Final Exam CH 10-13 Flashcards
What is Performance Management?
the process encompassing all activities related to improving employee performance, productivity, and effectiveness
Performance Management Process?
- Defining Performance Expectations and Goals – make sure that job duties and job standards are clear
- Providing Ongoing Feedback and Coaching – achieved through open two-way communication
- Conducting Performance Appraisal and Evaluation Discussions
- Determining Performance Rewards/Consequences – ex. Promotions, salary increases, and bonuses
- Conducting Development and Career Opportunities Discussions
What are the Formal Appraisal Methods?
- Graphic Rating Scale
- Alternation Ranking Method
- Paired Comparison Method
- Forced Distribution Method
- Critical Incident Method
- Narrative Forms
- Behaviourally Anchored Rating Scales (BARS)
- Management by Objectives (MBO)
- Computerized and Web-Based Performance Appraisal
what is Graphic Rating Scale?
a scale that lists a number of traits and a range of performance for each
- the employee is then rated by identifying the score that best describes his or her level of performance for each trait (see page 269)
what is Alternation Ranking Method?
ranking employees from best to worst on a particular trait (pg. 271)
what is Paired Comparison Method ?
ranking employees by making a chart of all possible pairs of employees for each trait and indicating the better employee of the pair
what is Forced Distribution Method?
– predetermined percentages of rates are placed in various performance categories
Ex. It may be decided to distribute employees as follows: 15% high performers, 20% high-average,
30% average, 20% low-average, and 15% low performers
what is Critical Incident Method ?
– keeping a record of uncommonly good or undesirable examples of an employee’s work-related behaviour and reviewing the list with the employee at predetermined times
what is Behaviourally Anchored Rating Scales (BARS)
– an appraisal method that aims to combine the benefits of narratives, critical incidents, and quantified ratings by anchoring a quantified scale with specific narrative examples of good and poor performance
what is Management by Objectives (MBO) ?
– involves setting specific measurable goals with each employee then periodically reviewing the progress made
what are the Five Components of Total Rewards?
- Compensation - includes direct financial payments (wages, salaries, incentives etc.)
- Benefits - includes indirect payments in form of financial benefits (insurance/vacation)
- Work/Life Programs - programs that help employees do their jobs effectively (ex. flexible scheduling)
- Performance and Recognition – includes pay-for-performance and recognition programs
- Development and Career Opportunities – focuses on planning for the advancement and/or change in responsibilities to best suit individual skills, talents, and desires (tuition assistance, coaching/mentoring)
what are the Basic Considerations in Determining Pay Rates?
- Legal Requirements
- Employment/Labour Standards Act
- Pay Equity Acts
- Human Rights Acts
- Canada/Quebec Pension Plan
- Union Issues
- Compensation Policy
- Equity
steps in establishing Pay rates?
- Determine the worth of jobs within the organization through job evaluation (to ensure internal equity), and group jobs with similar worth into pay grades
- Conduct a wage/salary survey of what other employers are paying for comparable jobs (to ensure external equity)
- Combine the job evaluation (internal) and salary survey (external) information to determine pay rates for the jobs in the organization
Parts of Job Evaluation?
Compensable Factors – a fundamental, compensable element of a job, such as skill, effort, responsibility, and working conditions
Benchmark Job – a job that is critical to the firm’s operations or commonly found in other organizations
- Classification/Grading
- Points Method
what is the Grading Method of Categorizing jobs into groups?
Classes – groups of jobs based on a set of rules for each class, such as amount of independent
judgement, skill, physical effort, and so forth
- classes usually contain similar jobs – such as all secretaries
Grades – groups of jobs based on a set of rules for each grade, where jobs are similar in difficulty but
otherwise different
-grades often contain dissimilar jobs, such as secretaries, mechanics, and fire fighters
Grade/Group Description – a written description of the level of compensable factors required by jobs
in each grade
- used to combine similar jobs into grades or classes
What is the point method of categorizing jobs into groups?
The job evaluation method in which a number of compensable factors are identified, the degree to which each of these factors is present in the job is determined, and an overall point value is calculated
What are the steps in the point method?
- Preliminary Steps
- necessary to have current job descriptions and job specifications based on a thorough job analysis
- foundation of the job evaluation plan is a number of compensable factors which must be agreed upon
- each sub factor must be carefully defined to ensure that the evaluation committee members will apply them consistently - Determine Factor Weights and Degrees
- Assign Points for Each Degree of Each Sub-Factor
- Evaluate the Jobs
ways to conduct a salary survey?
- informal communication with other employers
- reviewing newspaper and Internet job ads
- surveying employment agencies
- buying commercial or professional surveys
- reviewing online compensation surveys
- conducting formal questionnaire-type surveys with other employers
what is pay for knowledge?
Pay-for-Knowledge systems are known as competency-based pay (for management and professional employees) and skill-based pay (for manufacturing employees). These plans pay employees for the range, depth, and types of knowledge that they are capable of using, rather than for the job that they currently hold. Competencies are individual knowledge, skills and behaviours that are critical to successful individual or corporate performance based on their relation to the organization’s visions, values, and business strategy.
five elements in an executive/managerial compensation package?
- salary
- benefits
- short-term incentives
- long-term incentives
- perquisites
Steps in Developing a BARS?
- Generate Critical Incidents – people who know the job being appraised are asked to describe specific illustrations (critical incidents) or effective and ineffective performance
- Develop Performance Dimensions – these people then cluster the incidents into a smaller set of performance dimensions
- Reallocate Incidents – another group of people reallocate the original critical incidents
- Scale the Incidents – this group is asked to rate the behaviour described in the incident as to how effectively or ineffectively it represents performance on the appropriate dimension
- Develop the Final Instrument – a subset of the incidents is used as behaviour anchors for each dimension
what are the Advantages and Disadvantages of BARS?
- A more accurate measure
- Clearer standards
- Feedback
- Independent dimensions
- Consistency
What some Rating Scale Problems?
- Unclear Performance Standards - too open to interpretation of traits and standards
- Halo Effect - supervisor’s rating biases the rating of them on other traits
- Central Tendency- tendency to rate all employees in middle of the scale
- Leniency/Strictness - supervisor has a tendency to rate all employees high or low
- Appraisal Bias- tendency to allow individual differences (age, race, sex) to affect ratings
- The Recency Effect- rating error that occurs when ratings are based on the employee’s most recent performance
- Similar-to-Me Bias
what is a 360-Degree Appraisal ?
a performance appraisal technique that uses multiple raters including peers, employees reporting to the appraise, supervisors, and customers
