Management PrinciplesManagement Principles

Craig W. Fontaine, Ph.D.Craig W. Fontaine, Ph.D.

Performance ManagementPerformance Management

Identifying and MeasuringIdentifying and MeasuringEmployee PerformanceEmployee Performance

Identifying and MeasuringIdentifying and MeasuringEmployee PerformanceEmployee Performance

Performance Management System– Processes used to identify, encourage,

measure, evaluate, improve, and reward employee performance.

Performance– What an employee does and does not do.

• Quantity of output • Quality of output• Timeliness of output • Presence at work• Cooperativeness

Job Criteria– Important elements in a given job

Linkage Linkage Between Between Strategy, Strategy,

Outcomes,Outcomes,and and

Organizational Organizational ResultsResults

Linkage Linkage Between Between Strategy, Strategy,

Outcomes,Outcomes,and and

Organizational Organizational ResultsResults

Types of Performance InformationTypes of Performance InformationTypes of Performance InformationTypes of Performance Information

Trait-basedTrait-basedInformationInformation

Trait-basedTrait-basedInformationInformation

Behavior-basedBehavior-basedInformationInformation

Behavior-basedBehavior-basedInformationInformation

Results-basedResults-basedInformationInformation

Results-basedResults-basedInformationInformation

JobJobPerformance?Performance?

JobJobPerformance?Performance?

Performance StandardsPerformance StandardsPerformance StandardsPerformance Standards

Performance Standards– Expected levels of performance

• Benchmarks• Goals• Targets

Characteristics of Well-defined Standards– Realistic– Measurable– Clearly understood

Terms Defining Standards on One CompanyTerms Defining Standards on One CompanyTerms Defining Standards on One CompanyTerms Defining Standards on One Company

Uses of Performance AppraisalUses of Performance AppraisalUses of Performance AppraisalUses of Performance Appraisal

Performance Appraisal (PA)– The process of evaluating how well

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

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

– Systematic Appraisal• Formal contact at regular time intervals, usually

documented

Uses of Performance Appraisal (cont’d)Uses of Performance Appraisal (cont’d)Uses of Performance Appraisal (cont’d)Uses of Performance Appraisal (cont’d)

PerformancePerformanceAppraisalAppraisal

PerformancePerformanceAppraisalAppraisal

Giving Performance Giving Performance FeedbackFeedback

Giving Performance Giving Performance FeedbackFeedback

Administering Wages Administering Wages and Salariesand Salaries

Administering Wages Administering Wages and Salariesand Salaries

Identifying Strengths Identifying Strengths and Weaknessesand Weaknesses

Identifying Strengths Identifying Strengths and Weaknessesand Weaknesses

Conflicting Roles for Performance AppraisalConflicting Roles for Performance AppraisalConflicting Roles for Performance AppraisalConflicting Roles for Performance Appraisal

Uses of Performance Appraisal (cont’d)Uses of Performance Appraisal (cont’d)Uses of Performance Appraisal (cont’d)Uses of Performance Appraisal (cont’d)

Criticisms of Performance Appraisal– Focus is too much on the individual and does

little to develop employees.– Employees and supervisors believe the

appraisal process is seriously flawed.– Appraisals are inconsistent, short-term

oriented, subjective, and useful only at the extremes of performance.

Traditional Performance Traditional Performance Appraisal:Appraisal:

Logic and ProcessLogic and Process

Traditional Performance Traditional Performance Appraisal:Appraisal:

Logic and ProcessLogic and Process

Newest Best - 360 Degree AppraisalsNewest Best - 360 Degree AppraisalsNewest Best - 360 Degree AppraisalsNewest Best - 360 Degree Appraisals

Potential Issues – Peer RatingsPotential Issues – Peer RatingsPotential Issues – Peer RatingsPotential Issues – Peer Ratings

Advantages– Peers have opportunity

to observe other peers.

Disadvantages– Can negatively affect

working relationships.

