HRM613 Handouts by VUBuddy

HANDOUTS OF PERFORMANCE MANAGEMENT (HRM 613)

Table of Contents

Lesson 1.........................................................................................................................................................................1

Significance of the course ...........................................................................................................................2 Lesson 2.........................................................................................................................................................................3 INTRODUCTION TO PERFORMANCE MANAGEMENT ...................................................................3 Definition of PM .........................................................................................................................................3 Background of PMS: ...................................................................................................................................3 Underlying theories .....................................................................................................................................4

Lesson 3.........................................................................................................................................................................6 IMPACT OF PERFORMANCE MANAGEMENT SYSTEM (PMS)......................................................6 Impact on Employees: ...................................................................................................................................6 Impact on Managers/Supervisors: ...............................................................................................................6 Impact on Organization: ................................................................................................................................6 Lesson 4.........................................................................................................................................................................8 REWARD SYSTEMS............................................................................................................................................8 Internal factors: ...............................................................................................................................................8 External factors: ..............................................................................................................................................8 Types of rewards .............................................................................................................................................9 Lesson 5.............................................................................................................................................................................10 IDEAL PMS ..........................................................................................................................................................10 Characteristics of an Ideal PMS: ..................................................................................................................10 Congruent with strategy: ...........................................................................................................................10 Thorough: ....................................................................................................................................................10 Practical: ..................................................................................................................................................11 Meaningful: ..............................................................................................................................................11 Specific: .......................................................................................................................................................11 Identify effective and ineffective performance: ..................................................................................11 Reliable: ......................................................................................................................................................11 Valid: .........................................................................................................................................................11 Fair and Acceptable: ...............................................................................................................................12 Inclusive: ......................................................................................................................................................12 Open: ........................................................................................................................................................12 Correctable: .................................................................................................................................................12 Standardized: ...............................................................................................................................................12 Ethical: .....................................................................................................................................................12 Constraints of PMS .......................................................................................................................................12 Organization based constraints: ..............................................................................................................12 Manager based constraints: ......................................................................................................................13 Employee based constraints: .................................................................................................................13 Lesson 6........................................................................................................................................................................14 INTEGRATION OF PMS WITH HRM ........................................................................................................14 Training and development: .......................................................................................................................14 Compensation Management: .....................................................................................................................14 Human Resource Planning: .......................................................................................................................14 Lesson 7......................................................................................................................................................................15 PM PROCESS: PREREQUISITES AND PERFORMANCE PLANNING........................................15

Outcomes: ...................................................................................................................................................15 Behaviors: ...................................................................................................................................................15 Development Plans: ................................................................................................................................16 Lesson 8......................................................................................................................................................................19 PM PROCESS: PERFORMANCE EXECUTION AND ASSESSMENT ...........................................19

Employees’ role: ..........................................................................................................................................19 Managers’ role: .............................................................................................................................................20

Lesson 9......................................................................................................................................................................21 PM PROCESS; PERFORMANCE REVIEW, RENEWAL AND RE-CONTRACTING .................21

Productive Performance Review: ..............................................................................................................21

Lesson 10....................................................................................................................................................................23 STRATEGIC PLANNING ...........................................................................................................................23 Performance management – Strategic plan link: ....................................................................................24 Organization’s Strategic Plan: ....................................................................................................................25 Unit’s Strategic Plan: ...................................................................................................................................25 Job description: .........................................................................................................................................25 Individual and Team performance: ........................................................................................................25 Lesson 11....................................................................................................................................................................26 STRATEGIC PLANNING; ENVIRONMENTAL ANALYSIS ............................................................26 Steps to develop strategic plan ..................................................................................................................26 Environmental Analysis .............................................................................................................................26 Gap Analysis ................................................................................................................................................27 Lesson 12.......................................................................................................................................................................29 STRATEGIC PLANNING; REVISING MISSION, VISION, GOALS ..............................................29 Importance of PMS: ..................................................................................................................................29 Strategic Planning; Mission: ......................................................................................................................29 Strategic Planning; Vision: ........................................................................................................................29 Strategic Planning; Goals: .........................................................................................................................30 Lesson 13...................................................................................................................................................................31 PERFORMANCE STANDARDS ..............................................................................................................31 Developing Performance Standards ........................................................................................................31 Pitfalls in developing performance standards ......................................................................................31 Lesson 14...................................................................................................................................................................32 DETERMINANTS OF PERFORMANCE ...............................................................................................32 Performance Determinants: ......................................................................................................................32 Declarative knowledge: ..............................................................................................................................32 Procedural knowledge: ...............................................................................................................................32 Motivation: ...................................................................................................................................................32 Factors influencing determinants of performance: ..............................................................................33 Lesson 15........................................................................................................................................................................34 PERFORMANCE DIMENSIONS AND MEASUREMENT.................................................................34 Task Performance: ......................................................................................................................................34 Contextual Performance: ......................................................................................................................34 Approaches to Measure Performance: ...............................................................................................34 Trait Approach: ..............................................................................................................................35 Behavior Approach: ......................................................................................................................35 Link between behaviors and results: ............................................................................................35 Lesson 16................................................................................................................................................................36 POOR PERFORMANCE...........................................................................................................................36 Performance Problem and Poor Work Habits: .................................................................................36 Work Behaviors Which Result in Performance Problems ..............................................................37 Evaluating Poor Performance: ...........................................................................................................37 Managing Poor Performance: .............................................................................................................39 Lesson 17....................................................................................................................................................................41 Measuring Performance ........................................................................................................................41 Determining Accountabilities ..............................................................................................................41 Determining Objectives.........................................................................................................................41 Lesson 18................................................................................................................................................................43 MEASURING PERFORMANCE; CONTINUED… ..........................................................................43 Quality: .....................................................................................................................................................43 Quantity ...................................................................................................................................................43 Useful Benchmarks ................................................................................................................................43 Lesson 19................................................................................................................................................................44 MEASURING BEHAVIORS ....................................................................................................................44 Threshold Competencies ......................................................................................................................44 Differentiating Competencies ..............................................................................................................44 Lesson 20................................................................................................................................................................45 MEASURING COMPETENCIES ...........................................................................................................45 Comparative Systems .............................................................................................................................45 Simple Rank Order: ................................................................................................................................45 Alternation Rank Order: ........................................................................................................................45 Paired Comparison: ................................................................................................................................45 Forced Distribution: ...............................................................................................................................46 Advantages of Comparative Systems....................................................................................................46 Disadvantages of Comparative Systems ..............................................................................................46 Lesson 21.................................................................................................................................................................47 MEASURING COMPETENCIES; CONTINUED… ..........................................................................47 Absolute Systems: ...................................................................................................................................47 Essays ........................................................................................................................................................47 Behavior Checklist ..................................................................................................................................47 Critical Incidents .....................................................................................................................................48 Graphic Rating Scale...............................................................................................................................49 Behaviorally Anchored Rating Scales (BARS) ...................................................................................49 Lesson 22................................................................................................................................................................50

Components of Appraisal Forms.........................................................................................................50 Effectiveness of Appraisal Forms ........................................................................................................51 Electronically filled Appraisal Forms: .................................................................................................52 Lesson 23................................................................................................................................................................54 EVALUATION OF APPRAISAL FORMS ............................................................................................54 Strategies for determining overall performance ................................................................................54