Professional Documents
Culture Documents
3
Let's begin our discussion of performance appraisal by defining the concept.
Performance appraisal is a formal system of measuring, evaluating, and influencing
an employees job-related attributes, behaviors and outcomes. The objective is to
to determine how productive an employee is and/or to determine if an employees
productivity can be improved. As such, performance appraisals serve an important
purpose in managing people and meeting company goals.
Ref: http://www.oocities.org/wilfratzburg/performanceappraisal.html
(PERFORMANCE
APPRAISAL
Objectives:
i.)
Discrimination
Managers must be able to sel;ectbetrween those who are
contributing tio the organizations objectives and those who are not.
The organization must prove that decision was made on merit alone
(provide firm detail on performance record) and not on any other
issue.
ii.)
Reward
To encourage performance and must be given to the employees
who contribute more to successfully achieving the strategic
objectives of the organization.
Determining Compensation Changes. This is another classic use of
performance appraisal. Almost every organization believes in pay for
performance. But how can pay decisions be made if there is no measure
of performance? Performance appraisal provides the mechanism to make
sure that those who do better work receive more pay.
basic system succeeded in getting the results that were intended; but more often than not, it failed.
For example, early motivational researchers were aware that different people with roughly equal
work abilities could be paid the same amount of money and yet have quite different levels of
motivation and performance. Pay rates were important, yes; but they were not the only element that
had an impact on employee performance. It was found that other issues, such as morale and selfesteem, could also have a major influence. As a result, the traditional emphasis on reward outcomes
was progressively rejected. In the 1950s in the United States, the potential usefulness of appraisal as
tool for motivation and development was gradually recognized.
Performance appraisal may be a structured formal interaction between a subordinate and supervisor,
that usually takes the form of a periodic interview (annual or semi-annual, etc), in which the work
performance of the subordinate is examined and discussed, with a view to identifying weaknesses
and strengths as well as opportunities for improvement and skills development. In many
organizations - but not all - appraisal results are used, either directly or indirectly, to help determine
reward outcomes. That is, the appraisal results are used to identify the better performing employees
who should get the majority of available merit pay increases, bonuses, and promotions. By the same
token, appraisal results are used to identify the poorer performers who may require some form of
counselling, or in extreme cases, demotion, dismissal or decreases in pay. Whether this is an
appropriate use of performance appraisal - the assignment and justification of rewards and penalties is a very uncertain and contentious matter.
Ref: http://ir.knust.edu.gh/bitstream/123456789/614/1/Sterlington%20Kofi%20Horsoo.pdf
Author: Sterlington Kofi Horsoo
Title: EMPLOYEE PERFORMANCE APPRAISAL, REWARDS & RECOGNITIONS A
CASE STUDY OF BARCLAYS BANK OF GHANA LIMITED (Thesis)
Date: 2009
Retrieved: 11/5/2015
iii.)
Development
Builds strengths and weaknesses as managers should remove
barriers that could affect the performance of the employees so that
they can grow and develop.
Encouraging Coaching and Mentoring. Managers are expected to be good coaches to their
team members and mentors to their proteges. Performance appraisal identies the areas where
coaching is necessary and encourages managers to take an active coaching role.
Supporting Manpower Planning. Well-managed organizations regularly assess their bench
strength to make sure that they have the talent in their ranks that they will need for the future.
Companies need to determine who and where their most talented members are. They need to
identify the departments that are rich with talent and the ones that are suffering a talent drought.
Performance appraisal gives companies the tool they need to make sure they have the intellectual
horsepower required for the future.
Determining Individual Training and Development Needs. If the performance appraisal
procedure includes a requirement that individual development plans be determined and
discussed, individuals can then make good decisions about the skills and competencies they need
to acquire to make a greater contribution to the company. As a result, they increase their chances
of promotion and lower their odds of layoff.
Determining Organizational Training and Development Needs. Would the organization be
better off sending all of its managers and professionals through a customer service training
program or one on effective decision making? By reviewing the data from performance
appraisals, training and development professionals can make good decisions about where the
organization should concentrate company-wide training efforts.
Training Needed
These appraisals also identify the necessary training and development the
employee needs to close the gap between current performance and desired
performance.
iv.)
Feedback
Managers must evaluate performance of their employees and
communicate assessment. They must identify their deficiencies and
determine how they could be overcome, know which training is
needed and create opportunities.
