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eco244 chapter 10+.docx

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Frank Reid

Chapter 10 Performance ManagementPerformance Management process encompassing all activities related to improving employee performance productivity and effectivenessIncludes goal setting pay for performance training and development career management and disciplinary action Must provide an integrated network of procedures across the organization that will direct all work behavior Foundation of performance management is the performance appraisal processoPerformance appraisal A process typically performed annually by a supervisor for a subordinate designed to help employees understand their roles objectives expectations and performance success The performance management process1Defining performance expectations and goals 2Providing ongoing feedback and coaching 3Conducting performance appraisal and evaluation discussionaFormal appraisal methodsiGraphing rating scale a scale that lists a number of traits and a range of performance for each The employee is then rated by identifying the score that best describes his or her level of performance for each traitbAlternation ranking methodiRanking employees from best to worst on a particular trait cPaired comparison method iRanking employees by making a chart of all possible pairs of employees for each trait and indicating the better employee of the pairdForced distribution methodiPredetermined s of rates are placed in various performance categories eCritical incident methodiKeeping a record of good and bad examples of an employees workrelated behavior and reviewing the list with the employee at predetermined times fNarrative formsiProvides performance improvement plan which identifies measurable improvement goals provides directions regarding training etc gBARS behaviorally anchored rating scalesiCombines the benefits of narratives critical incidents and quantified ratings by anchoring a quantified scale with specific narrative examples of good and poor performance 1Developing BARS generate critical incidents develop performance dimensions reallocate incidents scale the incidents develop the final instrument2Its time consuming but has good advantages such as more accurate measure clear standards feedback independent dimensions consistency hManagement by objectives MB0iInvolves setting specific measureable goals with each employee and then periodically reviewing the progress made iiMain steps set organization goals set department goals discuss department goals define expected results performance reviews provide feedbackiiiMain problems setting unclear unmeasurable objectives time consuming and results in a tug of war between management and employee iElectronic performance monitoring EPMiHaving supervisors electronically monitor the amount of computerized data an employee is processing per day and thereby his or her performance4Determining performance rewardsconsequences5Conducting development and career opportunities discussions Performance Appraisal problemsInvalid or unreliable performance criteriaRating scale problemsoUnclear performance standards an appraisal scale that is too open to interpretation of traits and standards oHalo effect in performance appraisal the problem that occurs when a supervisors rating of an employee on one trait biases the rating of that person on other traitsoCentral tendency a tendency to rate all employees in the middle of the scale oStrictnessleniency the problem that occurs when a supervisor has a tendency to rate all employees either low or highoAppraisal bias the tendency to allow individual differences such as age race and sex to affect the appraisal ratings that these employees receive oRecency effect the rating error that occurs when ratings are based on the employees most recent performance rather than on performance throughout the appraisal periodoSimilartomebias the tendency to given higher performance ratings to employees who are perceived to be similar to the rater in some way Avoiding Appraisal ProblemsRaters must be familiar with the problems Raters must choose the right appraisal toolTraining supervisors to eliminate rating errorsDeveloping effective appraisal process1Conduct job analysis to ascertain characteristics required for successful job performance2Incorporate these characteristics into a rating instrument 3Make sure that definitive performance standards are provided to all raters and rates4Use clearly defined individual dimensions of job performance5Avoid abstract trait names when using graphic rating scale6Employ subjective supervisory ratings7Train supervisors to use the rating instrument properlyPerformance ratings must be jobrelated Employees must be given a copy of their job standards in advance of appraisals Managers who conduct the appraisal must be able to observe the behaviour subject to the evaluation Supervisors must be trained to use the appraisal form correctly Appraisals should be discussed openly with employees and counselling or corrective guidance offered to employees An appeals procedure should be established to enable employees to express disagreement with the appraisal Reasons Appraisal Programs Fail lack of topmanagement support unclear performance standards Problems with forms or procedures used to appraise performance poor communication in the interviewfeedback session use of the appraisal program for conflicting purposes Sources of Performance Appraisal1Supervisors2Peers3Committees immediate supervisor plus three or four other supervisors 4Self5Subordinates anonymously evaluate their supervisors performance upward feedback6360degree appraisal A performance appraisal technique that uses multiple raters including peers employees reporting to the appraise supervisors and customers Appraisal InterviewAn appraisal interview is an interview in which the supervisor and the employee review the appraisal and make plans to remedy deficiencies and reinforce strengths The interviewee should be direct and specific not personal encourage the person to talk and develop an
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