CH-8 Performance Management – Human Resource Management : Book Guide

Chapter 08 - Performance Management Please click here to access the new HRM Failures case associated with this chapter. HRM Failures features real-life situations in which an HR conflict ended up in court. Each case includes a discussion questions and possible answers for easy use in the classroom. HRM Failures are not included in the text so that you can provide your students with additional real-life content that helps engrain chapter concepts. Chapter Summary This chapter examines a variety of approaches to performance management. The chapter begins with a model of the performance-management process that examines the system's purposes. Then, the specific approaches to performance management are discussed, including the strengths and weaknesses of each approach. The various sources of performance information are also presented. Next, the errors resulting from subjective assessments of performance are identified, as well as the means for reducing those errors. Then, the effective components to performance feedback are discussed. Finally, the causes of performance problems are identified. Learning Objectives After studying this chapter, the student should be able to: 1. Identify the major determinants of individual performance. 2. Discuss the three general purposes of performance management. 3. Identify the five criteria for effective performance management systems. 4. Discuss the four approaches to performance management, the specific techniques used in each approach, and the way these approaches compare with the criteria for effective performance management systems. 5. Choose the most effective approach to performance measurement for a given situation. 6. Discuss the advantages and disadvantages of the different sources of performance information. 7. Choose the most effective source(s) for performance information for any situation. 8. Distinguish types of rating errors and explain how to minimize each in a performance evaluation. 9. Conduct an effective performance feedback session. 10. Identify the cause of a performance problem. Extended Chapter Outline Note: Key terms appear in boldface and are listed in the "Chapter Vocabulary" section. Opening Vignette: Performance Management Helps Turn-around a Health Care Organization VivaKi Nerve Center in Chicago is the research, development, and production unit of advertising and communications firm Publicis Groupe’s VivaKi. The nerve center has a set of core values called “The Way We Work” that guide employees in being successful. Research shows that the most profitable firms have a CEO who puts forth challenging financial goals and communicate a vision that goes beyond those financial goals (for example, to be innovative, provide great customer service, etc.). Another example of a firm that uses values to guide performance management is Eastern Idaho Regional Medical Center (EIRMC). EIRMC evaluates their employees on seven values and their underlying behaviors. The challenge appears to be in managing behaviors that underlie values more so than managing performance itself. It boils down to managing how things get done, not what gets done. Discussion Question 1. How does this vignette illustrate the strategic importance of performance management? Answer: Clearly, organizations that recognize that performance is much more than bottom line numbers have a leg up on their competition when it comes to managing overall performance of the firm. Performance management at these organizations is linked to the organizational goals and objectives because their focus is aimed more at underlying behaviors and values (which drive performance) more so than just financial performance. Having a value system makes it easier for managers to set goals and to track goals that are in line with organizational expectations. This alignment contributes to the success of these organizations, just like it does for VivaKi Nerve Center and EIRMC, which illustrates the strategic importance of performance management. I. Introduction A. Performance management is the process through which managers ensure that employees’ activities and outputs are congruent with the organization's goals. Performance management is central to gaining competitive advantage. The performance management system has three parts: defining performance, measuring performance, and feeding back performance information. (See Table 8.1 in the text) B. Performance Appraisal is the process through which an organization gets information on how well an employee is doing his or her job. C. Performance Feedback is the process of providing employees information regarding their performance effectiveness. II. The practice of performance management 1. Several recent surveys of human resource professionals suggest that most companies’ performance management practices require annual paper-driven reviews that include both behavior and business goals. 2. Because companies are interested in continuous improvement and creating engaged employees—employees who know what to do are motivated to do it—many companies are moving to more frequent, streamlined performance reviews. III. The Process of Performance Management (See Figure 8.1). A. Performance Management does include the once or twice a year appraisal or evaluation meeting, but it is a process, not an event. B. Performance Management involves two steps. 1. Identifying what the company is trying to accomplish. 2. Understanding the process to achieve the goals established in the first step. C. Effective Performance Management requires that managers take time to provide feedback. IV. Purposes of Performance Management A. Strategic Purpose 1. First and foremost, a performance management system should link employee activities with the organization's goals. 