HRM613 Handouts Lectures 1-45

HANDOUTS OF PERFORMANCE MANAGEMENT (HRM 613)

Table of Contents

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

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

Judgmental Procedure ................................................................................................... 54 Mechanical Procedure ................................................................................................... 54 Appraisal Period ............................................................................................................. 56 Formal Appraisal Meetings.............................................................................................. 58 Lesson 24. ..................................................................................................................................... 59 PERFORMANCE INFORMATION SOURCES .................................................................. 59 Sources of Information ................................................................................................... 59 Supervisors.................................................................................................................... 59 Customers ..................................................................................................................... 59 Peers/Colleagues .......................................................................................................... 59 Subordinates .................................................................................................................. 59