Chapter 7: Performance Management Notes (copy)

Review Notes

Performance Management

The process encompassing all activities related to improving employee performance, productivity, and effectiveness.

Five Steps in Performance Management Process

1. Define performance expectations 2. Provide ongoing feedback and coaching 3. Conduct performance appraisal and evaluation discussions 4. Determine performance rewards/consequences 5. Conduct development and career opportunity discussions.

Performance Improvement Plan (PIP)

A plan that outlines expectations with a timeline to reach acceptable performance levels.

Graphic Rating Scale (GRS)

A scale that lists traits and range of performance for each trait, used in employee performance appraisal.

Alternation Ranking Method

Rank employees from best to worst on a trait, alternating between highest and lowest.

Paired Comparison Method

A method where each trait pair of employees is compared, scoring higher-ranked with a '+' and lower with a '-'.

Forced Distribution Method

A performance appraisal method where predetermined percentages of ratees are placed into categories.

Critical Incident Method

A method that requires keeping a record of unusually good or poor examples of an employee's work-related behavior.

Behaviourally Anchored Rating Scales (BARS)

Combines narratives and ratings, anchoring a scale with specific examples of performance.

Management by Objectives (MBO)

A performance appraisal method that involves jointly agreed-upon performance objectives linked to organizational goals.

360-Degree Appraisal

Feedback collected from multiple sources such as managers, peers, and subordinates.

Types of Appraisal Interviews

1. Satisfactory—Promotable: development plans. 2. Satisfactory—not promotable: maintain performance. 3. Unsatisfactory—Correctable: action plan to correct performance.

Common Problems in Performance Appraisal

Issues include validity and reliability of appraisals, unclear performance standards, and various biases.

Halo Effect

A cognitive bias where one trait influences ratings of other traits.

Central Tendency

The tendency to rate all employees as average, avoiding high or low extremes.

Recency Effect

The tendency to give too much weight to recent performance rather than the entire evaluation period.

Self-Appraisal

A method where employees assess their own performance.

Performance Standards

Defined criteria that employees must meet in their job performance.

Legal Considerations in Performance Appraisal

Using job analysis to determine necessary characteristics and ensuring clarity in performance standards.

Future of Performance Management

Linking individual goals to business strategy, emphasizing leadership, accountability, and employee development.