Prerequisite stage - Unisa Study Notes



WORKBOOK 1PERFORMANCE MANAGEMENT IN CONTEXTPREPARATION FOR EXAMQUESTION 1MAKE SURE YOU KNOW THE DIFFERENCES BETWEEN PERFORMANCE MANAGEMENT AND PERFORMANCE APPRAISAL.Performance Appraisal Systems Performance Management Systems Focus is on performance appraisal and the generating of ratings Focus is on performance management Emphasis is on relative evaluation of employees Emphasis is on performance improvement of individual employee and his/her departmental or team performance Annual exercise – though normally periodic evaluations are made Continuous process with quarterly or periodic performance review discussions Emphasis is on ratings and evaluation Emphasis is on performance planning, analysis, review, development and performance improvements Rewards and recognition of good performance are important components The rewarding of performance may be an integral part – defining and setting performance standards are integral components Designed and monitored by the HR department Designed by the HR department, but could be monitored by the respective departments themselves Ownership is mostly with HR administration Ownership is with line managers; HR administration facilitates its implementation Critical success factors (CSFs) and Key performance indicators (KPIs) are used for bringing in objectivity CSFs and KPIs are used as a planning mechanism There are review mechanisms to ensure objectivity in ratings There are review mechanisms essentially to facilitate performance improvements It is a system with deadlines, meetings, input and output, as well as a format It is a system with deadlines, meetings, input, output, as well as a format It is format-driven with the emphasis on the process, linked to promotions, rewards, training and development interventions, placement, etc. It is process-driven with the emphasis on the format as an aid linked to performance improvements and through them to other career decisions as and when necessary QUESTION 2PERFORMANCE MANAGEMENT WITHIN AN INTEGRATED HUMAN RESOURCE MANAGEMENT SYSTEMACCORDING TO WERNER, SCHULER AND JACKSON (2012:290) PERFORMANCE MANAGEMENT ACTIVITIES SHOULD BE ALIGNED WITH THE ORGANISATION’S INTERNAL ENVIRONMENT, EXTERNAL ENVIRONMENT,?AND OTHER HR ACTIVITIES;THREE KEY ISSUES IN THE INTERNAL ENVIRONMENTORGANISATIONS BUSINESS STRATEGYCOMPANY CULTURETECHNOLOGYBE ABLE TO EXPLAIN THOSE THREE ASPECTS IN DETAILTHREE KEY ISSUES IN THE EXTERNAL ENVIRONMENT LEGAL ENVIRONMENTLABOUR MARKETCOUNTRY CULTURES????????????? BE ABLE TO EXPLAIN THOSE THREE ASPECTS IN DETAILOTHER HR ACTIVITIES REFERS TO; STUDY THE SECTION ON PAGE 23-24 PRESCIBED BOOK. PAY ATTENTION TO THE RELATIONSHIP BETWEEN PERFORMANCE MANAGEMENT AND OTHER HR ACTIVITIES IN THE ORGANISATION.PERFORMANCE-BASED INCENTIVES AND;EMPLOYEE DEVELOPMENT???????EXAMPLE: HOW CAN ORGANISATIONS ENSURE THAT THEIR PERFORMANCE MANAGEMENT ACTIVITIES IN THE INTERNAL ENVIRONMENT ARE EFFECTIVE. STUDY PAGE 3 PRESCRIBED BOOKS. THEY MIGHT ASK ABOUT EXTERNAL ENVIRONMENT OR OTHER HR ACTIVITIES. THE TRICK IS TO BE ABLE TO EXPLAIN ALL. KNOW KEY ISSUES IN THE EXTERNAL ENVIRONMENT, INTERNAL AND OTHER HR ACTIVITIES AND NOT JUMBLE THEM AROUND, KNOW WHICH ONE BELONGS WHERE AND BE ABLE TO EXPLAIN IN DETAIL.QUESTION 3STUDY THE PURPOSES OF PERFORMANCE MANAGEMENT ON PAGE 14-18 PRESCRIBED BOOK, TOGETHER WITH YOUR WORKBOOK 1 ON PAGE 19. MAKE SURE YOU KNOW WHAT THE ROLE OF EACH PURPOSE IS.EXAMPLE:? IMPLEMENTATION OF REWARD SYSTEM BASES ON LAYOFFS AND MERIT INCREASES FALLS WITHIN THE ADMINISTRATIVE PURPOSE.Strategic purpose Performance management can help top management to achieve its strategic business objectives by linking the organizational goals with individual goals. Through the performance management process, the behavior of employees is reinforced to be consistent with the attainment of organizational goals, and the most important strategic initiatives are also communicated. Performance management also plays an important role in the onboarding process, where new employees are oriented to understand the organization’s culture and values and the behavior and results that are valued and rewarded. To help top management achieve strategic goalsAdministrative purpose Furnish valid and useful information for making administrative decisions about employees. Such as salary adjustments, promotions, employee retention, identification of poor performers.To furnish valid and useful information for making administrative decision about employeesInformational purpose PM systems serve as communication device. They inform employees about how they are doing and provide them with info on specific areas that may need improvementTo inform employees about how they are doing and about the orgs and supervisors expectationsDevelopmental purpose Managers can use feedback to coach employees and improve performance on an ongoing basis. Feedback allows for identification of strengths and weaknesses as well as the causes for performance deficiencies.Another aspect of developmental purpose is that employees receive info about themselves that can help tem individualize their career paths.To allow managers to provide coaching to their employeesOrganizational maintenance purpose To provide info to be used in workforce planning. It comprises of systems that allows orgs to anticipate and respond to needs emerging within and outside the organization, determine priorities, and to allocate human resources where they can do the most good.To provide info to be used in workplace planning and allocation of human resourcesDocumentation purpose PM systems allow orgs to collect useful info that can be used for several documentation purposes. First data can be used to validate newly proposed selection instruments.Second the recording of important administrative decisionTo collect useful information that can be used for various purposesQUESTION 4STUDY THE PERFORMANCE MANAGEMENT CONTRIBUTION ON PAGES 4-8 IN THE PRESCRIBED BOOK. THEY MIGHT SAY ADVANTAGES ASSOCIATED WITH THE IMPLEMENTATION OF?PERFORMANCE MANAGEMENT SYSTEM. DO NOT GET CONFUSED. IT’S THE SAME QUESTION JUST ASKED IN A DIFFERENT WAY. KNOW THE QUESTION IN DETAIL SO THAT YOU ARE ABLE TO LINK IT TO THE CASE STUDY.1. Motivation