Chapter 8 Performance Management and the Employee Appraisal Process
Outcome 1 Performance Management Systems
Performance management – process of creating a work environment in which people can
perform to the best of their abilities.
Performance appraisals – the result of an annual or biannual process in which a manager
evaluates an employee’s performance relative to the requirements of his or her job and uses the
information to show the person where improvements are needed and why.
Ongoing Performance Feedback
Seven keys points to address during feedback sessions:
1. Give specific examples of desirable and undesirable behaviors.
2. Focus feedback on behavior, not the person.
3. Frame the feedback in turns of helping the employee be successful.
4. Direct the feedback toward behavior the employee can control.
5. The feedback should be timely.
6. Limit feedback to the amount the employee can process.
7. Use active communication skills and confirm that the employee is engaged in the
•If employees are surprised by their reviews, it is probably safe to say that their
supervisors have not been providing them with much ongoing feedback.
Outcome 2 Performance Appraisal Programs
Focal Performance Appraisal – an appraisal system in which all of an org.’s employees are
reviewed at the same time of the year rather than on the anniversaries of the individual hire dates.
•All employees can begin working toward those goals immediately.
•Also enables managers to compare the performance of different employees
simultaneously accurate and fair
•Review is less likely to be overlooked
The Purpose of Performance Appraisal
-Appraisal programs provide input that can be used for the entire range of HRM activities.
Promotions, transfers, layoffs, pay decisions.
-Also used in HR planning
-Also provide a “paper trail” for documenting HRM actions that can result in legal action.
-Provides the feedback essential for discussing an employee’s goal and how they align
with the org.’s goals.
-Also used to develop training and development plans for employees.
Why Appraisal Programs Sometimes Fail
•Some people believe performance appraisals discourage teamwork because they frequently
focus on the individual achievements of workers vs. what their teams or firms accomplish.
•Useful only at the extremes and are not as useful for the majority of employees in the middle.
•Often focus on short-term achievements rather than long-term improvement and learning.
1. There is a little face-to-face discussion between the manager and the employee being
2. The relationship between the employee’s job description and the criteria on the
appraisal form is not clear.
3. Managers feel that little or no benefit will be derived from the time and energy they
spend on the process or are concerned only with bad performance.
4. Managers dislike the face-to-face confrontation of appraisal interviews.
5. Managers are not sufficiently adept at rating employees or providing them with
6. The judgmental role of appraisal conflicts with the helping role of developing
7. The appraisal is just a once-a-year event, and there is little follow-up afterward.
Developing an Effective Appraisal Program
What are the Performance Standards?
When performance standards are properly established, they help translate an org’s goals and
objectives into job requirements that communicate to employee the definitions of acceptable and
unacceptable performance level.
Strategic Relevance – refers to the extent to which the standards of an appraisal relate to the
strategic objectives of the org. in which they are applied.
-Provides the documentation HR managers need to justify various training expenses to
close any gaps between employees’ current skills and those they will need in the future to
execute the firm’s strategy.
Criterion Deficiency – when performance standard focus on a single criterion to the exclusion of
other important but less quantifiable performance dimensions suffer from criterion deficiency.
-A comparison of the performance of travelling salespeople should not be contaminated by
the fact that territories differ in sales potential.