Performance Management 2 nd Edition Performance Management and
- Slides: 53
Performance Management 2 nd Edition
Performance Management and Reward Systems in Context
Overview Ø Ø Ø Ø Definition of Performance Management (PM) The Performance Management Contribution Disadvantages/Dangers of Poorly Implemented PM Systems Definition of Reward Systems Aims and Role of PM Systems Characteristics of an Ideal PM System Integration with Other Human Resources and Development Activities
Definition of Performance Management (PM)
Definition of PM 1. Continuous Process of ü ü ü Identifying Measuring Developing The performance of individuals and teams
Definition of PM (continued) and 2. Aligning performance with Strategic Goals of the organization
Performance Management is NOT performance appraisal
PM is NOT performance appraisal n Performance Management • Strategic business considerations • Driven by line manager • Ongoing feedback n So employee can improve performance
PM is NOT performance appraisal n Performance Appraisal • Driven by HR • Assesses employee Strengths & n Weaknesses n • Once a year • Lacks ongoing feedback
Contributions of Performance Management
Contributions of Performance Management For Employees ü Clarify definitions of üjob üsuccess criteria ü ü ü Increase motivation to perform Increase self-esteem Enhance self-insight and development
Contributions of Performance Management For Managers ü ü Communicate supervisors’ views of performance more clearly Managers gain insight about subordinates Better and more timely differentiation between good and poor performers Employees become more competent
Contributions of Performance Management For Organization/HR Function ü ü Clarify organizational goals Facilitate organizational change Fairer, more appropriate administrative actions Better protection from lawsuits
Disadvantages/Dangers of Poorly-implemented PM Systems
Disadvantages/Dangers of Poorly-implemented PM Systems For Employees n n Lowered self-esteem Employee burnout and job dissatisfaction Damaged relationships Use of false or misleading information
Disadvantages/Dangers of Poorly-implemented PM Systems For Managers n n Increased turnover Decreased motivation to perform Unjustified demands on managers’ resources Varying and unfair standards and ratings
Disadvantages/Dangers of Poorly-implemented PM Systems For Organization n n Wasted time and money Unclear ratings system Emerging biases Increased risk of litigation
Reward Systems
Reward Systems Definition Set of mechanisms for distributing Ø Tangible returns and Ø Intangible or relational returns As part of an employment relationship
Reward Systems Tangible returns Ø Cash compensation ØBase pay ØCost-of-Living & Contingent Pay ØIncentives (short- and longterm)
Reward Systems Tangible returns (continued) Ø Benefits, such as ØIncome Protection ØAllowances ØWork/life focus
Reward Systems Intangible returns Ø Relational returns, such as ØRecognition and status ØEmployment security ØChallenging work ØLearning opportunities
Returns and Their Degrees of Dependency on the Performance Management System
Returns with Low Dependency on the Performance Management System § § Cost of Living Adjustment Income Protection
Returns with Moderate Dependency on the Performance Management System § § Work/Life Focus Allowances Relational Returns Base Pay
Returns with High Dependency on the Performance Management System § § § Contingent Pay Short-term Incentives Long-term Incentives
Purposes of PM Systems
Purposes of PM Systems: Overview Ø Ø Ø Strategic Administrative Informational Developmental Organizational maintenance Documentational
Strategic Purpose Ø Ø Link individual goals with organization’s goals Communicate most crucial business strategic initiatives
Administrative Purpose Ø Provide information for making decisions re: ØSalary adjustments ØPromotions ØRetention or termination ØRecognition of individual performance ØLayoffs
Informational Purpose Communicate to Employees: Ø Expectations Ø What is important Ø How they are doing Ø How to improve
Developmental Purpose Ø Ø Performance feedback/coaching Identification of individual strengths and weaknesses Causes of performance deficiencies Tailor development of individual career path
Organizational Maintenance Purpose Ø Ø Plan effective workforce Assess future training needs Evaluate performance at organizational level Evaluate effectiveness of HR interventions
Documentational Purpose Ø Ø Ø Validate selection instruments Document administrative decisions Help meet legal requirements
An Ideal PM System: 14 Characteristics 1. 2. 3. 4. 5. 6. 7. Congruent with organizational strategy Thorough Practical Meaningful Specific Identifies effective/ ineffective performance Reliable
An Ideal PM System: 14 Characteristics (continued) 8. 9. 10. 11. 12. 13. 14. Valid Acceptable and Fair Inclusive Open (No Secrets) Correctable Standardized Ethical