for future performance is increased 2. Self-esteem is increased through feedback about one’s performance 3. Managers and direct supervisors gain insight about persons being appraised 4. The job definition and criteria are clarified 5. Self-insight and development of participants are enhanced 6. Administrative actions and decisions are more fair and appropriate 7. Organizational and unit goals are made clear 8. Employee performance is improved and they become more competent 9. Employee misconduct is minimized and identified early 10. There is better protection from lawsuits because of documented compliance 11. There is a better and timelier differentiation between good and poor performers 12. Supervisor’s and manager’s views of performance are communicated more clearly 13. Organizational change is facilitated via performance improvement and cultural changes 14. Motivation, commitment and intentions to stay in the organization are enhanced 15. Voice behavior, involving suggestions for changes and improvement, is encouraged 16. Employee engagement is enhanced because employees feel involved and empowered QUESTION 5DISADVANTAGES/ DANGERS OF POORLY IMPLEMENTED PM SYSTEMS.ANSWERING THIS QUESTIONS READ NEGATIVE CONSEQUENCES ASSOCIATED WITH LOW-QUALITY AND POORLY IMPLEMENTED PM SYSTEMS ON PAGE 8 PRESCRIBED BOOK. WHETHER THEY ASK IT AS DISADVANTAGES?OR DANGERS DO NOT GET CONFUSED. READ IN DETAIL, BE ABLE TO ASSOCIATE IT WITH THE CASE STUDY/ PASSAGE WHICHEVER ONE THEY GIVE YOU.Increased staff turnover. False or misleading information may be used for rating. Self-esteem of employees may be lowered, due to inappropriate feedback. Time and money are wasted. Relationships are damaged. Motivation to perform is decreased. Employees may suffer from job burnout and dissatisfaction. Increased risk of litigation because of employees being appraised unfairly. Unjustified demands are made upon managers’ resources. Standards and ratings vary and are unfair. Biases can replace organizational standards. Mystery surrounds how ratings were derived. QUESTION 6CHARACTERISTICS OF IDEAL PERFORMANCE MANAGEMENT SYSTEMS.STUDY QUESTION 2 COMPULSORY ASSIGNMENTS 02 THAT YOU DID IN DETAIL AND PG 18-22 PRESCIBED BOOK. ALSO SUMMARISED NICELY ON PG 29-30 PRESCRIBED BOOK.NOTE: THIS ARE NOT EXAM QUESTIONS, THIS IS JUST TO GUIDE YOU ON HOW YOU MUST PREPARE FOR EXAM. THE TRICK WITH THIS SUBJECT IS TO KNOW YOUR THEORY WELL. DO NOT DO GUESS WORK, YOU WILL NOT SUCCEED WITH GUESSWORK. ?WHEN YOU DO NOT KNOW YOUR THEORY WELL YOU ARE GOING TO JUMBLE THINGS AROUND, WHAT WILL HAPPEN IS THAT THEY WILL ASK YOU TO PROVIDE PURPOSES AND YOU WILL GIVE CONTRIBUTIONS OR CHARACTERISTICS. I AM PLEADING WITH YOU, STUDY, STUDY AND STUDY WELL. IT WILL PAY OFF. THIS IS NOT A DIFFICULT SUBJECT AS MANY OF YOU ARE SAYING, JUST KNOW YOUR WORK.Congruent with the unit’s and organization’s strategy. Congruent with the organization’s culture, as well as the broader cultural context of the country. Thoroughness in terms of specified dimensions. Practicality in terms of cost, time and applicability. Meaningfulness in terms of the standards and evaluations for each job function. Specified, detailed and concrete guidance to employees about what is expected of them. Identifies effective and ineffective performance. Reliable and consistent performance measures. Valid measures of performance. Acceptable and fair for all participants. Transparent in terms of performance evaluation, performance standards and feedback. Inclusive of all the people affected by the outcome. Mechanisms in place to correct possible errors. Standardized systems. Compliance with ethical standards. Please include the following questions in your preparations for your exams.Draw up a diagram to illustrate the strategic planning process.Draw a diagram to show the linkages and the major issues employers face when designing performance-based pay within an integrated HRM System.Design a developmental plan for a Sales Representative in company ABC.WORKBOOK 2PERFORMANCE MANAGEMENT PROCESSQuestion 11. Discuss the different stages of the performance management process in organizations.NB: Know these stages in detail. Be able to know what happens in each stage.Example: they might give you a case study and ask you to identify stages that are not implemented in the case study. They will ask you to identify and discuss in detail referring to the case study.Prerequisite stageKnowledge of organization’s mission and strategic goalsLink organization’s strategic plans, unit strategic plans, job descriptions, individual & team performanceMission – Statement of what the organization is all aboutVision – Statement of where the organization intends to be in the long run, e.g. 10 yrs.Goals – Statement of what organization hopes to achieve in the medium – long range period (e.g. in next 3-5 yrs.)Strategies – Description of game plans or the how-to procedure in its endeavor to fulfil the mission, vision and goals. Can address issues of growth, survival, turnaround, stability, innovation and leadershipKnowledge of relevant jobJob analysisProcess of determining the key components of a particular job, incl. activities, tasks, products and processesJob analysis to obtain information on the task to be carried out and requiredKnowledgeSkillAbilitiesObtain information through observation, interview and questionnaire Result in:Job description – summaries job duties, KSAs and working conditions of specific jobJob specificationAlignment with organizational & departmental goals with individual goals by knowledge of different jobs in organization.Obtain knowledge of jobs by conducting job analysis & developing job descriptions Employees can then see impact their contributions have on the success of the organization as a whole.Performance planningPlanning between manager and employee – knowledge of performance management systemWhat needs to be done? (Required results)How? (Required behavior)DevelopmentResultsWhat needs to be done/ outcomes employee need to produce.Includes:Key accountabilities – areas for which employee is responsible (job description)Specific objectives employee needs to achieveDesired level of performancePerformance standardsMinimum acceptable level