2. Performance management is critical for companies to execute their talent management strategy. Integrity In Action: Listening and Recognizing a Good Job: Key Performance Management Practices Modeled by Company Leaders While the chapter emphasizes the importance of feedback, listening to employee concerns, and reinforcing employee positive behavior it remains difficult to get managers to do just that. The case talks about CarMax’s CEO, Tom Folliard, who visits all 119 CarMax stores to meet employees, answer questions, and seek feedback. Former chairman of Mattel, Robert Eckert, feels employees come to work motivated, but do not get the feedback they need to remain so. Both of these organizational leaders exhibit the behaviors managers should take heed of if they are going to inspire great performance from their employees. Discussion Question 1. What other things can company leaders do to create a culture that encourages feedback and recognition and reinforce the importance of performance management? Answer: Student answers will vary, but should exhibit an understanding and appreciation for the value of feedback and interaction between employees, employees and managers, and employees and organizational leadership. A culture of communication and inclusion will help with this. To create a culture that encourages feedback and recognition, and reinforces the importance of performance management, company leaders can: 1. Lead by Example: Demonstrate the behaviors they want to see in others. Leaders should regularly give constructive feedback and acknowledge achievements, setting a standard for managers to follow. 2. Implement Structured Feedback Systems: Establish formal mechanisms for feedback, such as regular performance reviews and 360-degree feedback processes. Ensure these systems are transparent and consistently applied. 3. Provide Training for Managers: Offer training programs focused on effective feedback and recognition techniques. Equip managers with the skills to give meaningful and timely feedback. 4. Create Recognition Programs: Develop formal recognition programs that celebrate achievements and milestones. Ensure these programs are inclusive and recognize both individual and team accomplishments. 5. Encourage Open Communication: Foster an environment where open communication is valued. Encourage employees to share their ideas and concerns without fear of retribution. 6. Solicit and Act on Employee Feedback: Actively seek feedback from employees through surveys, suggestion boxes, or focus groups, and take visible actions based on their input. This shows that feedback is valued and leads to tangible improvements. 7. Set Clear Performance Expectations: Clearly define performance goals and expectations. Regularly review progress and provide feedback to help employees understand how they can meet or exceed these expectations. 8. Promote a Culture of Continuous Improvement: Encourage a growth mindset where feedback is seen as an opportunity for development rather than criticism. Support ongoing learning and professional development. By implementing these strategies, company leaders can build a supportive culture that values feedback, recognizes achievements, and prioritizes effective performance management. B. Administrative Purpose 1. Performance management information is used for such admin¬istrative decisions such as salary administration, promotions, retention-termi-nation, layoffs, and recognition of individual performance. 2. Many managers see the performance appraisal process as a necessary evil, and they feel uncomfortable feeding back evalu¬ations to the employees; thus, they tend to rate everyone high, or at least rate them the same. C. Developmental Purpose 1. Performance management can be used to develop employees who are ineffective at their jobs. 2. Ideally, the performance management system identifies not only any deficient aspects of the employee’s performance but also the causes of these deficiencies—for example, a skill deficiency, a motivational problem, or some obstacle holding the employee back. V. Performance Measures Criteria A. Strategic congruence is the extent to which the performance management system elicits job performance that is congruent with the organization's strategy, goals, and culture. Competing Through Globalization: A Mix of Metrics are Needed to Support Local and Company Performance WD-40 is a company headquartered in San Diego, California and whose products are found under the sink, in the garage, and in toolboxes of customers all over the world. The company produces lubricants, heavy-duty hand cleaners, toilet bowl cleaners, bathroom cleaners, and carpet stain and room odor eliminators. WD-40 stands for “Water Displacement, 40th attempt.” WD-40 is a global company who, at one time, paid out bonuses to employees based upon overall financial performance and twenty percent by financial performance within an employee’s country. However, in 2008, the results of an employee survey showed that employees wanted more of their bonus to be linked to performance measures under their control. In response, the company placed greater emphasis on country-specific performance while still rewarded global business results. Discussion Question 1. One of the criteria used to evaluate a performance management system is strategic congruence. How would you evaluate WD-40s Double Vision program according to this criteria? Explain your evaluation.. Answer: Up until 2008, bonuses were more largely determined by global performance results and employees felt that this was not an optimal way to determine bonuses, because it left too much out of their control. Rewards should be tied to metrics over which employees can exert influence, otherwise the rewards are not meaningful. Therefore, the company changed the mix of the rewards to place a greater emphasis on country-specific performance. Since, however, it is a global company, it did keep some of the mix of rewards determined by global business results. This mixture appears to help align the performance management system with the organization’s global performance and hence strategy. B. Validity is the extent to which the performance measure assesses all the relevant—and only the relevant—aspects of job performance. It is also called "content validity." 