Performance Management

1. Performance Management

2. Performance Management The greater danger for most of us lies not in setting our aim too high and falling short; but in setting our aim too low, and achieving our mark.Michelangelo

3. What Is Performance • Performance is essentially what an employee does or does not do • Common elements to performance • Quality of output • Quantity of output • Timeliness of output • Presence at work • Cooperativeness

4. Factors That Influence Performance

5. Performance Management A process that consolidates: • Goal setting • Performance Appraisal • Development of a common system the aim of which is to ensure that employee performance is supporting the company's strategic aims

6. Purposes for Performance Management Strategic Administrative Developmental

7. Purposes for Performance Management STRATEGIC Link between employee activity and organizational goals Define the SKA’s necessary for implementing the strategy Develop measurement and feed back system communicate corporate culture and values

8. Performance Appraisal Performance appraisal is the identification, measurement and management of human performance in organization Identification: knowing what behaviors lead to performance Measurement: anchored tools to provide consistent assessment of performance Management: feedback and goal setting

9. Difference between Performance Management & Performance Appraisal • Performance Management: • Efforts to align employee performance with the firm goals • Defines performance • Facilitates performance • Encourages performance • Performance Appraisal: • Efforts to determinethe extent to which an employee performs work effectively • Measure performance • Evaluate performance • Feedback on performance

10. What is in Performance Appraisal System • What is measured • Who measure performance • When is it measured • How is it measure

11. What is Measured • Traits • Behavior • Task Outcome

12. Who Measure Performance Supervisor Team Peers Self Customers Subordinates

13. When is it Measured On demand when required generally as follow • Annually • Quarterly • Monthly • Task Oriented

14. How is it Measure • Absolute Standards • Relative Standards • MBO • 360 Degree system

15. Performance Appraisal Methods • Absolute Standards • Relative Standards

16. ABSOLUTE STANDARDS Measuring an employees performance against some established Standards • Essay Appraisal • Critical Incident Appraisal • Checklist Appraisal • Adjective Rating Scales • Behaviorally Anchored Rating Scales

17. ABSOLUTE STANDARDS • Essay Appraisal • It is the simplest method of performance appraisal whereby the appraiser write a narrative describing an employee’s strength, weakness, past performance, potential & suggestion for improvement the weakness of this method is that it is much dependant on rater’s writing skills and provide only the qualitative data

18. Sample Essay Appraisal Name: Position: Department: Date started on job: Date of last rating: Date of this rating: Appraisal of Performance: ____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Suggestions for development ____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Prepared By: Position: Manager’s signature: Employee’s signature:

19. ABSOLUTE STANDARDS • Critical incident Appraisal • A performance appraisal method that focus on those critical or key behaviors that makes the difference between doing a job effectively or ineffectively. Critical incidents, with their focus on behaviors, judge performance rather then personalities. The weakness of this method is that it require regular incidents writing and on the other hand it suffer the same comparison problem in essay (i.e) Quantification

20. Sample Critical Incident Appraisal

21. ABSOLUTE STANDARDS • Checklist Appraisal • A performance appraisal type in which a rater check off those Behaviors of an employee that apply

22. ABSOLUTE STANDARDS • Graphic/Adjective Trait Rating Scale • One of the oldest and most popular methods of appraisal is the adjective rating scale in which a rating scale list traits (such as quality, quantity, job knowledge & integrity etc) and range of performance values (from unsatisfactory to outstanding for each traits. • The strength of this system is that it provide qualitative analysis that is useful for comparison purpose.

24. ABSOLUTE STANDARDS • Behaviorally Anchored Rating Scales BARS • These scales combine major elements from the critical incident and adjective rating scale approaches. The appraiser rates the employees based on items along a continuum, but the points are example of actual behavior on the given job rather then general description or traits

25. ABSOLUTE STANDARDS • Behaviorally Anchored Rating Scales BARS • Although the development of Bars is time consuming and technical but it give more accurate gauge and clear standards

26. BARS Dimensions Quality of Group member input Effective 5 4 3 2 1 Group Member has read all agreed upon material Group Member participate in discussion, through not always prepare Group members does little work & offer no valuable ideas or feedback Ineffective

27. Effective 5 4 3 2 1 Can train and develop subordinates Criticize of personnel in front of others Sets a poor example Ineffective BARS for Supervision Exhibits respect towards subordinates Does not lead by example

28. RELATIVE STANDARDS Evaluating an employee’s performance by comparing the employee performance with other employees. • Group Order Ranking • Individual Ranking • Paired Comparison

29. RELATIVE STANDARDS • Group Order Ranking/Forced Distribution • The group order ranking method or forced distribution method is similar to grading on a curve and it requires the evaluator to place employee into a particular classification e.g • 15 – High Performers • 20 – High Average Performer • 30 - Average Performer • 20 - Low average Performer • 15 – Low Performer

30. RELATIVE STANDARDS • Group Order Ranking • The main advantage of this method is that it’s avoid the problems of inflating performance in average column but some times when dealing to a small group times excellent performer may be forced to keep in low category

32. RELATIVE STANDARDS • Paired Comparison • In paired comparison method for every traits (quality of work, quantity of work, creativity etc) you pair and compare very subordinate. This method become unwieldy when large numbers are being compared

34. Management by Objective (MBO) MBO involves setting specific measurable goals with each employee and then periodically reviewing the progress made

35. Performance Appraisal under an MBO Program Management by Objectives

36. 360 Degree Performance Appraisal 360 Degree Performance. Combination of self, peer, supervisor, and subordinate performance evaluation

38. Benefits of Performance Appraisal For the Management • Identification of performers and non-performers and their development. • Opportunity to prepare employees for assuming higher responsibilities. • Opportunity to improve communication between the employees and the management. • Identification of training an development needs. • Generation of ideas for improvements. • Better identification of potential and formulation of career plans For the Appraisee • Better understanding of his role • Clear understanding of strengths and weaknesses by employees • Increased motivation, job satisfaction, and self-esteem. • Opportunity of open discussion regarding work problems & how to overcome them • Improved working relationships with the superiors.

39. Benefits of Performance Appraisal For the Organization • Improved performance throughout the organization. • Creation of a culture of continuous improvement and success. • Conveyance of message that people are valued.

40. Common Problems in Appraisal Methods • Leniency Error • A means by which performance appraisal can be destroyed by evaluating employees against one’s own value system • Halo & Horn Effect • The tendency to let our assessment of an individual on one trait influence our evaluation of that person on other specific traits • Central Tendency. • The tendency of rater to give average ratings

41. Common Problems in Appraisal Methods • Stereotyping (Rater Biased) • A standard mental picture about a person based on person’s Sex, color, caste, age, style of clothing, political view etc • Recency Error • Recent behavior at evaluation time

42. Performance Appraisal Interview An interview in which the supervisor and subordinate review the appraisal and make plans to remedy defensives and reinforce strength