of performanceBehaviorHow a job is doneImportant – employee may not have control over results, but can control own behaviorIncludes discussion of competencies (measurable clusters of KSAs)Developmental PlanIdentify areas which need improvementStrengths and weaknessesSet goals to achieve each area to be improved – action planRequired componentsDescription of developmental objectivesActivities to be carried out to achieve objectives, inch resources/support requiredDate of completionPerformance executionEmployees have primary responsibility & ownershipPrimary responsibilities of employeesCommitment to goal achievementInvolve employee when organizational goals are setPeople tend to work hard if goals are clearEmployees should know how their contributions will lead to achievement of organizational goals – link job descriptions to organizational goals.Ask for on-going performance feedback & coachingCommunication with managerCollecting & sharing performance informationManager responsibilitiesObservation & documentation – keep track of employee performanceUpdates if goals changeFeedback on regular basisResources – ensure that employees are equipped with resources & opportunities to participate in development plan – supplies & fundingReinforcement – outstanding performance is noticed by reinforcing effective behavior. Regular feedback on negative performance - remedyPerformance assessmentEmployee & manager responsible for evaluating extent desired behavior & results achievedEvaluation of extent – developmental goals achievedPerformance reviewMeeting between employee & manager to review their assessment of employee’s performance – formal appraisal meeting (e.g. midyear review)Steps:Identify what the employee did well and poorly – cite specific behaviorEncourage good behavior by recognition and praiseAddress instances of poor performanceAsk feedback from employee about these types of behavior. Listen to reaction & explanationsDiscuss implications of changing or not changing.Explain to employee how skills used in past achievements can assist in overcoming current performance challengesAgree on action planEmployee encouraged to provide solutions that will lead to performance improvement.Schedule follow-up meeting & agree on behavior, actions and attitudes to be evaluated.Performance renewal and re-contractingUse insights & information obtained in previous stages to planPrerequisiteWhat goals were initially set? Were they clear?How are individual job descriptions linked to goals? Can it be improved?Performance planningReview behavior, results and developmental plans. Can it be improved?Performance executionReview obstacles which prohibited employees from achieving targeted performancePerformance assessmentDepends on type of assessment received.If on track – encourage to continueIf not – suggestions to improvePerformance reviewRewards or additional trainingEach of the six components of the PM process plays an important role. If any of these components is implementeed poortly than the entire perfomance management system suffers.Question 33.1 Identify the two main components of the performance management process and discuss theStages of the performance management process in which these two components are emphasized.?This definition is thus composed of 2 main components:Continuous Process: Performance Management is an ongoing. It involves a never ending process of setting goals and objectives, observing performance and receiving ongoing coaching and feedback. Once the end of the process is reached it starts all over again. Alignment with Strategic goals: Performance management requires managers to ensure that employees’ activities and output are congruent with the organization’s goals and consequently help the organization gain competitive advantage. Performance therefore creates a direct link between employee performance and organizational goals and makes the employee’s contribution to the organization explicit. Performance management systems that do not make explicit the employee’s contribution to the organizational goals are not true performance management systems.3.2 Analyze the role played by the process of job analysis in the implementation of a performance management system.?Job analysis helps us obtain information regarding the tasks carried out and the knowledge, skills and abilities required of a particular jobA job analysis allows for the determination of the key components of a particular job: what tasks need to be done, how they should be done, a what KSAs are needed.If we have good information regarding a job, then it is easier to establish criteria for job success.Knowledge of relevant jobJob analysisProcess of determining the key components of a particular job, incl. activities, tasks, products and processesJob analysis to obtain information on the task to be carried out and requiredKnowledgeSkillAbilitiesObtain information through observation, interview and questionnaire Result in:Job description – summarise job duties, KSAs and working conditions of specific jobJob specificationAlignment with organizational & departmental goals with individual goals by knowledge of different jobs in organization.Obtain knowledge of jobs by conducting job analysis & developing job descriptions Employees can then see impact their contributions have on the success of the organization as a whole.3.3 Discuss why job analysis is essential for the development of a performance management and feedback system.Job analysis has to be applied to understand the job in question. Job analysis refers to a process of determining the key components of a particular job, including activities and processes. It is in fact a prerequisite of any performance management system. Without a job analysis it is difficult to understand what constitutes the required duties for a particular job.Knowledge of the job in questionThis is done due to the process of job analysis (process of determining the key component of a particular job, including activities and processes). This is a pre-requisite for any PM process as it is difficult to understands what constitutes the required duties for a particular job, without it, neither do we know what needs to be evaluated or how to do