1. Validity is concerned with maximizing the overlap between actual job performance and the measure of job performance (Figure 8.2). 2. A performance measure is deficient if it does not measure all aspects of performance. Example: A company's performance measure for managers is deficient because it does not measure such aspects of managerial performance as developing others or social responsibility. 3. A contaminated measure evaluates irrelevant aspects of perfor¬mance or aspects that are not job related. Example: A company's performance measure would be contaminated if it evaluated its managerial employees based on how physically attractive they were. C. Reliability refers to the consistency of the performance measure. 1. Interrater reliability is the consistency among the individuals who evaluate the employee's performance. 2. With some measures, the extent to which all the items rated are internally consistent is important (internal consistency reliability). 3. The measure should be reliable over time (test retest reliability). D. Acceptability refers to whether the people who use the performance measure accept it. It is affected by the extent to which employees believe the performance management system is fair (Table 8.2). E. Specificity is the extent to which a performance measure gives specific guidance to employees about what is expected of them and how they can meet these expectations. Example: Paula, a sales representative for a brokerage firm, is expected to record 25 cold calls per day and call each client on her books every two weeks. She is also expected to make sales of at least $30,000 per month to remain in her position. VI. Approaches to Measuring Performance A. The Comparative Approach—The comparative approach to perfor¬mance requires the rater to compare an individual’s performance with that of others. 1. Ranking is one of the techniques that arrive at an overall assessment of the individual's performance. a. Simple ranking requires managers to rank employees within their departments from highest performer to poorest performer. b. Alternation ranking consists of a manager looking at a list of employees, deciding who is the best employee, and crossing that person’s name off the list. c. In the courts, the ranking system has not been looked at favorably. 2. Forced Distribution—The forced distribution method requires the managers to put certain percentages of employees into predetermined categories. (Table 8.3 in the text) 3. Paired Comparison—The paired comparison method requires managers to compare every employee with every other employee in the work group, giving an employee a score of one every time he or she is considered the higher performer. Employees are ranked by how many points they receive. 4. Evaluating the Comparative Approach a. The comparative approach is an effective tool in differentiating employee performance; it virtually eliminates problems of leniency, central tendency, and strictness. b. Comparative approach techniques are not linked to the strategic goals of the organization; the validity and reliability depend on the raters themselves due to the subjective nature of the ratings, and they lack specificity for feedback purposes. B. The Attribute Approach—The attribute approach to performance management focuses on the extent to which individuals have certain attributes (characteristics or traits) believed to be desirable for the company's success. 1. Graphic Rating Scales a. Graphic rating scales can provide a number of different points (a discrete scale) or a continuum along which the rater simply places a check mark (a continuous scale). (Table 8.4 in the text) 2. Mixed Standard Scales a. Mixed standard scales are developed by defining the rele¬vant performance dimensions with statements representing good, average, and poor performance along each dimension (text Table 8.5). 3. Evaluating the Attribute Approach a. Attribute-based performance methods are the most popular methods in organizations. They are easy to develop and are generalizable across a variety of jobs, strategies, and organizations. b. There is usually little strategic congruence between the attribute approach methods and the company's strategy; they usually have very vague standards that result in low validity and reliability; and when raters give feedback, these techniques tend to elicit defensiveness from employees. C. The Behavioral Approach—The behavioral approach to performance management attempts to define the behaviors an employee must exhibit to be effective in the job. 1. Behaviorally anchored rating scales (BARS) specifically define performance dimensions by developing behavioral anchors associated with different levels of performance (text Figure 8.4). a. BARS can increase interrater reliability by providing a precise and complete definition of the performance dimension. b. BARS can bias information recall—that is, behavior that closely approximates the anchor is more easily recalled than other behaviors. Also, research has demon¬strated that managers and their subordinates do not make much of a distinction between BARS and trait scales. 2. Behavioral observation scales (BOS) is a variation of a BARS. They are developed from critical incidents but use a larger number of the behaviors that are necessary for effective performance. Rather than assessing which behavior best reflects an individual’s performance, a BOS requires managers to rate the frequency with which the employee has exhibited each behavior during the rating period. These ratings are then averaged to compute an overall performance rating (text Table 8.6). a. BOS consume more of the manager's time than BARS and may require more information than most managers can process or remember. b. A direct comparison of BOS, BARS, and graphic rating scales found that both managers and employees prefer BOS for differentiating good from poor performers, maintaining objectivity, providing feedback, suggesting training needs, and being easy to use among managers and subordinates. 