Term
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Definition
Continuous process of …
Identifying
Measuring
Developing
… the performance of individuals and teams
Aligning performance with the strategic goals of the organization
Performance management (PM)
is NOT
performance appraisal (PA) |
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Term
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Definition
Strategic business considerations
Driven by line manager
Ongoing feedback
So employee can improve performance |
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Term
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Definition
Driven by HR
Assesses employee
Strengths
Weaknesses
Once a year
Lacks ongoing feedback |
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Term
| Contributions of Performance Management |
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Definition
For Employees
For Managers
For Organization/HR Function |
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Term
| Contributions of Performance Management for Employees |
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Definition
Clarify definitions of
Job
Success criteria
Increase motivation to perform
Increase self-esteem
Enhance self-insight and development |
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Term
| Contributions of Performance Management for Managers |
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Definition
Communicate supervisors’ views of performance more clearly
Managers gain insight about subordinates
Better and more timely differentiation between good and poor performers
Employees become more competent |
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Term
| Contributions of Performance Management for Organization/HR Function |
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Definition
Clarify organizational goals
Facilitate organizational change
Fairer, more appropriate administrative actions
Better protection from lawsuits |
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Term
| Disadvantages/Dangers of Poorly Implemented PM Systems |
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Definition
For Employees
For Managers
For Organization/HR Function |
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Term
| Disadvantages/Dangers of Poorly Implemented PM Systems for Employees |
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Definition
Lowered self-esteem
Employee burnout and job dissatisfaction
Damaged relationships
Use of false or misleading information |
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Term
| Disadvantages/Dangers of Poorly Implemented PM Systems for Managers |
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Definition
Increased turnover
Decreased motivation to perform
Unjustified demands on managers’ resources
Varying and unfair standards and ratings |
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Term
| Disadvantages/Dangers of Poorly Implemented PM Systems for Organization/HR Function |
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Definition
Wasted time and money
Unclear ratings system
Emerging biases
Increased risk of litigation |
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Term
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Definition
Definition
Tangible Returns
Intangible Returns
Returns and their Degrees of Dependency on PM
For Organization/HR Function |
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Term
| Reward Systems Definition |
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Definition
Set of mechanisms for distributing…
Tangible returns
Intangible or relational returns
… as part of an employment relationship |
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Term
| Reward Systems Tangible Returns |
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Definition
Cash compensation
Base pay
Cost-of-Living and Contingent Pay
Incentives (short- and long-term) |
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Term
| Reward Systems Intangible Returns |
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Definition
Relational returns such as
Recognition and status
Employment security
Challenging work
Learning opportunities |
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Term
| Returns and Their Degrees of Dependency on the Performance Management System |
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Definition
Low Dependency
Cost of Living Adjustment
Income Protection
Moderate Dependency
High Dependency
Low Dependency
Moderate Dependency
Work/Life Focus
Allowances
Relational Returns
Base Pay
High Dependency
Low Dependency
Moderate Dependency
High Dependency
Contingent Pay
Short-Term Incentives
Long-Term Incentives |
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Term
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Definition
Strategic
Administrative
Informational
Developmental
Organizational maintenance
Documentation |
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Term
| Purposes of PM SystemsStrategic Purpose |
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Definition
Link individual goals with organization’s goals
Communicate most crucial business strategic initiatives |
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Term
| Purposes of PM SystemsAdministrative Purpose |
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Definition
Provide information for making decisions regarding:
Salary adjustments
Promotions
Retention or termination
Recognition of individual performance
Layoffs |
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Term
| Purposes of PM SystemsInformational Purpose |
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Definition
Communicate to employees:
Expectations
What is important
How they are doing
How to improve |
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Term
| Purposes of PM SystemsDevelopmental Purpose |
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Definition
Performance feedback/coaching
Identification of individual strengths and weaknesses
Identification of causes of performance deficiencies
Tailor development of individual career path |
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Term
| Purposes of PM SystemsOrganizational Maintenance Purpose |
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Definition
Plan effective workforce
Assess future training needs
Evaluate performance at organizational level
Evaluate effectiveness of HR interventions |
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Term
| Purposes of PM Systems Documentation Purpose |
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Definition
Validate selection instruments