Congruent with organizational strategy n n Consistent with organization’s strategy Aligned with unit and organizational goals
Thorough n n All employees are evaluated All major job responsibilities are evaluated Evaluations cover performance for entire review period Feedback is given on both positive and negative performance
Practical n n Available Easy to use Acceptable to decision makers Benefits outweigh costs
Meaningful n n n Standards are important and relevant System measures ONLY what employee can control Results have consequences Evaluations occur regularly and at appropriate times System provides for continuing skill development of evaluators
Specific Concrete and detailed guidance to employees • What’s expected • How to meet the expectations
Identifies effective and ineffective performance n Distinguish between effective and ineffective • Behaviors • Results n Provide ability to identify employees with various levels of performance
Reliable n n n Consistent Free of error Inter-rater reliability
Valid n n n Relevant (measures what is important) Not deficient (doesn’t measure unimportant facets of job) Not contaminated (only measures what the employee can control)
Acceptable and Fair n Perception of Distributive Justice • Work performed Evaluation received Reward n Perception of Procedural Justice • Fairness of procedures used to: Determine ratings n Link ratings to rewards n
Inclusive n Represents concerns of all involved • When system is created, employees should help with deciding What should be measured n How it should be measured n • Employee should provide input on performance prior to evaluation meeting
Open (No Secrets) n n Frequent, ongoing evaluations and feedback 2 -way communications in appraisal meeting Clear standards, ongoing communication Communications are factual, open, honest
Correctable n n Recognizes that human judgment is fallible Appeals process provided
Standardized n n Ongoing training of managers to provide Consistent evaluations across • People • Time
Ethical n n n Supervisor suppresses self-interest Supervisor rates only where she has sufficient information about the performance dimension Supervisor respects employee privacy
Integration with other Human Resources and Development Activities
n PM provides information for: • Development of training to meet organizational needs • Workforce planning • Recruitment and hiring decisions • Development of compensation systems
Quick Review n n n n Definition of Performance Management (PM) The Performance Management Contribution Disadvantages/Dangers of Poorly Implemented PM Systems Definition of Reward Systems Aims and Role of PM Systems Characteristics of an Ideal PM System Integration with Other Human Resources and Development Activities
- Mis chapter 6
- Using mis (10th edition) 10th edition
- Performance management vs performance appraisal
- Disadvantages of bell curve in performance appraisal
- Msqh standard 7
- Food service cycle
- Food and beverage operations management
- Network performance management system
- Management ricky griffin
- Management by stephen p robbins 9th edition
- Marketing management (arab world edition)
- What is the value delivery process
- Marketing management (arab world edition) philip kotler
- Marketing kotler
- International financial management jeff madura 13th edition
- Management fifteenth edition
- Gary dessler human resource management
- Information technology project management 9th edition
- Blue project chapter 5
- Supply chain management sunil chopra 6th edition ppt
- Ricky w griffin management 12th edition
- Management twelfth edition
- Robbins and coulter 2007
- Marketing management (arab world edition) philip kotler
- Marketing management (arab world edition)
- Management stephen robbins 10th edition
- Introduction to management by stephen p robbins
- Management robbins coulter
- Management of information security 5th edition
- Vertical
- Eleventh edition management
- Management 11th edition by stephen p robbins
- Informal factors that influence goal congruence
- International financial management 5th edition
- Stress management for life 5th edition
- International human resource management dowling 6th edition
- Modern database management 12th edition ppt
- Modern database management system
- Stephen p robbins management 15th edition pdf
- Goals of international finance
- Performance appraisal in human resource management
- Materiality concept
- Project management quality control
- Modern database management 8th edition
- Information technology project management 9th edition
- Management fundamentals 8th edition
- Management fourteenth edition
- Introduction to management information systems 5th edition
- Voyage estimating decision support system
- Transaction cannot be subdivided
- Information technology project management 9th edition
- Marketing management 12th edition
- Marketing management 12th edition
- International financial management 13th edition