Slide 12.1

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Chapter 12

Employee Performance Management

• Stages in a performance management system (pp.270-274)

• The nature of 360-degree feedback

(pp.279- mid 281)

Slide 12.2

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Performance Management Systems

• Increasingly seen as a way to manage employee performance

• Incorporates appraisal/review process

• Establishing a framework in which performance by human resources can be directed, monitored, motivated and refined, and that the links in the cycle can be audited (Clark 2005)

Slide 12.3

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Advantages of Performance Management Systems

• Being tied closely to the objectives of the organisation

• Represent a more holistic view of performance• Appraisal or review is integrated with performance

planning• Performance is assessed and successful

performance rewarded and reinforced(Bevan and Thompson 1992)

Slide 12.4

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Stages of a Typical PMS

Figure 12.2 Stages of a typical performance management system

Slide 12.5

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

An Objective Setting Cascade

Figure 12.3 An objective-setting cascade

Slide 12.6

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

A Shared View of Expected Performance

• Individual objectives derived from team objectives• An agreed job description jointly devised• Objectives are outcome or results oriented• Objectives are tightly defined and include measures

to be assessed• Objectives designed to stretch individuals and offer

potential for development

Slide 12.7

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

SMART Objectives

• Specific• Measurable• Appropriate• Relevant• Timed

Slide 12.8

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Role of Objectives

• Allow the development of a shared understanding of what is expected, allowing for the employee’s contribution

• Allow employees to decide on an appropriate approach by using a ‘what’ rather than a ‘how’ statement

• Generate greater degree of ownership and thus commitment to achieving the objective

Slide 12.9

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Problems with Objectives

• May be inappropriate ways of achieving a ‘what’ objective

• Appropriate levels of resource and support may not be available

• Employees may not always be able to control their outputs, so it is important to have some ‘how’ objectives

Slide 12.10

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Delivering and Monitoring Performance

The manager’s role• Enabling role while staff are working to achieve the

performance agreed• Organising resources• Organising off-job training• Being accessible• Providing ongoing coaching• Providing support and guidance

Slide 12.11

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Reviews

Normally informal

Need not be part of any formal system

Can take place as needed

Provide a forum for employee reward in terms of recognition of progress

Slide 12.12

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Formal Performance Review and Assessment

Need to concentrate on development issues to motivate

Assess the extent to which objectives have been met – may affect pay

Employee may be invited to draft initial assessment of performance

May lead to a rating of performance although this is often unpopular with employees

Slide 12.13

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Reward

• Some systems still include link to money– May be unpopular and the amount may be too small

to motivate

• Promotion and development often used as a reward

Slide 12.14

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

360-Degree Feedback

Whole range of feedback sought from a range of people and sources, e.g.:

Peers

Subordinates More senior managers

Internal customers External customers

Individuals themselves

Slide 12.15

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Reasons for 360-Degree Feedback

• Greater breadth than relying just on the line manager• Captures the complexities of performance• Argued to be more compelling and valid to those

receiving the feedback• Powerful information for the development of self-

awareness

Slide 12.16

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Formal Process of 360-Degree Feedback

• It is based on feedback Survey approach using questionnaire, contributor score on a given scale.

• May be off the self or organisation specific but should focus on behavioural competencies

• Contributors mark a score on a scale the extent to which an employee displays these behaviours

• Individual chooses contributors and gets aggregated anonymous feedback

• Feedback should be used to plan behaviour change and improve performance

Slide 12.17

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Benefits of 360-Degree Feedback

• Stronger ownership of development goals• Climate of constructive feedback• Improved communication• An organisation that is more open to change

Slide 12.18

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Difficulties and Dilemmas

• Tension between using to drive development and to drive pay

• Rater confidentiality can be difficult to maintain• Evaluation may be biased and there is a danger of

collusion• Demotivating without the resource to support

identified development needs• May not motivate individuals to act• May lead to negative outcomes, e.g. reduced effort• Requires appropriate organisational climate

Slide 12.19

Derek Torrington, Laura Hall, Stephen Taylor and Carol Atkinson, Human Resource Management, 8e © Pearson Education Limited 2012

Summary (1 of 2)• Performance management systems include more

than appraisals, and are linked to the strategic objectives of organisations

• There is conflict in many appraisal and performance management systems

• Measurement and rating systems can be problematical

• Objective setting is a fundamental part of performance management

• Current trends include greater employee ownership and involvement

• 360-degree feedback is becoming more widely use