415.94 - University of Washington



Mgt 412 -- Performance Appraisal and Compensation

Winter 2006

Tuesday and Thursday 10:30-12:20

Balmer 311

|Dr. Vandra L. Huber |Office: 543-5365 |

|360 MacKenzie Hall |Home: 425 881-5809 |

|E-Mail: vandra@u.washington.edu |Office Hours: 12:20 – 2 p.m. Tuesday and Thursday or by |

| |appointment |

1. Purpose

This course will examine the strategic use of compensation and appraisal to attain organizational objectives. Emphasis will be upon the design of compensation systems, the choice of measurement metrics and variable pay plans, namely stock options, employee stock ownership plans, family of measures, compensation for leaders and top executives. Additional, the course will discuss “hot topics” in compensation and appraisal. Students complete a term-long simulation in which they design a compensation system. Expertise in using excel, and conducting simple statistical analyses such as means, modes, regression is useful.

At the conclusion of the course, a student should be able to:

a) Develop a compensation system from start to finish

b) Design a legally defensible compensation system

c) Evaluate an organization's pay structure for bias

d) If given wage survey data, analyze it, and set appropriate wage rates.

e) Design a legally defensible performance appraisal instrument.

f) If given a specific job to evaluate, develop appropriate performance standards and metrics.

g) Give constructive performance feedback

h) Successfully negotiate starting salaries for yourself and others

i) Evaluate the value of stock options, profit sharing plans and gain sharing plans.

j) Develop a balanced scorecard with appropriate metrics

2. Textbook

Milkovich, G and Newman,J., 2005 Compensation. 8th edition. McGraw Hill.

A package of readings is available at the RAM copy center on University Avenue at 42nd Street. The telephone number for the RAM copy center is (206) 632-6630. The packet is listed under the title: BA412 compensastion Professor Vandra Huber.

Some material including my power point presentation slides will be located on my course website.

. You will be able to download slides from this site as well as some other materials that will be of use for the class project.

3. Class Meetings and Format:

The class will meet on Tuesdays and Thursdays. A variety of methods of instruction will be used in the course including lecture and discussion on compensation/ performance measurement principles, case analysis, and experiential exercises. Films and/or guest appearances will be provided on occasion, and student contributions will be encouraged frequently through individual discussion and group presentations. Some class periods but not many will be sat aside to work on group projects.

4. Course Grading Policies:

| | |

|I. Participation |10% |

|Class Discussion | |

|Participation and completion of all simulations | |

| | |

|II. Skill Builders (Your choice). Students must complete four skill builders |40% |

| | |

|Skill builder #1 Evaluating three jobs using Hay System of Job Evaluation | |

|Skill builder #2 Evaluating Jobs at Bothell Technology | |

|Skill Builder #3 Targeting Teachers Pay | |

|Skill Builder #4 KTVX Project (Counts as 2 skill builders). Will help you do better on group project But does | |

|requirement significant time investment. | |

|Skill Builder #5: Skill Based Pay Exercise | |

|Skill Builder #6 Development of performance appraisal system for a specific job. (preferable the one you wrote the | |

|job description for in skill builder #1). | |

|Research paper on a compensation/appraisal topic (must get approval of topic from professor). 5-7 pages counts as | |

|one skill builder and 10-15 pages counts as two. | |

|III. Integrated Compensation Simulation | |

|Benchmark Reports |50% |

|Oral Presentation | |

|Written Paper | |

5. Skill Builders

To give students an opportunity to practice various aspects of compensation` improve students’ skill in analyzing problems relating to compensation and appraisalStudents have several options to fulfill the individual project requirement. A summary of the requirements will be available on the course webpage. They include:

• Job Description Project (job analysis, performance metrics, salary focus)

• Evaluation of Organizational compensation/appraisal process via a memorandum to the boss

• 10 page research paper on a compensation or performance management topic. Such topics might include: Scanlon Pay Plans, Pay in Maquiladoras, Skilled based pay plans, Analysis of Health benefits, Analysis of Social Security, 360 degree feedback systems, comparable worth, issues in global compensation

6. Class Participation

Regular attendance and participation are essential elements of this class. Students should notify the professor by noon if they are going to be absent. One notified absent is allowed without penalty. Failure to attend class regularly (Must attend classes with speakers no exceptions) and to actively participate will result in a lowering of your grade.