so. The 2 products of a job analysis are the job description (Knowledge, skills and abilities, KSA’s and working conditions of a particular job) and the job specification. A job analysis is commonly done by way of observation, interview an questionnaire. WORKBOOK 3STRATEGIC PERFORMANCE MANAGEMENTQUESTION 1DEFINE CRITICAL SUCCESS FACTOR (CSF)?AND KEY PERFORMANCE INDICATORS AND JUSTIFY THEIR ROLE IN THE PERFORMANCE MANAGEMENT SYSTEM.CSF – management term for an element that is necessary for the organization to achieve its mission. It is a critical factor or activity required for ensuring the success of the company. Critical success factors are elements that are vital for a strategy to be successful and the elements drive the strategy forward. SCF provides a qualitative description of an element of the strategy in which the organization has to excel in order to be successfulKPI - are measures that quantify strategic objectives along with a target ant that enable the measurement of strategic performanceThe use of DSF and KPI’s enables measurement in the strategic performance management system and thus control of strategic objectives. If these performance factors and indicators that measure execution of the strategy and the creation of value, are not included in the performance management process it will remain unclear whether the strategic objectives a value creation are being achieved or not.QUESTION 2WHICH KEY PERFORMANCE INDICATORS (KPIs) SHOULD BE USED TO MEASURE THE PERFORMANCE OF THE RESTAURANTS?Speed of serviceQuality of serviceQuality of food Cleanliness of restaurants and restroomsDisplaying of promotional materialFinancial results/financial results improving consistently over timeQUESTION 3DISCUSS STEPS IN THE STRATEGIC PLANNING PROCESS IN DETAIL. WORKBOOK 03 PG 46NB: KNOW HOW TO DRAW A DIAGRAM AS WELL AS WHAT HAPPENS IN EACH STEP. IN CASE THEY ASK EITHER ONE.QUESTION 44. PROVIDE A LINK BETWEEN PERFORMANCE MANAGEMENT TO THE STRATEGIC PLAN THROUGH A DIAGRAM.NB: STUDY A DIAGRAM ON PAGE 62 CAREFULLY; BE ABLE TO EXPLAIN THE LINK FROM ORGANISATION’S STRATEGIC PLAN, UNIT STRATEGIC PLAN, JOB DESCRIPTION AND INDIVIDUAL AND TEAM PERFORMANCE.QUESTION 55. BRIEFLY ELABORATE ON THE PURPOSES OF STRATEGIC PLANNING. * Helps define the organizations identity* Helps organization’s prepare the future* Enhances ability to adapt to environmental changes* Provides focus and allows better allocation of resources* Produces an organizational culture of cooperation* Allows for the consideration of new options and opportunities* Provides employees with information to direct daily activitiesQUESTION 66. THE PRESENCE OF A STRATEGIC PLAN GUARANTEES THAT PERFORMANCE MANAGEMENT WILL BE EFFECTIVE. ELABORATE BRIEFLYStrategic planning is a process that involves describing the organizations destination, assessing barriers that stand in the way of that destination, and selecting approaches for moving forward. The main goal of strategic planning is to allocate resources in a way that provides the organization with a competitive advantage. A strategic plan serves as a blueprint that defines how thee organization will allocate its resources in pursuit of its goals.It serves the following purposes:Helps define the organization’s identityHelps organization’s prepare the futureEnhances ability to adapt to environmental changesProvides focus and allows better allocation of resourcesProduces an organizational culture of cooperationAllows for the consideration of new options and opportunitiesProvides employees with information to direct daily activitiesPerformance management systems must rely on the strategic plan to be useful. The behaviors, results and developmental plans of all employees must be aligned with the vision, mission, goas, and strategies of the organization and unitThe process of creating a strategic plan begins with an environmental analysis, which considers internal (org structure, process) as well as external (economic, technological) trends.Internal trends can be classified as either strengths or weaknesses, and external trends can be classified as either threats or opportunities. A gap analysis consists of pairing strengths and weaknesses with opportunities and threats and determining whether the situation is advantageous, disadvantageous or somewhere in between.Mission statement:A mission statement defines why the organization exists, the scope of its activities, the customers served, ant the products and services offeredVision statement:Gives a description of future aspirations and emphasizes the future. The strategic plan, including mission, vision, goals and strategies, cascades down to all organizational levels, thus each division or unit also creates its own strategic plan which should be consistent with the organizations overall plan. The various choices in designing thee performance management system are directly affected by an organizations strategic plan. Different missions and visions lead to different types of systems, for example, emphasizing behaviors as opposed to management must be aware that the performance management system is a primary tool to execute an organizations strategic plan. This awareness will lead to top managements support for the system.Workbook 04 summarizedSTUDYDeterminants of performance and performance dimensions.Aguinis (2014:89-90) highlighted factors called determinants of performance. These factors allow some people to perform at higher levels than others.Be able to explain these factors in detail. Declarative, Procedural and Motivation.DeclarativeDeclarative knowledge is information about facts and things, including information regarding a given tasks requirements, labels, principles and goals.ProceduralThis is the combination of knowing what to do and how to do it and it includes cognitive, physical, perceptual, motor and interpersonal skills.MotivationMotivation involves three types of choices, namely:The choice to expend effort (e.g. I will go to work today)The choice of level of effort (e.g. I will put in my best effort at work vs I will not try very hard)The choice to persist in the expenditure of that level of effort (I will give up in a little while vs I will persist no matter whatIn order for performance