1
Workers give performance management programs a
failing grade

• Less than half of surveyed ees felt their co held
  people accountable for performance
• Slightly more than half felt their co set high
  performance standards
• Only 40 of ees saw connection between their
  day-to-day work and their cos goals
• 61 of ees felt their performance appraisal was
  accurate
• 54 said ees w/ better reviews get better raises
  and bonuses
• Source SHRM HR News, 4/21/04

2
Measurement Tools

• The type of judgment that is required
• Relative or absolute
• The focus of the measure
• Trait, behavior, or outcome

3
Approaches to Measuring Performance

• Relative
• Ranking
• Paired comparison
• Forced Distribution (aka Rank and Yank)
• GE, Ford, etc. 10-80-10
• Every company needs to get rid of
  underperformers and most managers wont until
  they have to. (Fortune. 8/13/01)
• Trait
• Graphic rating scales
• Behavioral
• Critical incident
• BARS
• Outcomes
• MBO

4
Sample Trait Scales
Rate each worker using the scales below.
Decisiveness 1 2 3 4 5
6 7 Very low Moderate Very
high
Reliability 1 2 3 4 5
6 7 Very low Moderate Very
high
Energy 1 2 3 4 5
6 7 Very low Moderate Very high
Loyalty 1 2 3 4 5
6 7 Very low Moderate Very high
5
Advantages and Disadvantages of Appraisal Tools

• Advantages Disadvantages
• Graphic Simple to use Standards may
• Rating Provides quantitative be unclear halo
• Scales rating effect, restriction of
  range bias
• Forced Avoids leniency Artificial
• Distribution
• Critical Incident Behavior-based No
  quantitative feedback rating
• BARS Behavioral anchors Difficult to develop
• MBO Tied to performance Time-consuming
• objectives

6
Evaluation of Major Appraisal Formats
Legal Defensibility
Appraisal Format
Administrative Use
Developmental Use
- - 0
Absolute Relative Trait Behavior Outcome
0 0 0
0 - --
-- Very Poor
- Poor
Good
Very good
0 Unclear or mixed
7
Discussion Question 2

• Superficially, it seems preferable to use
  objective performance data (such as productivity
  figures) when available, rather than subjective
  supervisory ratings to assess employees. Why
  might objective data be less effective
  performance measures than subjective ratings?

8
Discussion Question 7

• What criteria do you think should be used to
  measure team performance? What sources should be
  used for the appraisal? Should individual
  performance still be measured? Why or why not?

9
Legal Issues

• A recent analysis of 295 court cases involving
  performance appraisal found judges decisions to
  be favorably influenced by the following
  additional factors
• Use of job analysis
• Providing written instructions
• Allowing employees to review appraisal results
• Agreement among multiple raters (if more than one
  was used)
• The presence of rater training