9. Integrated Compensation Simulation

Students will work in teams three to four persons to complete a compensation/appraisal simulation. To insure that students work on the project all quarter long, suggested deadlines for completing components of the project will occasionally be identified by the professor. Your report should be professionally prepared (typed) such that it would be appropriate to distribute to executives in an executive briefing session.

Interim Report Updates. Each group will be required to give two interim report updates. The interim reports are designed to ensure that: (1) teams receive interim feedback so that they may improve the final product; 2) projects are proceeding at an appropriate pace 3) the final project will meet or exceed expectations.

Final Oral Presentations. Each group will be responsible for a 30 minute FORMAL report which summarizes their findings. Presentations will be evaluated on such criteria as (1) Use of Visuals, (2) Time Management, (3) Completeness, (4) Cohesiveness of Team, (5) Personal Appearance and Professionalism; (6) Salesmanship; (7) Ability to Field and Answer Questions; (8) Summation. The presentation is an oral examination of course learnings. The professor will play the role of the company’s CEO and your classmates will serve as members of the senior management team. The professor as well as classmates will ask a series of questions regarding

Students should recognize that the team project is a very time-consuming and demanding skill building simulations. It requires a great deal of out of class work (up to 40 hours if you aren't focused). The project also requires spread sheet analysis using EXCEL and the ability to calculate simple regression equations. Teams will be composed by the professor based on skills, schedules and background.

Peer Appraisal. Because it is important that all team members contribute to the project, group members will complete peer evaluations on each others. Students should meet in their groups at the beginning of the quarter and go over the peer evaluation, clarify expectations and responsibilities. The peer evaluation is one component of the course’s 360 degree feedback process. These evaluation will be used for development and for evaluation of group member contributions. Peer evaluations have the potential to raise or lower a student's grade significantly.

Course Outline

|Date |Topic |

|Tuesday, January 3 |Course Overview |

| |Classmate Introductions |

| |Complete Project profiles |

| |The compensation model |

| | |

|I. Compensation Strategy |

|Thursday, January 5 |Readings: |

| |Milkovich and Newman, Chapter 1 and 2 |

|Key Terms | |

|Strategic Compensation |Class Activity |

|Equity (Internal, External, |Choose an organization you are familiar with. Bring a copy of their “stated” compensation policy |

|Employee) |(usually on the internet) or write 1-3 paragraphs describing their compensation policy. In class, we |

|Procedural Fairness |will discuss and compare your organization’s compensation strategy with other companies. If you have |

| |not worked, find a company on the internet and print out their compensation strategy (e.g. Boeing, |

| |Merck, Amgen, Intel, Macy’s, Kellogg, Amazon, Nordstrom, Chyrsler, Coca-Cola, McDonalds,Walmart, etc). |

| |It can not be Microsoft or Bristol Myers. |

|Tuesday, January 10 |Readings: |

| |Milkovich and Newman, Chapter 17 |

|Key Terms |Power point slides on legal issues To Be Passed Out |

|Fair Labor Standards Act | |

|Equal Pay Act |Class Activity |

|Civil Rights Act |Lecture discussion on legal issues in compensation. |

| |

| |

|Internal Equity |

|Thursday, January 12 |Readings |

| |Milkovich and Newman, Chapters 3 |

|Key Terms | |

|Internal Alignment |In Class Exercise |

|Pay Fairness |Before class read the Your turn exercise in chapter 3. In class, you will discuss this pay structure in |

|Equity Theory |small groups. Come to class with the pay differentials between concern master and each other position |