to reach high levels, all three determinants of performance must be present. In other words, these three determinants have the following multiplicative relationship:Performance= declarative knowledge x procedural knowledge x motivationFind them in workbook 04 pg 58 and pg 89-94 prescribed.There are also factors that have an influence on the determinants of performance. These are:The employees (abilities and previous experience)Human resources (HR? practices)The work environmentPerformance dimensions:Performance is multidimensional, meaning that we need to consider many different types of behaviors to understand performance. Although we can identify many specific behaviors, two types of behaviors or performance facets stand out: Tasks performance and contextual performance.Contextual and task performance must be considered separately because they do not necessarily occur in tandem. An employee can be highly proficient at her task, but be an underperformer regarding contextual performance:Task performance Task performance is activities that transform raw materials into the goods and services that are produced by the organizationIt is activities that help with the transformation process by replenishing thee supply of raw materials, distributing its finished products or providing important planning coordination, supervising, or staff functions that enable the organization to function effectively and efficiently.Contextual performanceContextual performance is defined as those behaviors that contribute to the organization’s effectiveness by providing a good environment in which task performance can occur. It includes behaviors such as:Persisting with enthusiasm and exerting extra effort as necessary to complete one’s own task activities successfully (being punctual and rarely absent)Volunteering to carry out task activities that are not formally part of the job (suggesting org improvements, making constructive suggestions)Helping and cooperating with others (assisting and helping coworkers and customers)Following organizational rules and procedures (following orders and regulations, respect for authority, complying with org values)Endorsing, supporting and defending org objectives (org loyalty, representing org favorably to outsiders)Both task and contextual performance are important dimensions to take into account in performance management systems.Example: Without getting to the bottom of the problem as to why Dipuo is underperforming, David as the manager jumps into the conclusion that the solution to the problem is to provide Dipuo with training. Is David’s approach correct?Approach to the question: look at pg 58 Workbook 04, when managers address performance problems their first point of departure should be addressing factors that have an influence on the determinants of performance, to see which of these factors are hampering performance and then help employees improve their performance. They must determine is the source of the problem declarative, procedural or motivation. For example if an employee lacks motivation but the manager believes the source of the problem is declarative knowledge, the manager may send the employee to a company-sponsored training program so she can acquire the knowledge which is presumably lacking. This would be a waste of time and resources for the individual and the company like in Dipuo’s case. This is why performance management systems need not only measure performance but also to provide information about the source of any performance deficiencies. ?Additional reading pg 90-91 prescribed.2. Performance dimensions (read in detail on pg 91-92 Prescribed) main differences between Task and Contextual also highlighted on pg 92 prescribed.Task performance- usually included in one’s job descriptionContextual performance- usually not role prescribed, instead typically expected even though they are not explicit.Explain why it is important to focus on both task and contextual performance in organizations. Read TRW case study on page 92 and the discussion on page 93 in the prescribed book to answer this question.NB: Do not confuse performance determinants and performance dimensions.3. APPROACHES TO MEASURE PERFORMANCEWhen measuring task performance and contextual performance, organizations can use three approaches to measure performance: the behavior, results and trait approaches Study pages 87–104 of chapter 4 in the prescribed book.Trait approachEmphasis the individual performer and ignores the specific situation, behavior and results. The problem with this is that traits are not under the control of individuals and the fact that an individual possess a certain trait does not mean that this trait will necessarily lead to desired results or behavior. This approach is not fair on employees. Example:Trait approach can be fruitful: as part of its business strategy, an org may anticipate drastic structural changes that will lead to the reorganization of most functions and the resulting reallocation of employees. In such a circumstance, it may be useful to assess the traits possessed by the various individuals so that far and appropriate decisions are made regarding the allocation of resources across the newly created organization. In most organizations performance is not measured using the trait approach.Behavioral approachThis approach emphasizes what an employee does on the job and does not consider employees traits or the outcomes resulting from their behavior. This is a process-orientated approach that emphasizes how an employee does the job.This approach is most appropriate when:The link between behavior and results is not obviousOutcomes are attained in the distant futurePoor results are due to causes beyond the performers controlExample: consider a situation involving two assembly-line workers, one of them working day shift and the other night shift. When the assembly line gets stuck due to technical problems, the employee working during the day receives immediate technical assistance, so the line is back in motion in less than five minutes. But the night shift employee has very little technical support and therefore, when the assembly line breaks down, it takes about 45 minutes for it to be up and