Providing Feedback. Providing feedback is the most common
justification for an organization to have a performance appraisal system.
Through its performance appraisal process the individual learns exactly
how well he/she did during the previous twelve months and can then use
that information to improve his/her performance in the future. In this
regard, performance appraisal serves another important purpose by
making sure that the bosss expectations are clearly communicated.
Improving Overall Organizational Performance. This is the most
important reason for an organization to have a performance appraisal
system. A performance appraisal procedure allows the organization to
communicate performance expectations to every member of the team
and assess exactly how well each person is doing. When everyone is clear
on the expectations and knows exactly how he is performing against
them, this will result in an overall improvement in organizational success.
From the employee's perspective, performance appraisal informs them about what
is required of them in order to do their jobs, it tells them how well they have
achieved those objectives and helps them take corrective action to improve their
performance, and, finally, it may reward them for meeting the required standards.
The firm, on the other hand, needs a performance appraisal system in order to
establish principles of managerial accountability. Clearly, where employees are
given responsibilities and duties, they need to be held accountable. One of the
functions of performance appraisals is to ensure that people are accountable for
their organizational responsibilities.
Perhaps the most significant benefit of performance appraisals is the
opportunities they provide supervisors and subordinates to have one-on-one
discussions of important work issues. During appraisals, subordinates and
supervisors can focus on work activities and goals, identify and correct existing
problems, and encourage better future performance.
essential to human resource planning. Finally, the appraisee and their line manager agree the
future agenda, specifically for the next appraisal period. This will include key objectives for their
post along with addressing training needs in terms of the needs of the specific post, the
individual's professional development needs and any other training needs, if relevant.
From the organisational perspective, appraisal deals with people as aspects of organisations.
When an employer takes on employees, part of the process involves people being socialised into
organisational norms. Within any organisation, there tends to be a dominant coalition, which
dictates the values of the organisation. Such cultural factors have an important bearing on the
values which are held within an organisation. These in turn dictate the values which are at the
foundation of employee appraisal along with underpinning the competencies against which
employee performance is measured.
Fletcher (2008) points out that employees will see themselves as benefitting if these
organisational objectives are met (i.e. they want to be properly rewarded, discuss opportunities
for development etc.). If appraisal does nothing else, it causes manager and subordinates to get
together and discuss the subordinate's performance. However, this situation has the potential to
be quite socially uncomfortable and it only works if the jobholder wants to be appraised. Fletcher
(2008) identifies three factors that are particularly important in determining whether the
employee engages in the process to help meet the objectives of appraisal. They are:
The quality of the employee's existing relationship with the person / persons doing the
appraising
The impact that the appraisal has on employee reward and their own well-being
Clearly, this presents a rich agenda for occupational psychologists. Undoubtedly, appraisal has a
'technical element' in terms of how performance is measured. However, it is also a very social
process.
Theoretically, appraisal is intended to be about the development of the appraisee, both in terms
of their professional development and in terms of their role within the organisation. To achieve
this, it is essential that the appraisal is about behaviour rather than about personality or similar
personal attributes (Kluger & DeNisi, 1996).
This is because a person can change their behaviour, that is, it is within the control of the person.
Personality is a different matter and even if one were to argue that it can be changed, there are
related ethical issues. Personality appears to be stable during adult life. The two essential issues
are that appraisal is about behaviour, rather than personality and appraisal should be about things
which the individual can control. That said, tools such as the Myers-Briggs Type Indicator can be
used to help employees understand how their personality helps or hinders them in a variety of
different situations at work (and thereby raises self-awareness).
When referring to change in behaviour in the workplace, we are talking about the appraiser and
appraisee agreeing a commitment to change. This is not about appraisee compliance, and it may
well involve the appraiser or others changing their behaviour in order to facilitate behavioural
change in the appraisee.
As with other aspects of occupational psychology, for example, personnel selection, there are
issues of power inequality at play in the appraisal process. While theoretically the appraisal
interview may be intended to be a discussion between appraiser and appraisee, the very setting
implies a situation of unequal power between the two parties, and as the appraiser is most often
the appraisee's line manager, this inequality is exacerbated. This issue increases the importance
of keeping the focus on job performance. It is neither just a process of filling in forms, nor a
judgement on the appraisee as a person.