|Tournament Theory |(e.g. $4,390/$6035) calculated. |

| | |

| |Term Project groups announced. |

|Tuesday, January 17 |Reading |

| |Milkovich and Newman, Chapter 4 |

|Key Terms |Vandra L. Huber 1999. Writing Job Descriptions (Packet) |

|Job Analysis | |

|Work Flow |In class Exercise |

|Job Descriptions |In class you will interview one another and write up a small job description on the person’s job. |

|Job Specifications | |

|Thursday, January 19 |Readings |

| |M & N Chapter 5 |

|Key Terms |Bellak, A. O. The Hay Guide Chart Profile Method of Job Evaluation. Handbook of Wage and Salary (Reading|

|Job evaluation |in your packet). |

|Hay System of Job Evaluation | |

|Compensable Factors |In class Exercise: |

|Factor Comparison Method |In class we will evaluate three jobs using the Hay Guide Chart Profile Method (Know-How, Problem |

| |Solving, and Accountability). |

|Tuesday, January 24 |Reading |

| |Milkovich & Newman Chapter 5 |

|Key Terms |Review point factor plans in packet |

|Point Factor Evaluation | |

|Compensable Factors |Skill Builder #1: Bothell Technology (In Packet) |

|Factor Weights |Come to class with your rankings and point totals for the jobs at Bothell Tech. You will meet in groups |

|Degrees |to reach consensus on job worth |

| |

|External Competitiveness |

|Thursday, January 26 |Readings |

|Key Terms |Milkovich & Newman ,Chapter 7 |

|Labor markets | |

|External Competitiveness |In class exercise |

|Pay Policies, |We will do an exercise in which we discuss the appropriate mix of various types of pay and benefits for |

|Wage and Salary Surveys |different types of jobs. No advance preparation required and examine various salary surveys. |

|Reliability and Validity | |

| | |

|Tuesday, January 31 |Readings: |

| |Milkovich & Newman, Chapter 8 |

|Key Terms |Building Pay Structures: An approach to establishing a job hierarchy. ISBN 1-57963-0103. |

|Pay Grades | |

|Broadbanding |KTVX Assignment Overview given |

|Overlap | |

|Midpoints | |

|Salary Structures | |

|IV. Performance Measurement |

|Thursday, February 2 | |

| |Readings |

|Key Terms |Milkovich & Newman, Chapter 9 |

|Pay for Performance |Kerr, S. 1995. On the folly of rewarding A, while hoping for B. Academy of Management Executive. Vol |

|Operant Theories |9(1). Packet |

|Cognitive Theories |Pfeffer, J. 1998. Six Dangerous myths about pay. Harvard Business Review. May-June Issue. Packet |

|Equity Theory | |

|Fairness | |

|Tuesday, February 4 | |

| |Readings |

|Key Terms |Milkovich & Newman, Chapter 10 |

|Pay for Performance |Steve Bates, Top Pay for Best Performance. Packet of Readings |

|Gain Sharing | |

|Profit Sharing |Compensation Group Project Briefing No. 1 |

|Employee Stock Ownership Plans |Students should provide an update on their group project. For this briefing students should discuss |

|Earnings at Risk Plans |their point factor evaluation plan including compensable factors choices, weights, degrees and process |

| |by which they evaluated the worth of jobs. |

|Thursday, February 6 |Guest Speaker |

| |Jean Berry, Human Resources director, Amgen |

| | |

| | |

|Tuesday, February 14 |Readings |

| |Milkovich and Newman, Chapter 11 |

|Key Words: |Performance Management power point slides |

|Performance Appraisal | |

|Graphic Rating Scales |In class |

|Narratives |Lecture Discussion on Performance Management |

|Forced Distribution | |

|Judgmental Bias | |

|Thursday, February 16 | |

| |Readings: |

|Key words |Milkovich & Newman, Chapter |

|Performance Appraisal |J. Waldroop & Timothy Butler. 1996. The executive as Coach, HBR. |