Document administrative decisions
Help meet legal requirements |
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Term
| An Ideal PM System: 15 Characteristics |
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Definition
Strategically congruent
Contextually congruent
Thorough
Practical
Meaningful
Specific
Identifies effective and ineffective performance |
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Term
| An Ideal PM System: 15 Characteristics (continued) |
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Definition
Reliable
Valid
Acceptable and fair
Inclusive
Open (No Secrets)
Correctable
Standardized
Ethical |
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Term
| An Ideal PM System: 15 CharacteristicsStrategically Congruent |
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Definition
Consistent with organization’s strategy
Aligned with unit and organizational goals |
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Term
| An Ideal PM System: 15 CharacteristicsContextually Congruent |
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Definition
Congruent with the organization’s culture as well as the broader cultural context of the region or country
Example: A 360-degree feedback is not effective where communication is not fluid and hierarchies are rigid |
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Term
| An Ideal PM System: 15 Characteristics Thorough |
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Definition
All employees are evaluated
All major job responsibilities are evaluated
Evaluations cover performance for entire review period
Feedback is given on both positive and negative performance |
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Term
| An Ideal PM System: 15 Characteristics Practical |
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Definition
Available
Easy to use
Acceptable to decision makers
Benefits outweigh costs |
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Term
| An Ideal PM System: 15 Characteristics Meaningful |
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Definition
Standards are important and relevant
System measures ONLY what employee can control
Results have consequences
Evaluations occur regularly and at appropriate times
System provides for continuing skill development of evaluators |
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Term
| An Ideal PM System: 15 Characteristics Specific |
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Definition
Concrete and detailed guidance to employees
What’s expected
How to meet the expectations |
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Term
| An Ideal PM System: 15 Characteristics Identifies effective and ineffective performance |
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Definition
Distinguish between effective and ineffective:
Behaviors
Results
Provide ability to identify employees with various levels of performance |
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Term
| An Ideal PM System: 15 Characteristics Reliable |
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Definition
Consistent
Free of error
Inter-rater reliability |
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Term
| An Ideal PM System: 15 Characteristics Valid |
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Definition
Relevant (i.e., measures what is important)
Not deficient (i.e., doesn’t measure unimportant facets of job)
Not contaminated (i.e., only measures what the employee can control) |
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Term
| An Ideal PM System: 15 Characteristics Acceptable and Fair |
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Definition
Perception of Distributive Justice
Work performed Evaluation received Reward
Perception of Procedural Justice
Fairness of procedures used to:
Determine ratings
Link ratings to rewards |
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Term
| An Ideal PM System: 15 Characteristics Inclusive |
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Definition
Represents concerns of all involved
When system is created, employees should help with deciding:
What should be measured
How it should be measured
Employee should provide input on performance prior to evaluation meeting. |
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Term
| An Ideal PM System: 15 Characteristics Open (No Secrets) |
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Definition
Frequent, ongoing evaluations and feedback
Two-way communications in appraisal meeting
Clear standards and ongoing communication
Communications are factual, open, and honest |
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Term
| An Ideal PM System: 15 Characteristics Correctable |
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Definition
Recognizes that human judgment is fallible
Appeals process provided |
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Term
| An Ideal PM System: 15 Characteristics Standardized |
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Definition
Ongoing training of managers to provide
Consistent evaluations across:
People
Time |
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Term
| An Ideal PM System: 15 Characteristics Ethical |
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Definition
Supervisor suppresses self-interest
Supervisor rates only where (s)he has sufficient information about the performance dimension
Supervisor respects employee privacy |
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Term
| Integration with other Human Resources and Development Activities |
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Definition
PM provides information for:
Development of training to meet organizational needs
Workforce planning
Recruitment and hiring decisions
Development of compensation systems |
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Term
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Definition
PM used in United States, Mexico, Turkey, India, Australia, China, and so on
Common across countries: Need to align individual and organizational goals to enhance the performance of individuals and groups |
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Term
| PM Around the World (continued) |
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Definition
Yet, different countries emphasize different components of PM
EX 1: PMs in Japan tend to emphasize behaviors to the detriment of results
EX 2: The current challenge among many organizations in South Korea is how to reconcile a merit-based approach with more traditional cultural values |
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