Potential Issues - Employee Rating of ManagersPotential Issues - Employee Rating of ManagersPotential Issues - Employee Rating of ManagersPotential Issues - Employee Rating of Managers

Advantages– Helps in identifying

competent managers– Serves to make

managers more responsive to employees

– Can contribute to the career development of managers

Disadvantages– Negative reactions by

managers to employee ratings

– Subordinates’ fear of reprisals may inhibit them from giving realistic (negative) ratings

Performance Appraisal MethodsPerformance Appraisal MethodsPerformance Appraisal MethodsPerformance Appraisal Methods

Category Rating MethodsCategory Rating MethodsCategory Rating MethodsCategory Rating Methods

Graphic Rating Scale– A scale that allows the rater to indicate an

employee’s performance on a continuum.• Job criteria scales• Behavioral scales

– Drawbacks• Restrictions on the range of possible rater responses• Differences in the interpretations of the meanings of

scale items and scale ranges by raters• Poorly designed scales that encourage rater errors• Rating form deficiencies that limit the effectiveness of

the appraisal

Category Rating Methods (cont’d)Category Rating Methods (cont’d)Category Rating Methods (cont’d)Category Rating Methods (cont’d)

Checklists

– A performance appraisal tool that uses a list of statements or work behaviors that are checked by raters.• Can be quantified by applying weights to individual

checklist items.

– Drawbacks• Interpretation of item meanings by raters

• Weighting creates problems in appraisal interpretation

• Assignment of weights to items by persons other than the raters

Comparative MethodsComparative MethodsComparative MethodsComparative Methods

Ranking– Listing of all employees from highest to

lowest in performance.– Drawback

• Does not show size of differences in performance between employees

• Implies that lowest-ranked employees are unsatisfactory performers.

• Becomes an unwieldy process if the group to be ranked is large.

Comparative Methods (cont’d)Comparative Methods (cont’d)Comparative Methods (cont’d)Comparative Methods (cont’d)

Forced Distribution– Performance appraisal method in which

ratings of employees are distributed along a bell-shaped curve.

– Drawbacks• Assumes a normal distribution of performance.• Resistance by managers to placing individuals in the

lowest or highest groups.• Providing explanation for placement in a higher or

lower grouping can be difficult.• Is not readily applicable to small groups of employees.

Forced Distribution on a Bell-Shaped CurveForced Distribution on a Bell-Shaped CurveForced Distribution on a Bell-Shaped CurveForced Distribution on a Bell-Shaped Curve

Figure 11–9

Narrative MethodsNarrative MethodsNarrative MethodsNarrative Methods

Critical Incident– Manager keeps a written record of highly

favorable and unfavorable employee actions.– Drawbacks

• Variations in how managers define a “critical incident”• Time involved in documenting employee actions• Most employee actions are not observed and may

become different if observed• Employee concerns about manager’s “black books”

Narrative Methods (cont’d)Narrative Methods (cont’d)Narrative Methods (cont’d)Narrative Methods (cont’d)

Essay Method– Manager writes a short essay describing an

employee’s performance.– Drawbacks

• Depends on the managers’ writing skills and their ability to express themselves.

Field Review– Outside reviewer interviews the manager

about the performance of each employee and develops a rating for the employees from the interview notes.

Behavioral/Objective MethodsBehavioral/Objective MethodsBehavioral/Objective MethodsBehavioral/Objective Methods

Behavioral Rating Approach– Assesses employees’ behaviors instead of

other characteristics– Consists of a series of scales created by:

• Identifying important job dimensions• Creating statements describing a range of desired and

undesirable behaviors (anchors)

– Types of behavioral scales• Behaviorally anchored rating scales (BARS)• Behavioral observation scales (BOS)• Behavioral expectation scales (BES)

Customer Service Skills (BOS)Customer Service Skills (BOS)Customer Service Skills (BOS)Customer Service Skills (BOS)

Management by ObjectivesManagement by ObjectivesManagement by ObjectivesManagement by Objectives

Management by Objectives– Specifying the performance goals that an

individual and his or her manager agree to try to attain within an appropriate length of time.

Key MBO Ideas– Employee involvement creates higher levels

of commitment and performance.– Encourages employees to work effectively

toward achieving desired results.– Performance measures should be

measurable and should define results.