|360 degree Feedback | |

|Peer Evaluations |In class |

|Upward Appraisals |Movie on Performance Feedback |

| |Where is Alvin? Roleplay. Please read your part before today’s class. |

|Thursday, February 16 |Turn In Skill Building: KTVX Broadcast Company |

| |Come to class with numbers calculated. We will discuss it in class. Plan ahead. It takes 3-7 hours to |

| |do this one. |

|Tuesday, February 21 |Reading |

| |Milkovich & Newman Chapter 6 |

|Key Terms |Reading on skill based pay Packet |

|Skill Based Pay | |

|Key Competencies |In Class |

|Reliability |Skill Builder #3 Developing a Skill Based Pay Plan for a Clerical Support Team. Before class read over |

|Validity |the job descriptions for the organization and think about the commonalities and differences between the |

|Bias |jobs. |

| |What are common to all jobs? |

| |What skills are of higher value and therefore should be rewarded at a higher level? |

|Thursday, February 23 |Reading |

|Key Terms: |M & N, Chapter 12 & 13 |

|Employee Benefits | |

|Contingent Workers |In Class |

|Domestic Partners |Lecture/ discussion on benefits |

| |Compensation Group Project Preliminary Briefing No. 2 |

| |Students should provide an update on their group project. For this briefing students should discuss |

| |their the results of their market data research as well as their pay policy decisions. They should also|

| |have calculated their regression lines which compare internal and external pay. |

| |

|V, Compensation of Special Groups |

|Tuesday, February 28 |Readings: |

| |Milkovich & Newman, Chapter 14,15 & 16 (Scan) |

|Key Terms: | |

|Sales Compensation |MAPCO Roleplay Simulation |

|Contingent Workers |Prior to today’s class, meet with your team mates (Union versus City) and decide upon your strategy for |

|Unionized Workers |the upcoming negotiation. In class, you will have an hour and 15 minutes to reach an agreement over the |

| |contract for the union. |

|Thursday, March 2 | |

| |Readings: |

|Key Terms |Professor Huber’s Excellent Tips on How to negotiation your salary. Packet |

|Salary Negotiations | |

|BATNA |In Class |

|ZOPA |Lecture/ discussion of negotiating compensation and benefits |

|Tuesday, March 7 |Salary Negotiation Simulation |

| | |

|Key Terms |Before class read your role assignment and come prepared to negotiate a salary and benefits package. |

|Salary Negotiations |There will be prizes for the highest scoring team. |

| | |

|Thursday, March 9 |Group Presentations |

Group Project Information Sheet

1. Name______________________ Major____________

2. _(Check one) (_HRM 415

3. Telephone Number_______________ E-Mail__________

4. My grade goal in this course is______

5. I am taking ______ courses this quarter for _____ hours.

6. This course ranks ______ out of ______ in priority for me this quarter.

7. HRMOB courses you have taken_________________________________________________

_____________________________________________________________________________________________

8. Statistical Courses Taken_________________________________________________________________

____________________________________________________________________________________________

9. Familiarity with the following. Rate on a 1 to 7 scale with (1) representing "No Confidence or never used" and (7) representing "Very Confident or wizard"

|( |Word processing |( |Power point |( |Oral Presentation Skills |

|( |Simple regression |( |Team Building |( |Project organization |

|( |Excel Spread sheets |( |Computer graphics |( |Library Research |

|( |Project Leadership |( |Internet Researching |( |Writing/ grammar s |

10. Please indicate the number of hours you work a week and what job you hold

_____________________________________________________________________________________________

11. Please indicate by day of the week, the hours you can not possibly meet for group meetings due to work, class or religious conflicts. Preferences don't count. If you eliminate too many times you will end up in the "who knows when they can meet group!! Indicate reason

Tuesday

Tuesday

Thursday

Thursday

Friday

Saturday

Sunday

-----------------------

[pic]

................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download