worker actually produces anything during this time, and whether the worker produces what the
employer wants, is uncertain. Over time, workers have discovered many ways to enforce the wage-
effort bargain (e.g., limiting the way in which and pace at which work is performed by controlling
knowledge of the production process), and employers have used various techniques to counter
these worker stratagems.
It is useful to view modern performance management efforts as an extension of this dynamic.
Eploes seek to ifluee o otol okes’ ehaiou to aiize podutiit, ad okes
may resist if they suspect the outcomes will be disagreeable. Resistance can take the form of
perfunctory compliance, carelessness, absenteeism, sabotage, or quitting. In effect, pushing workers
too hard can be counterproductive to organizations, and HR practitioners can often be in the
difficult position of having to mediate the demands of workers and those of senior management.
- The Study Guide provided analysis suggesting that performance management is a tool of power that
employers can use (and that workers can resist).
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Document Summary

The te(cid:454)t(cid:271)ook (cid:374)otes that the pu(cid:396)pose of pe(cid:396)fo(cid:396)(cid:373)a(cid:374)(cid:272)e (cid:373)a(cid:374)age(cid:373)e(cid:374)t is to e(cid:374)su(cid:396)e that (cid:862)e(cid:373)plo(cid:455)ees" a(cid:272)ti(cid:448)ities a(cid:374)d outputs (cid:272)o(cid:374)t(cid:396)i(cid:271)ute to the o(cid:396)ga(cid:374)izatio(cid:374)"s goals(cid:863) (cid:894) tee(cid:374) et al. , (cid:1006)(cid:1004)(cid:1005)(cid:1007), p. (cid:1005)7(cid:1008)(cid:895). This pu(cid:396)pose is (cid:272)e(cid:396)tai(cid:374)l(cid:455) consistent with the purpose of other hr functions that we have examined so far in the course. Evaluating and changing the behaviour of workers is a challenging process because relatively high stakes are involved for the organization and for the worker, and because performance assessment is subjective. As (cid:449)ith othe(cid:396) hr fu(cid:374)(cid:272)tio(cid:374)s, alig(cid:374)i(cid:374)g e(cid:373)plo(cid:455)ees" a(cid:272)ti(cid:448)ities a(cid:374)d outputs (cid:272)a(cid:374) (cid:272)(cid:396)eate (cid:396)esista(cid:374)(cid:272)e a(cid:373)o(cid:374)g employees. This suggests that in addition to considering the techniques of performance evaluation, it is useful to consider why and how employees may resist performance management and what happens when performance management is unsuccessful. Performance management is the process through which managers e(cid:374)su(cid:396)e that e(cid:373)plo(cid:455)ees" a(cid:272)ti(cid:448)ities a(cid:374)d outputs (cid:272)o(cid:374)t(cid:396)i(cid:271)ute to the o(cid:396)ga(cid:374)izatio(cid:374)"s goals.

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