HRT 350 Lecture Notes - Lecture 7: Performance Appraisal, Normal Distribution, Job Analysis

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Chapter 7 Evaluating Employee Performance
Performance Appraisals
Informal
o Day to day management affirmation and direction that is verbal by nature
Formal
o Annual written appraisals on a company performance appraisal form
Appraising Performance
Why appraise performance?
o May play an integral role in the employer’s performance management process
o Help in planning for correcting deficiencies and reinforce things done correctly
o In identifying employee strengths and weaknesses, are useful for career planning
o Affect the employer’s salary raise decisions
Performance Appraisal Roles
Immediate supervisors / managers
o Usually do the actual appraising
o Must be familiar with basic appraisal techniques
o Must understand and avoid problems that can cripple appraisals
o Must know how to conduct appraisals fairly
HR department
o Serves a policy-making and advisory role
Prepares forms and procedures and insists that all departments use them
o Responsible for training supervisors to improve their appraisal skills
o Responsible for monitoring the system to ensure that appraisal formats and
criteria comply with EEO laws and are up to date
Functions of Performance Appraisals
Performance feedback
o Informal feedback is daily coaching by managers
o Formal feedback should not ‘surprise’ employees
o Documentation occurs throughout the year
o Engage employees for ideas and feelings
o Measure objective data when possible
Functions of Performance Appraisals
Appraisal and Training / Development
o Determine the competency gap
o Measure the effectiveness of training
Decision-making tool
o Compensation (No. 1 purpose), promotion, transfer, grievance, or discipline
decisions
Validation of selection process
o Affirms the level of effectiveness for employee selection procedures
Principal Appraisal Rating Systems
Trait-based Ratings
o Personal characteristics
Behavior-based Ratings
o Very common in hospitality friendliness towards guests, helpfulness
Result-based Ratings
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o Sales, up-selling rooms, number of guests served
Methods of Appraising Performance
Simple of Straight Ranking
o Rank order
Alternative Ranking
o Rank order best/worst, 2nd best/2nd worst
Pair comparison
o Tom is better than John
o Tom is better than Don
Forced Distribution
o Normal distribution
Graphic Rating Scale
o Management chooses specific job criteria to assess
Quality, quantity, attendance
Behaviorally anchored rating scale (BARS)
o Uses quantified scale with specific narrative examples of good and poor
performance
Behavioral Observation Scales (BOS)
o Managers rate an employee’s performance based on specific examples of critical
accidence
Narrative Essays
Critical Incidents
o Individual logs on employees
Management by Objectives (MBO)
o Setting specific measurable goals with each employee and then periodically
reviewing the progress made
Potential Rating Scale Appraisal Problems
Unclear standards an appraisal that is too open to interpretation
Validity / Reliability Errors
Construct validity does the performance appraisal measure what it claims to measure?
o Ex. Measuring tardiness with how many call-offs received on a period
Content validity performance appraisal must measure the entire issue, not just a portion
or part
o Ex. Measuring customer service on speed alone
Inter-rater reliability do managers / raters agree on the same rating for employees?
Consistency use data over a period of time to gain consistency
Common Biases
Halo Effect: occurs when an employee receives high ratings in every category because of
one performance area or category that is above standard
Stringency (Severity) and/or Leniency Bias: occurs when all employees are rated very
high or very low
Central Tendency Bias: occurs when evaluators give the ‘central’ or middle score to most
employees regardless of excellent or poor performance
Recency Bias: occurs when an appraiser give more weight to recent performance or one
critical accident and ignores earlier performance
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