Performance Management

# 1.1

Employee Performance

What is expected of an employee in terms of

- Quantity of output

- Quality of output

- With specification of conditions under which it is to be achieved (eg. Timeliness of output, Presence at work, Cooperativeness etc)

Dimensions of Performance

• Output/results dimension

• Inputs dimension

• Time dimension

• Focus dimension

• Quality dimension

• Costs dimension

Neglected Aspect: Performance is Dyadic

Performance Management

“Processes used to identify, encourage, measure, evaluate, improve, and reward employee

performance.”

What is Individual Performance Management?

• Continual cycle of managing your employees’ performance by:

– Establishing and communicating the expectations of work objectives and level of performance with the employee

– Monitoring and providing feedback on an on-going basis on the employee’s activities, accomplishments, impact ,and results

– Setting professional training and development opportunities for the employee

– Evaluating, rating, and formally documenting feedback on the individual employee’s performance

– Acknowledging individual employee’s performance and contribution in a timely manner

5

Rewarding

Planning & Setting Goals & Performance Measures

Monitoring & Providing Ongoing Feedback

Developing &Training

Evaluating & Rating

Key Components of the StaffPerformance Management Cycle

Performance Management Process

Review&

Measurement

PerformancePlanning

Training&

Development

Reinforcements&

Rewards

MaximizeProductivity

&Performance

Benefits of Performance Management

#1.2#1.2

Benefits to Organizations

• Improved productivity/profitability• Reduced costs and wastage• Enhanced quality• Improved motivation• Customer satisfaction• Public recognition• Competitive advantage

Benefits to Managers

• Know your staff better: Enable managers to communicate with staff

• Improvements in individual performance and contributions to the team

• Discuss new task and targets• Acquire up-to-date information on

current skills and expertise of employees• Provide justification for merit increases,

financial rewards and benefits• Provide information and potential

justification for disciplinary actions

Benefits to Employee• Clarify job requirements, future tasks

and targets• Provide a channel for feedback• more understanding and support from

manager• Develop those skills that are critical to

good job performance• Objective basis for rewards• Opportunities for career growth/

development

Performance Appraisal

Performance Appraisal

• Performance Appraisal“The process of evaluating how well employees perform

their jobs when compared to a set of standards, and then communicating the information to employees.”

• Formal Appraisal (PA)– Performance Appraisal – The formal periodic

assessment of workers performance (normally annually)

• Informal Appraisal• Day-to-day contacts, largely undocumented

Synonyms of Performance Appraisal

• performance review

• performance evaluation

• personnel rating

• merit rating

• employee appraisal

• employee evaluation

Performance Appraisal Process

Performance Appraisal Problems

• Lack of standards; irrelevant, subjective,

unrealistic standards• Poor measures of performance• Rater errors• Poor feedback to employees e.g.. arguing• Failure to use evaluation results for decision

making

• Lack of standards; irrelevant, subjective,

unrealistic standards• Poor measures of performance• Rater errors• Poor feedback to employees e.g.. arguing• Failure to use evaluation results for decision

making

Performance Appraisal Process

-unclear standards

-halo effect

-central tendency

-leniency/strictness

-appraisal bias

-recency effect

-similar-to-me bias

-unclear standards

-halo effect

-central tendency

-leniency/strictness

-appraisal bias

-recency effect

-similar-to-me bias

Rating Scale Problems