Once the performance appraisal form has been written, reviewed, and
approved, the employee and the manager get together for the final phase of
the process: performance review. They discuss the managers evaluation of
the individuals performance and come to an understanding of what was
accomplished over the course of the year and how those accomplishments
were evaluated. At the end of this meeting, they set a time to get together
again to plan for the upcoming year, and the process begins anew.
Ref:http://vulms.vu.edu.pk/Courses/HRM713/Downloads/The
%20Performance%20Appraisal%20Question%20and%20Answer
%20Book.pdf
Q.4
define motivation
(own words & 2 examples)
Leadership Style
This determines how a leader runs an organization in meeting the
gloas and objectives of an organization, controls its workforce and
intereact with the outside environment.
A leader to flexible and respect the knowledge, skills and abilities of its
workers to do its job. Other styles could be telling, selling, persuading
and participating. Sometimes the m,anager is required to use a
different style for different people.
When you give your power away, you are allowing your employees to
share your responsibility and authority (Bruce, c2003, p.66) and is
mainly a resource, a means to an end so as to get better results and
the jobs are done effectively and efficiently.
Reward System
Organizational Climate
Structure of work
Employees need to have control and be able to redesign and reshape
their jobs. The amount of work needs to be made exciting and
challenging. Team spirit and bonding encouraged, that involves
interacting with other employees so that with their cooperation a job
could be done quickly and bring out the best energies of the individual.
It should excite workers to seek new opportunities so that they can
look forward to come to work every day.
Q.5
Considerations
Many organizations conduct annual performance appraisals. These appraisals when properly
administered are based on performance standards. Standards are what an employer wants an
employee to accomplish to meet the company's expectations. For example, if an employer
requires its sales representatives to close 15 sales each month, employees who close fewer than
15 sales are rated as falling below expectations. Employees who close more than 15 sales each
month would be rated as exceeding expectations. For a P4P system to be effective so employers
and employees reap the benefits of tying performance to compensation, employers must clearly
communicate their expectations and conduct performance appraisals according to performance
standards.
Guidelines
Employers must give workers and managers guidelines on how the P4P system is connected to
performance ratings. The advantage of setting guidelines for P4P systems is to address questions
about the type of wage increase, bonus or other incentive an employee receives for meeting or
exceeding expectations. Employers who don't communicate the company's standards and
guidelines are creating a P4P system that's likely to fail.
Consistency
With a P4P system, employees receive wage increases, bonuses and even special perks for
achieving performance goals. For an employee to receive the base wage increase, she must meet
her employer's performance expectations. If she exceeds expectations, it improves her chances of
receiving additional monetary incentives. Consistency in performance appraisals is key in P4P
systems. Supervisors and managers must conduct their subordinates' performance appraisal in
the exact manner approved by the human resources department or executive leadership team.
Too much subjectivity is one of the disadvantages of a P4P system because it results in
inconsistent evaluation of job performance and, ultimately, an ineffective P4P system and
dissatisfied employees.
Incentive
Employers and employees alike benefit from a P4P that provides incentives for job performance.
Employees in such a system strive for higher ratings by working harder and hopefully smarter.
While incentives push employees to achieve higher performance ratings, consistent application
of performance standards and P4P guidelines encourage employees to maintain those high
ratings. Employees who show strong performance, but drop off after they've received their raise
or bonus, introduce one of the disadvantages of P4P systems inconsistent performance.
Performance
For employers and employees to reap the benefits of a P4P system, there need to be guidelines
and incentives for employees who maintain high performance ratings. For example, awarding
employees with a wage increase that compounds their salary is the truest form of incentive,
rather than a one-time bonus that doesn't increase employee long-term earnings. Employers
avoid P4P disadvantages from performance drop-offs when they use a system that rewards
achievement and the employee's ability to maintain good job performance long after a
performance appraisal.
Advantages and Limitations of Performance-Linked Pay
The issue of merit pay has remained a subject of considerable debate in both the private and public sectors. A
business organization must evaluate the pros and cons of merit pay carefully while devising its pay policies for the
employees. Conventional wisdom in business has usually favored the existence of merit or performance linked pay.
However, the downside of this pay system often gets ignored. Each organization is unique and it must evolve the
best pay method that matches its needs in the best possible manner.