running. If we measured results, we would conclude that the performance of the day-shift employee is far superior to that of the night-shift employee, but this would be incorrect. Both may be equally competent and do the job equally well. The results are uneven because they depend on the amount and quality of technical assistance they receive when the assembly line is stuckResults approachThis approach emphasizes the outcomes and results produced by the employee. Bottom line approach. It does not consider the traits that an employee may possess.The results approach is most appropriate under the following circumstances:Workers are skilled in the needed behaviour (e.g. appropriate when workers have the necessary knowledge and skills to do the work)Behaviour and results are obviously related (e.g. certain results can be obtained only if worker engages in certain specific behaviors) such as a line-worker involving repetitive work.Results show consistent improvement over time (when results improve consistently over time it shows that workers are aware of behaviors needed to complete job)There are many ways to do the job right (when there are different ways in which one can do the task required)Question3.1.Be able to Distinguish between the three approaches to measuring or evaluating performance and provide a practical example of each.3.2.Study pages 95–96 in the prescribed book. Be able to Elaborate on the circumstances when the behaviour approach should be applied and provide examples.Be able to Elaborate on the circumstances when results approach should be applied and provide examples.Challenges that organizations emphasizing the measurement of traits approach only face.3.3. In some cases you will be asked to provide an example of the suitable approach from the case study and provide two other approaches which can also be used and explanation of the approaches.3.4. Know which approach you will use in case they ask you to:??? Discuss approach and criteria most appropriate for: fast food industry???????????????????????????????????????? ????????????????????????????????????????????: Motor industry??????????????????????????????????? ?????????????????????????????????????????????????: Sales industryAnd give reason for your answer.Example: Michelle is a regional manager at a fast-food restaurant franchise in South Africa. Her job is to visit the different restaurants in the group and to rate the speed and quality of their service, the quality of the food, the cleanliness of restaurants and restrooms, properly displayed promotional materials and the financial results of the restaurants.3.5. Which approach would be most suitable to measure Michelle’s performance?3.6 Which performance criteria should be used to measure Michelle’s performance?Answers3.5 Results approach. Motivate the following this approach?3.6 The performance criteria will include:speed of servicequality of servicequality of foodcleanliness of restaurants and restroomsdisplaying of promotional materialfinancial results/financial results improving consistently over timeNote: Approach and Criteria is not?the same?thing. They are two different concepts. Do not confuse the two. When you are asked for approach provides approach, criteria is the measure you would use to evaluate the performance.?Methods for measuring performanceBahavioural- based methods, Results-based methods and Trait-based methodsWhen an organization chooses a behavioural approach to measure performance, it should include the assessment of petencies can be described as measurable clusters of knowledge, skills and abilities (KSAs) that are critical in determining how results are achieved.Two systems that are used to evaluate competencies:Comparative systemsRankingPaired comparisonForced distributionAbsolute systemsNarrative essaysBehavioural checklistGraphic rating scalesBehaviourally anchored rating scales (BARS)Behaviour observation scale (BOS)Behavior method:MethodDescriptionAdvantageDisadvantageNarrative Essayevaluator writes down the employee’s strengths, weaknesses and potential, together with suggestions for improvementProvides detailed feedback regarding performanceComparison is almost impossible, different essays focus on different aspects, results could also depend on writing skill of the raterRankingevaluator ranks employee from best to worst in terms of an overall criterionQuick and fairly easy when a small number of employees are involvedDifficult for groups >20 & perf. Diff. are not indicated, top & worst easy to identify but middle not. Paired comparisonEach employee is compared with every other employee with reference to ability to execute a task. The number of times an employee is preferred determines position on raking order scaleUseful for purposes of salary administration. Provide little basis for individual feedback and developmentForced distributionRating in fixed categoriesAvoids clusteringLead to employee resentmentBehavioural checklistEvaluator provided with a series of statements that describes job related behaviour, choose words that best describe the employees behaviour, and then added upGraphic rating scaleRate against a list of characteristicsResults expressed in quantitative terms, more than one performance dimension and facilitate comparisonVery time consuming to develop and sometimes dimensions or scale points are not defined clearlyBehaviourally anchored rating scales (BARS)Makes use of critical incidents as anchor statements on a scale. Define the dimension to be rated in behavioural terms & use critical incidents to describe various levels of performanceVery time consuming to developResults method:MethodDescriptionAdvantageDisadvantageManagement by objective (MBO)Relies on goal setting to est. objectives. Measure of each employee’s contribution to the success of the org. Meet to agree on objectivesDev plans – how and whenAgree on yardstick to measure Cascading process allows success of employees, managers and the organization as a wholeShort term orientedLittle insight to employee behaviourDoes not facilitate comparisonWork Planning and reviewSimilar to MBO, but places greater emphasis on the periodic review of work plans to identify goals attained; problems encountered and need