Common Rater ErrorsCommon Rater ErrorsCommon Rater ErrorsCommon Rater Errors

Performance Appraisals and the LawPerformance Appraisals and the LawPerformance Appraisals and the LawPerformance Appraisals and the Law

Legally Defensible PA System– Appraisal criteria based on job analysis– Absence of disparate impact and evidence of

validity– Formal evaluation criterion that limit managerial

discretion– Formal rating instrument linked to job duties and

responsibilities– Personal knowledge of and contact with ratee– Training of supervisors in conducting appraisals– Review process to prevent undue control of

careers– Counseling to help poor performers improve

Performance Management SystemPerformance Management SystemPerformance Management SystemPerformance Management System

Effective PMS systems are:– Consistent with the strategic mission of the

organization– Beneficial as development tool– Useful as an administrative tool– Legal and job-related– Viewed as generally fair by employees– Effective in documenting employee

performance

Competency ModelsCompetency ModelsCompetency ModelsCompetency Models

Effective PMS systems are:– Consistent with the strategic mission of the

organization– Beneficial as development tool– Useful as an administrative tool– Legal and job-related– Viewed as generally fair by employees– Effective in documenting employee

performance

Competency ModelsCompetency ModelsCompetency ModelsCompetency Models

Competency Modeling: A process of systematically identifying a set of competencies that are necessary for successful performance in a particular job or job family. – Behavioral indicators are associated with

each competency.– Behavioral Indicators: The observable actions

an employee uses to achieve job-specific results.

Competency ExampleCompetency ExampleCompetency ExampleCompetency Example

SPEAKS EFFECTIVELY - The ability to express and present thoughts and complex ideas clearly, succinctly, and in an understandable manner individually and in groups including adjusting language or terminology to the characteristics and needs of the audience.– Speaks frankly and clearly and insures that others understand the

meaning of what is being communicated– Listens to and responds to the ideas of others– Is direct and to the point in communication delivery– Listens to questions; anticipates impact of decision before providing

a factual answer or recommended options– Balances courtesy with being firm– Demonstrates effective nonverbal communication– Makes the subject as interesting as possible for the audience

Competency Example - 2Competency Example - 2Competency Example - 2Competency Example - 2

ANALYSYS/REASONING: Examines data to grasp issues, draw conclusions, and solve problems.– Identifies key facts in a range of data. Notices when data appear

wrong or incomplete, or need verification. Distinguishes information that is not pertinent to a decision or solution.

– Breaks down complex information into component parts. Sorts and groups data, and applies causal relationships. Sees underlying principles, patterns, or themes in an array of related information.

– Applies logic and complex layers of rules to analyze and categorize complicated information. Sees relationships between information in varied forms and from varied sources.

– Goes beyond analyzing factual information to develop a conceptual understanding of the meaning of a range of information. Integrates diverse themes and lines of reasoning to create new insights or levels of understanding for the issue at hand. Thinks in terms of generalized models rather than concrete details.

Competency Assessment Tool GuideCompetency Assessment Tool GuideCompetency Assessment Tool GuideCompetency Assessment Tool Guide

ForFor

Human ResourceHuman Resource

Business PartnersBusiness Partners

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How to Use the ToolHow to Use the Tool

Be sensitive to raters (peers and/or Be sensitive to raters (peers and/or direct reports) who have multiple direct reports) who have multiple assessments. The number following the assessments. The number following the rater’s name indicates the number of rater’s name indicates the number of open assessments they have to open assessments they have to complete.complete.

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How to Use the ToolHow to Use the ToolHow to Use the ToolHow to Use the Tool

You can Edit Raters, Clear Raters andYou can Edit Raters, Clear Raters andeven Delete an Assessment for a ratee even Delete an Assessment for a ratee

if necessary.if necessary.