3. Competencies: sets of skills, knowledge, abilities and personal characteristics that enable employees to successful perform their jobs. a. A competency model identifies the competencies necessary for each job. Competency models provide descriptions of competencies that are common for an entire occupation, organization, job family, or specific job. b. Table 8-7 shows the competency model that Luxottica Retail known for premium, luxury, and sports eyewear sold through Lens Crafters, Sunglass Hut, and Pearle Vision developed for its associates in field and store positions. 4. Evaluation of the Behavioral Approach a. The behavioral approach can link the company's strategy to specific behaviors; it provides specific guidance and feedback for employees about the performance expected of them. The major weaknesses have to do with the organizational context of the system. The behaviors must be constantly monitored to ensure they are linked to the corporate strategy, and the approach is not suited for complex jobs where there are multiple ways to achieve success. This approach assumes there is “one best way” to do the job. D. The Results Approach—The results approach to performance management focuses on managing the objective, measurable results of a job or work group. This approach assumes that subjectivity can be eliminated from the measurement process and that results are the closest indicator of one's contribution to organizational effectiveness. 1. The Use of Objectives a. The most effective goals are SMART goals. That is, the goals are specific (clearly state, define the result to be achieved), measurable, attainable, and timely. b. Research on objectives has revealed that objectives usually increase productivity (see Table 8.8). 2. Balanced Scorecard approach a. The balanced scorecard includes four perspectives of performance including financial, customer, internal or operations, and learning and growth (see Table 1.9 in Chapter 1). 3. Productivity Measurement and Evaluation System (ProMES) a. Productivity measurement and evaluation system (ProMES) consists of four steps: (1) identify the objectives the products, or the set of activities or objectives, the organization expects to accomplish; (2) the staff defines indicators of the products; (3) the staff establishes the contingencies between the amount of the indicators and the level of evaluation associated with the amount; (4) a feedback system is developed that provides employees and work groups with information about their specific level of performance on each of the indicators. b. ProMES is somewhat new, but some research has shown increased productivity (text Figure 8.6). ProMES also tends to be an effective feedback mechanism. c. ProMES, however, it is time consuming to develop. 4. Evaluating the Results Approach a. The results approach minimizes subjectivity, relying on objective, quantifiable indicators of performance. It is highly acceptable and links an individual’s results with the organization’s strategies and goals. a. Objective measurements can be both contaminated and deficient; individuals may focus only on aspects of their performance that are being measured; and the feedback may not help employees learn how they need to change. E. The Quality Approach—Two fundamental characteristics of the quality approach are a customer orientation and a prevention approach to errors. Improving customer satisfaction is the primary goal of the quality approach. 1. Kaizen refers to practices participated in by employees from all levels of the company that focus on continuous improvement of business processes. A performance management system designed with a strong quality orientation can be expected to: a. Emphasize an assessment of both person and system factors in the measurement system. b. Emphasize that managers and employees work together to solve performance problems. c. Involve both internal and external customers in setting standards and measuring performance. d. Use multiple sources to evaluate person and system factors. 2. Objective Performance Evaluation feedback--Statistical process quality control techniques are used to provide employees with an objective tool to identify causes of problems and potential solutions. a. Process flow analysis involves identifying each action and decision necessary to complete work. b. Cause and effect diagrams identify events or causes that result in undesirable outcomes. c. A Pareto chart is used to highlight the most important cause of a problem. Causes are listed in decreasing order of importance (text Figure 8.7). d. Control charts involve collecting data at multiple points in time so that employees can identify what factors contribute to an outcome and when they tend to occur (text Figure 8.7). e. Histograms display distributions of large sets of data and allow data to be grouped into a smaller number of categories or classes (text Figure 8.8). f. Scattergrams show the relationship between two variables, events, or different pieces of data. 3. Evaluation of the Quality Approach a. The quality approach relies primarily on a combination of the attribute and results approaches to performance measurement. The quality approach adopts a systems oriented focus in which traditional performance systems focus on individual employee performance. b. Many companies may be unwilling to completely abandon their traditional performance management system because it serves as the bias for personnel selection validation, identification of training needs, or compensation decisions. 4. Evaluation of Approaches to Performance Measurement—Table 8.9 summarizes the various approaches to measuring performance based on the criteria set forth earlier (strategic congru¬ence, validity, reliability, acceptability, and specificity) and illustrates that each approach has strengths and weaknesses. VII. Choosing a Source for Performance Information A. Managers are the most frequently used source. 