for training. Based more on judgment than objectivesFrequent review of work plansTime consuming to implement properly and does not facilitate comparison across employeesBalanced Scorecard (BSC)BSC allows managers to look at BU from 4 perspectives:CustomerInternalInnovation & learningFinancial Managers translate company goals into specific measures that reflect factors that matter. Employees can then see clearly how performance is aligned with performance of companyBrings together many of competitive elementsIt enables managers to translate broad corp coals into divisional, departmental and team goalsThe BSC is neither a flawless nor a simple performance management systemProductivity measurescan be used to evaluate:salespeople on basis of their sales volume (incl nr of units sold and value)production workers on basis of nr of units produced and the nr of defects detectedexecutives on the basis of company profits or growth rateThese measures directly align employees accomplishments with org goalsProductivity figures can be contaminated by external factors beyond the employee control.Jobs that are more service orientated, production or sales figures are not enough. Factor such as initiative and cooperation should be included as performance standards.Trait MethodEmphasis the individual performer and ignores the specific situation, behaviour and results. The problem with this is that traits are not under the control of individuals and the fact that an individual possess a certain trait does not mean that this trait will necessarily lead to desired results or behaviour. This approach is not fair on employees. MethodDescriptionAdvantageDisadvantageMixed standard scalesModification of basic rating scale method. Rater is given three specific descriptions of each trait.Descriptions reflect 3 levels of performance:Superior, average, inferiorDescriptions of traits are written down and are randomly sequenced to form mixed standard scale. Supervisors evaluate employees by indicating whether employee is better than, equal to, worse than standard performanceEmployees may feel that a system based on traits is not fair because the development of these traits is usually beyond their controlForced-choiceRater chooses from statements, which are often in pairs that appear equally favorable or equally unfavorable. Is designed to distinguish between successful and unsuccessful performance. Rater selects one statement from the pair without knowing which stamen correctly describes successful job behaviorCost and time of establishing and maintaining its validity.Employees may feel that the system is not fair.Results based methodsWhen an organization chooses a results approach performance, the following factors should be determined beforehand: key accountabilities, performance objectives and performance standards.Results based methodsManagement by objectivesWork planning and reviewThe Balanced Scorecard (BSC)Productivity measuresNB: Explain each method and know advantages and disadvantage of each methodTrait based methodsMixed standard scalesForced choice methodNB: Explain each method and know the disadvantage of each method, no advantages for this method.Know when to use these methods. Look at the feedback in workbook 04, activity 4.11 to help you with this answer.When should each technique be used?Cascio (2006) points out that no method is perfect, and that the choice of a rating method should be made by looking at the relevance and acceptability of the rating system. The following advice, which is based on systematic comparisons of the various methods, is given by Cascio:If the objective is to compare employees across raters for important employment decisions (eg promotions, merit pay), do not use MBO or work planning and review. They are not based on standardized rating schemes for all employees. If BARS is used, a diary should be kept during the process. This will improve the accuracy of the ratings, and will help managers distinguish between efficient and inefficient employees.If objective performance data is available, MBO is the best strategy to use. Work planning and review is not as effective as MBO under these circumstances. In general, appraisal methods that are best in a broad, organizational sense – BARS and MBO – are most difficult to use and maintain.Methods that focus on describing, rather than evaluating, behaviour (eg BARS, summed rating scale) produce results that are the most interpretable across raters. They help remove the effects of individual differences in raters.No rating method has been an unqualified success when used as a basis for merit pay and promotional decisions.When certain statistical corrections are made, the correlations between scores on alternative rating formats are very high5. Gathering performance information (Study table on pg 69-70 workbook 4;? pg 150-153 prescribed). Know the importance of each source in providing information and advantages and disadvantages of each. Example activity workbook 04 pg 716.Sources of performance information SupervisorsPeersSubordinatesSelf-appraisalsCustomersIn most organizations the manager is the primary source of performance information because the manager observes employees directly and has good knowledge of performance standards. However, there are also alternative sources of information such as peers, subordinates, self and customers. Because these sources see different aspects of a person’s performance, the use thereof during the performance review offers an effective and credible way to obtain feedback. This allows the manager to assume more of a coaching and mentoring role, helping to interpret the feedbackManagerBest position to evaluate performance in relation to strategic org. goals. Also make decisions about rewards associated with performance evaluation. Most important source as they are knowledgeable about strategic issues, understand performance and are usually in charge of managing employee performanceManagers however are not always the most effective sources of information as managers may not observe subordinates performance on a regular basis and therefore other sources need to be considered.Performance appraisals given by managers may evaluate performance based