Definition:
Merit pay is an approach to compensation that rewards the higher performing employees with
additional pay or incentive pay. Merit pay has advantages and disadvantages for the employees
and the employer. But, all-in-all, merit pay is the best way to reward the employees that you most
want to keep. Here's more about why you might want to consider merit pay.
Advantages of Merit Pay
These are reasons why you might want to consider merit pay.
Merit pay, unlike profit sharing or similar bonus pay schemes, allows an
employer to differentiate between the performance of the company as a
whole and the performance of an individual. While many merit pay programs
also provide an overall reward that is distributed to all employees, to promote
such values as team work, a portion of the available compensation is
reserved for strong performers.
Even with the limitations that exist in the awarding of merit pay, merit pay is your best
opportunity to ensure that your outstanding performers remain with your company and continue
to make their astonishing contributions. Nothing demotivates a high performer faster than
knowing that employees who have contributed much less in the organization, have received the
same pay increase or bonus.
Ref: http://humanresources.about.com/od/salaryandbenefits/g/merit-pay.htm
Q.1
Business strategy can change and must change in response to changes in the business and
economic environment.
The strategies adopted during times of plenty differ from those during recessions. Recruitment
strategy must change accordingly.
The use of strategy in recruitment is intended to attain the objective "Matching People with
Jobs." With the absence of this approach, your organization may have to change its plan and may
end up "Matching Jobs to People." This goes against the direction of your business plan.
What is Strategic Recruitment?
It means identifying the real recruitment needs of your organization and fulfilling those needs.
The organizational needs are tied to the overall strategic business plan.
The needs are in terms of number, quality, and specialized skills and talents in every area of the
organization's activities.
The organization's people needs range from the immediate to medium and long terms needs.
These are considerations to make in recruitment.
Measurement of Recruitment Effectiveness
The quality of people that you can recruit will determine the future of your organization. You
need to have the right mix of experience, skills and talents in order to grow stronger in every
way.
The strategic recruitment approach requires your organization to measure the effectiveness of
your recruitment policy and activities. This is important because a lot of money is involved in
recruitment.
Recruitment metrics include:
Cost per hire which includes all the costs involved from the time the
recruitment process commences until the selected candidate reports for duty.
Speed of Hire also referred to as Time to Hire referring to the time the
position fell vacant to the time a replacement is found.
Customer Satisfaction. This refers to the satisfaction of the requester for the
new employee and customers of the section where the new recruit is
stationed.
Quality of Hire. Some consider this as the most important measure. This
means that the requesting department or unit now have the right people in
order to be more productive.
Gaps between what skills you have available and the skills needs to
accomplish organizational goals
Also take into consideration the number of employees promoted or deployed to different
divisions or departments.
What is the immediate and future expansion plan of your organization? Are you going to cease
certain activities?
Use this information to strategize your recruitment plan.
Recruitment During Hard Times
The importance of strategic recruitment becomes pronounced during economic downturns and
during times when the organization is not performing well financially.
Cutting costs become a prime concern of organizations. Reducing headcounts is one of the
common cost-cutting methods.* (see below)The effect becomes apparent very fast.
However, a survey by Deloitte Group shows that managing human capital is still a very
important issue in industries.
A lot of organizations prefer restructuring jobs more to reducing headcount. Many choose to
adopt people management strategies such as reducing bonus, benefit and salary, hiring more parttime employees and encouraging early retirement.
Surely it is logical to conclude that employees who are retained are those in critical areas of
operations.
Whether during times of plenty or when hard times come, it is a good strategy to always adopt a
strategic recruitment plan.
The future of strategic recruitment
This is proactive action to ensure that nothing is left to chance. Strategic recruitment is a
response to dynamic market conditions, whether local or global or both.
Ref: http://www.strategic-human-resource.com/strategicrecruitment.html
Definition of
Position Requirements
Delineation of Desired
Candidate Attributes
Recruitment of
Potential Applicants
Assessment and
Evaluation of Candidates
Selection of
Desired Candidate
Communication skills
Social awareness skills
Social judgment skills
Persuasion and negotiation skills
Collaboration skills
Team-building skills
Relationship-building skills
Behavioral complexity
Multicultural awareness and
Sensitivity
Strategic Attributes
Cognitive Attributes
Intelligence
Basic problem-solving skills
Critical thinking
Creative thinking
Ability to learn
Absorptive capacity
Business Attributes
Business acumen
Finance management skills
Organization management skills
Global networking skills