1. Supervisors usually have extensive knowledge of the job and have had the opportunity to observe their employees. 2. Because supervisors have something to gain from employees' high performance and something to lose by low performance, they have the motivation to make accurate ratings. Also, feed¬back from supervisors is strongly related to performance. 3. However, in some instances, supervisors do not observe employees, and supervisors may be biased against a particular employee. In addition, favoritism must be minimized as much as possible in performance management. Competing Through Sustainability: Connecticut Health Foundation Evaluates Performance from Different Perspectives to Insure It Meets Its Mission and Goals Discussion Question 1. What source(s) for performance information do you think it is best to use to determine whether employees are working toward the organization’s long-term goals and mission, and ultimately its future? Answer: Student answers will vary, but should express their appreciation for strategic alignment. In the case of CHF, several “soft” criteria, such as attitudes and morale, might be good measures and sources of information concerning them come from a variety of places. The example in the vignette of group morale as a measure of a manager’s effectiveness in leading them is a great illustration. To determine whether employees are working toward the organization’s long-term goals and mission, and ultimately its future, the following sources of performance information can be highly effective: 1. Key Performance Indicators (KPIs): Use KPIs that align with the organization's long-term goals and mission. These metrics provide quantitative data on employee performance and progress towards strategic objectives. 2. Performance Reviews: Regular performance evaluations offer qualitative insights into how employees are contributing to organizational goals. These reviews should be linked to the company’s mission and long-term objectives. 3. Employee Goal Setting: Evaluate whether individual goals and objectives are aligned with the organization’s strategic goals. Assessing the alignment of personal goals with company mission helps ensure employees are focused on the right areas. 4. 360-Degree Feedback: Collect feedback from multiple sources including peers, subordinates, and supervisors to get a comprehensive view of how employees are performing and contributing to organizational goals. 5. Balanced Scorecards: Utilize a balanced scorecard approach to measure performance from multiple perspectives (financial, customer, internal processes, and learning and growth) to ensure alignment with strategic goals. 6. Employee Engagement Surveys: Assess employee engagement and satisfaction to understand how motivated and committed employees are to the organization’s mission and long-term objectives. 7. Mission-Driven Project Outcomes: Review the outcomes of projects and initiatives directly related to the organization's mission to see how effectively employees are working towards achieving long-term goals. 8. Benchmarking: Compare performance metrics and practices against industry standards or similar organizations to gauge how well employees are contributing to achieving the organization’s goals. Using these sources provides a well-rounded view of employee performance and its alignment with the organization's mission and long-term objectives. 2. What performance outcomes (attributes, behaviors, competencies, objective results) would you assess?? Answer: Again, the answers here will vary and need to be in line with the idea of being able to assess the outcomes and their relationship to strategic alignment with the organization’s mission, goals and objectives. To comprehensively assess performance outcomes, you should consider evaluating the following attributes, behaviors, competencies, and objective results: 1. Attributes: • Commitment to Mission and Values: Evaluate how well employees align with and demonstrate the organization's mission and core values. • Professionalism: Assess attributes such as reliability, integrity, and accountability in performing job duties. 2. Behaviors: • Collaboration and Teamwork: Observe how effectively employees work with others, contribute to team goals, and support colleagues. • Communication Skills: Evaluate employees’ ability to communicate clearly and effectively with peers, supervisors, and external stakeholders. • Problem-Solving and Initiative: Assess how proactively employees identify issues, develop solutions, and take initiative to address challenges. 3. Competencies: • Technical Skills: Measure proficiency in job-specific technical skills and knowledge required for the role. • Leadership and Management Skills: For managerial roles, evaluate skills in leading teams, managing projects, and driving performance. • Adaptability and Learning Agility: Assess the ability to adapt to changes, learn new skills, and respond effectively to evolving demands. 4. Objective Results: • Achievement of Goals and Targets: Review progress towards specific, measurable goals and targets set for the employee or team. • Quality of Work: Measure the accuracy, completeness, and overall quality of the work produced. • Productivity and Efficiency: Assess output levels, efficiency in completing tasks, and effectiveness in using resources. • Customer or Client Satisfaction: Evaluate feedback from customers or clients regarding their satisfaction with services or products delivered by the employee or team. By assessing these performance outcomes, you can gain a comprehensive understanding of how employees are contributing to the organization’s long-term goals and mission. B. Peers 1. Peers, or coworkers, are excellent sources of information when the supervisor does not always observe the employee. 