on whether the rate is contributing to goals valued by the manager rather than goals valued by the org. as a whole which further justifies the use of the other sources. PeersPeers can provide a perspective on performance that is different from that of immediate managers. Anguinis is of the opinion though that peer evaluation suffers the following weaknesses:Not readily accepted when employees believe there is a friendship biasPeers are less discriminating among performance dimensions than are managersThey are likely to be affected by “context effect”SubordinatesSubordinates are a good source of information regarding the performance of their managers. More accurate when the resulting ratings are to be used for developmental purposes rather than administrative purposes. Confidentiality is the key if subordinates are to be used as a source of performance information. SelfBased on the idea that employees are most familiar with their work and that their involvement is essential. When employees are given the opportunity to participate in the PM process, their acceptance of the resulting decision is likely to increase and their defensiveness during the appraisal during the interview is likely to decrease. Employees are also in a position to keep track of activities during the review period, whereas managers may have to keep track of the performance of several employees. Casio identifies the following as common disadvantages of self-appraisal:They tend to be too lenientThey are less variableThey are more biasedThey tend to show less agreement with the judgment of the othersAguinis suggests the following to improve the quality of self-appraisals:Use comparative as opposed to absolute measurementAllow employees to practice their self-rating skillsAssure confidentialityEmphasis the futureCustomersPerformance information from Customers is suitable for jobs that require a high degree of interaction with the public or with particular job-related individuals. Performance information can also be collected from internal customers. Useful regarding promotions, transfer and need for training. 7. Rater errors(Study pg 71 workbook 04 and 183-189 prescribed)You might be given a passage or case study requiring you to indicate rater errors from the passage/case study and explanation thereof. Read and understand the circumstances under which rating errors occur.Evaluating human behaviour will always be a subjective process. Rater’s memories are fallible and their ratings are done according to their own sets of preferences, expectations, relationship with the employee and person objectives. The information used for evaluation will never be totally complete and accurate, and sometimes the performance criteria are not clearly mon rating errors found in many performance appraisals:Rater biasThis error occurs when a rater’s values or prejudices distort the rating. These biases are not related to job performance and may stem from personal characteristics such as age, sex, disability or race, or from organization-related characteristics like seniority or team membership.StereotypingStereotyping occurs when thee appraiser has an oversimplified view of individuals based on group membership, making judgments about a group of people, instead of openly identifying the features of the individual.Halo effectThe halo effect occurs when the rater fails to distinguish between different aspects of performance being rated, rating an employee high on all items because of good performance in one area. A negative halo also occurs, when thee supervisor allows one negative behavior of an employee to cloud thee objectivity regarding ratings on the employee’s behaviours.Central tendencyThis error occurs when employees are incorrectly rated near the average or middle of scale while the extremes are avoided. The result is that most of the employees are rated as average. This is also an intentional type of error and is mainly caused by the supervisors desire to play it save.LeniencyRaters assign undeserved high (lenient) evaluations to most of the employees. In practice this comes down to artificial rating inflation.StrictnessWhen supervisor assigns low ratings to most or all employees though some employees may have achieved average or above-average performance levels.Recency effectWhen a performance appraisal is based mainly on the employee’s recent performance (info gathered towards end of review period)Primacy effectThe primacy effect occurs when performance appraisal is influenced mainly by performance displayed during the initial phases (beginning) of review period.8. THERE are strategies that can be used to reduce appraisal errors and improve rater accuracy. These are summarised on pg 72 WORKBOOKS 04.They might ask you how company ABC can reduce rating errors, that’s where you provide strategies and explain them.There are intentional and unintentional rating errors. Follow the link on Activity 4.13 pg 72 workbooks 04 to read more about those.Making precise rating scale formats – each performance dimension focuses on a single activity, each performance dimension is rated separately and scores are then summed to determine overall ratingProvide memory aids through electronic diary-keeping software – Behaviours and results relevant to employee performance should be recorded regularly. By consulting behaviour diary or critical incident file before rating, will reduce recently and primary errors, which can lead to more accurate ratingProviding rater training – training should be focused on improving rater’s observation skills, improving rater’s judgments and increasing rater objectivity. Training should teach raters the relevant criteria to use, the relevant behaviours to observe, as ways to reduce errors.Rewarding accurate and timely appraisals – Evaluations done in a timely, accurate and fair manner should be rewarded.Using multiple raters – many of the biases and errors that affect rating accuracy negatively, relate to individual characteristics and experiences that vary across people. These biases and errors tend to be diluted or cancelled out, and the responsibility if diffused when multiple raters are used. ................
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