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How to Use the ToolHow to Use the ToolHow to Use the ToolHow to Use the Tool

You can check on the progress of your You can check on the progress of your assessments by using any one of these three search criteria: assessments by using any one of these three search criteria:

Employee, Competency Model/Close Date Range, or Supervisor.Employee, Competency Model/Close Date Range, or Supervisor.Click on “Submit” after data entry.Click on “Submit” after data entry.

The status of The status of assessments assessments appears here. appears here.

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How to Use the ToolHow to Use the ToolHow to Use the ToolHow to Use the Tool

You can check for your own results, You can check for your own results, assessments for you to complete, and also assessments for you to complete, and also

initiate an assessment for yourself.initiate an assessment for yourself.

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How to Use the ToolHow to Use the Tool(What “raters” see)(What “raters” see)

How to Use the ToolHow to Use the Tool(What “raters” see)(What “raters” see)

Raters will see the selected Raters will see the selected competency model competency model

with rating choices on a “1-5” scale with rating choices on a “1-5” scale plus a N/A plus a N/A

choice. They enter choices by choice. They enter choices by clicking on the scaleclicking on the scale

radio buttons. There is room for radio buttons. There is room for comments. Raters may save the comments. Raters may save the

assessment as Draft until they are assessment as Draft until they are ready to “Save as Final.” ready to “Save as Final.”

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Working with the ResultsWorking with the ResultsWorking with the ResultsWorking with the Results

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Employee clicks here to get started on the Employee Development PlanEmployee clicks here to get started on the Employee Development Plan

Working with the ResultsWorking with the Results

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The Employee Development PlanThe Employee Development PlanThe Employee Development PlanThe Employee Development Plan

Begin the Employee Begin the Employee Development process hereDevelopment process here

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The Employee Development PlanThe Employee Development PlanThe Employee Development PlanThe Employee Development Plan

Employee Development Plan

You may use this form to keep a record of your developmental activities, including those that were identified as a result of a competency assessment as well as those that are not associated with a particular competency. To find suggested resources or development activities for various competencies, check the Learning Resources section of the Competency Web on EDGE at http://edge.verizon.com/CompetencyWeb.asp.

Learning Resource/

Development Activity Competency/Behavior

(if applicable) Target Date Start/Completion

Date* Courses (instructor-led or online through NetLearn)

Internet/Intranet Sites Readings On the Job Activities Additional Resources * Record the Start Date or Completion Date, as appropriate. For example, for an ongoing activity such as participating in a mentoring program, you may wish to enter the Start Date.

MSWord alternate MSWord alternate version of EDPversion of EDP

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Creating an Employee Development PlanCreating an Employee Development PlanCreating an Employee Development PlanCreating an Employee Development Plan

Summarize what each respondent is saying. Consider what single theme or idea is expressed in the feedback from your supervisor, peers, direct reports and other stakeholders.

Choose a starting point for development.

Keep it simple. For the short term, focus only on one or two areas for development. Don’t be overwhelmed by too many goals.

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Employee Development PlanEmployee Development Plan Employee Development PlanEmployee Development Plan

Once employees have identified “strengths and gaps,” they can consider Once employees have identified “strengths and gaps,” they can consider priority areas for development. They can select from a priority areas for development. They can select from a learning resource database mapped to each competency learning resource database mapped to each competency

within a competency model or even from learning resources within a competency model or even from learning resources not mapped to that particular model. They can select from not mapped to that particular model. They can select from

instructor-led courses, intranet courses, readings and instructor-led courses, intranet courses, readings and suggested on-the-job activities. From these they can buildsuggested on-the-job activities. From these they can build

their development plan. They should review this plan with their their development plan. They should review this plan with their manager to ensure their agreement and support.manager to ensure their agreement and support.

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Employee Development PlanEmployee Development Plan Employee Development PlanEmployee Development Plan

When you select a learning resource area for a competency, When you select a learning resource area for a competency, as in the “Courses” area above, a list will appear. To selectas in the “Courses” area above, a list will appear. To selectan item for your development plan, just place a check markan item for your development plan, just place a check markin the “Add Resource” column. Then click “Save” to add itin the “Add Resource” column. Then click “Save” to add it

to your development plan for that competency.to your development plan for that competency.