managing people exam 4

Employee Selection

Impacts both organizational success and applicant’s lives. Decisions should be fair, strategic, and beneficial to all stakeholders.

Standards for Selection Methods

Reliability, Validity, Generalizability, Utility, and Legality.

Reliability

Consistency of a method

Validity

How well does the selection method predict job performance. Measures must assess all relevant performance aspects.

Criterion-Related Validation

Shows correlation between test scores and job performance

Content Validation

Ensures test content mirrors job tasks

Generalizability

Validity across various contexts

Utility

Contribution of the method to improving hiring decisions.

ADA 1990

Requires reasonable accommodation unless undue hardship. It protects qualified individuals with disabilities from discrimination in employment.

Civil Rights Act 1991

Mandates neutral-appearing selection tools. It strengthened protections against employee discrimination.

ADEA 1967

Protects workers over 40 from age discrimination.

Selection Common Methods

Cognitive tests, personality inventories, work samples, structured interviews.

Structured Interviews

Improve reliability by focusing on observable behaviors.

Situational Interviews

Present job-relevant scenarios.

Reference Checks

Often unreliable due to overly positive or inaccurate reviews. Reference’s are asked to be written by someone who has you in good standing.

“Big Five” Personality Traits

Extroversion, Adjustment, Agreeableness, Conscientiousness, Openness to Experience. Excludes intelligence.

Cognitive Ability Tests

May have adverse impact on minority groups. Verbal comprehension, Quantitive and reasoning ability.

Emotional Intelligence

Self-awareness, regulation, motivation, empathy and social skills.

Performance Management Bias Purpose

Align employee performance with organizational goals.

Performance Feedback

Provide employees with information about their performance, improve and support employee development.

Performance Management Bias Steps

1. Identify important outcomes

2. Develop employee goals

3. Provide support

4. Evaluate performance

5. Identify improvements

6. Provide consequences

Job Descriptions

Should include measurable goals and relevant behaviors.

Annual/Biannual Reviews

Structured processes for evaluating employees' performance, compare actual vs. expected performance.

Reviews

Usually occur midyear and annually with private discussions. They assess performance and set future goals.

Categories of Fairness

1. Procedural

2. Interpersonal

3. Outcome

Continuous Reviews

Forward-focused, with fluid goal adjustment, managers are coaches, and employees want performance. Ensure alignment.

Developmental Reviews

Provide coaching and planning.

Documentation

Supports legal and administrative uses

Strategic Congruence

Ensures alignment between employee behaviors and organizational strategy. Congruent with performance, strategy goals, and culture, must be flexible.

OKR’s (Objective and Key Results)

Help link non-financial and strategic goals with strategic congruence.

Interrater Reliability

Refers to the level of agreement among different raters or evaluators assessing the same performance or behavior, ensuring consistency and accuracy in evaluations.

Procedural Fairness

Collaborative goal setting. Focuses on the fairness of the process, rather than the outcome.

Outcome Fairness

Communicating evaluation and reward expectations. Percieved fairness of the outcome.

Specificity

Includes both what and how performance is achieved; the extent to which a performance measure tells an employee what is expected and how to meet those expectations, strategic and developmental.

Evaluating Performance

Difficult to evaluate because it is complex, what is considered effective may vary. Measure what gets accomplished and how it is accomplished.

Comparative Approach

Comparing an individuals performance to another. Easy to develop and use.

Forced Distribution

Helps identify high-potential and low-performing employees. Employees ranked in predetermined categories, can improve potential of potential performance of a work place.

Paired Comparison

Compare employee with every other employee; tends to be time consuming.

Employee and Manager Goals

Should set 3-5 brief, meaningful and challenging goals, “linked up”. Making goals known to higher status people will motivate to finish goals, increases commitment.

Perspectives of Performance

1. Financial

2. Customer

3. Internal/Operations

4. Learning and Growth

-does not include marketing or sales.

First Step of ProMES

Identify products and objectives the organization expects to accomplish.

Results Approach

Minimizes subjectivity, and aligns individual’s results with organization’s strategies and goals. Uses SMART Goals, different types of measurement.

Quality Approach

System-orientated focus, evaluation of personal traits, aims to improve customer satisfaction.

Quality Approach Conflict

Many systems conflict with this approach because they lack objective and subjective feedback. Often corporate personal traits which are difficult to evaluate.

Control Charts

A statistical tool used in quality approach to provide objective feedback.

Managers used as raters

Motivated to rate accurately, most frequently used as a source of performance information.

Peers

Valuable raters because they often observe daily work, bring different perspective, not expected to provide feedback, in best position to praise.

Frame-of-Reference Training

Helps reduce rater errors and increase accuracy

Managers should ask employees to:

Rate themselves prior to receiving performance feedback

Calibration Meetings

Help ensure fairness and consistency in performance ratings,

Misdirected Effort

An employee that is motivated but lacks ability leading to poor performance and inefficiency.

Diagnosing Poor Performance

First step: consider the impact on the business, then determine the cause.

Pay

From employer’s perspective, pay is a motivational tool to align interests.

Fairness in Pay

Matters to employees because it affects their standard of living and how they compare themselves to others.

External Equity

Comparing pay to similar jobs outside of the organization, market surverys.

Internal Equity

Determined through job evaluations, focusing on those within the organization.

Investing in employee’s

Helps attract, retain and motivate a high-quality workforce, expect valuable rewards.

Efficiency Wage Theory

Suggests that higher pay leads to better performance as employees want to keep better jobs.

Conducting Market Pay Surverys

Crucial to select relevant jobs;

Point Factor System Weights

Can be assigned a priori or based on labor market analysis;

Benchmark Jobs

Used in surveys; are stable and common across organizations, and are key jobs.

Market Pay Structures

Vary significantly across countries in level and relative job worth; expatriate pay is linked closer to home country.

Communication around Pay Structures

Greatly influences employee attitudes and behaviors; employees use different comparison standards, which influences attitudes.

Currency fluctuation and Proximity to U.S. Market

Affect labor cost instability.

Low Labor Costs

May be associated with low-skilled workforce

Competitive Labor Evaluations

Consider total operating costs, product speed, and proximity to customers.

Evaluating Pay Programs

Should include cost, expected return, strategic alignment, and possible unintended consequences

Incentive Effect

Refers to how pay plans influence current employee behavior

Reinforcement Theory

Says behavior followed by rewards (monetary bonuses) increase the chance of recurrence, more likely to occur in the future.

Profit sharing and employee ownership

Help employees adopt a broader ownership mindset; employees think more like owners.

Gainsharing

Can be more motivating than profit sharing because employees feel more control over outcomes; improves performance.

Group Incentives

May demotivate top performers who feel their efforts aren’t individually rewarded; may increase competition in groups and teams

Agency Theory

Suggests executive pay should align actions with shareholder interests; focuses on divergent interests and goals.

Leniency Error

Giving all employees high ratings regardless of performance.

Merit Pay Program

Ties raises to supervisor evaluation of performance

Employee Participation in Decisions

Tends to increase job and pay satisfaction; fosters environment of trust and cooperation.

Outcome-orientated executive pay

Ties compensation performance metrics like profit or stock.