2. Peers may be biased and may be uncomfortable with being the rater when the ratings are used for administrative decisions. C. Subordinates 1. Subordinates are a valuable source of performance informa¬tion when managers are evaluated. They often have the best opportunity to evaluate how well a manager treats employees. 2. Upward feedback refers to an appraisal that involves subordinates’ evaluations of the manager’s behavior or skills (see Table 8.10). 3. Allowing subordinates to rate managers gives subordinates power over their managers, thus putting the manager in a difficult situation. This can lead to managers’ emphasizing employee satisfaction over productivity. Also, subordinates may fear retribution from their managers if the evaluations are not anonymous. D. Self 1. Self ratings can be valuable but are not usually used as the sole source of performance information. 2. One problem with self ratings is a tendency toward inflated assessments, especially if ratings are used for administrative decisions. 3. The best use of self ratings is as a prelude to the performance feedback session to make employees think about their perfor¬mance and to focus discussion on areas of disagreement. E. Customers 1. In some instances, the customer is often the only person present to observe the employee's performance. 2. The main weakness of customer surveys is that they are some¬what expensive. F. The best source of performance information 1. One should choose the sources that provide the best opportu¬nity to observe employee behavior and results. (Table 8.10 summarizes this information.) 2. One popular trend in organizations is called 360 degree appraisals. This technique consists of having multiple raters (boss, peers, subordinates, customers) provide input into a manager’s evaluation. (This technique is discussed in Chapter 9.) Evidence-Based HR Fallon Clinic is a group medical practice with over 1700 employees. Of these, 350 are doctors and advanced practitioners and the remaining employees are nurses, therapists, lab technicians, and administrative and clerical support. Fallon Clinic recognizes that there are specific staff and clinical behaviors that are critical for patient satisfaction. Fallon Clinic created the “Patient Shadowing Program” which involves staff members “shadowing” consenting patients on their appointments to observe the patient experience. Volunteers were selected based upon their strong interpersonal, communications, and feedback skills and were trained how to use rating templates. There has been a six percent average increase in patient satisfaction scores. Exercise 1. Break the class into four small groups. Have one group discuss their observations about the behaviors and competencies that they feel would be optimal for doctors to have and to exhibit; have another group discussion Have one group discuss their observations about the behaviors and competencies that they feel would be optimal for nurses to have and to exhibit; Have one group discuss their observations about the behaviors and competencies that they feel would be optimal for lab techs to have and to exhibit; and then have one group discuss their observations about the behaviors and competencies that they feel would be optimal for front office staff to have and to exhibit. Have each small group appoint a scribe, to report the discussions of each small group back to the large group. On four separate whiteboards, list the behaviors and competencies of each of these employee groups (doctors, nurses, etc.). Facilitate a large group discussion where you compare and contrast the lists. Then, have the group discuss what the implications for a program such as “Patient Shadowing Program.” VIII. Use of Technology in Performance Management- Technology is influencing performance management systems in three ways: A. As we have seen in the chapter many companies are moving to web-based online paperless performance management systems. B. Second, social media tools such as Facebook and Twitter are increasingly being used to deliver timely feedback. C. Third, companies are relying on electronic tracking and monitoring systems and software to ensure that employees are working when and how they should be and to block access to visiting certain websites (such as those containing pornographic images). Competing Through Technology: Social Media Tools Help Make Performance Management a Daily Event Many employees are no longer waiting fro a formal performance appraisal to receive feedback or help them understand how to improve. Employees are increasingly relying on social networking for performance feedback whether on not the organization is using Facebook, Twitter, or My Space as part of its performance management process. Recognizing the potential use of social networking for performance management and capitalizing on the employees needs for feedback from peers as well as their managers, forwarding-thinking companies are developing websites or purchasing software to help make performance management more of an ongoing dynamic process. Discussion Question 1. Consider the performance management process shown in Figure 8.1. On which step(s) in the process do you think social media tools can have the greatest positive influence? Answer: The advantages for employees receiving feedback through social networking tools are that they can receive feedback in a timely way, and they can obtain feedback from a variety of sources including managers and peers. They can rely on the authenticity of this feedback because it is aggregated so that they reviewers have anonymity. This is beneficial to employees, because it means that the feedback that they receive is likely to be genuine, and untainted by agendas other than to give honest and constructive performance feedback. As such, steps 2 and 3 appear to have the greatest potential to be influenced in a positive way. 2. What are the potential disadvantages of using social media tools in performance management? Answer: Drawbacks could include an employee’s discomfort with social networking technologies, or discomfort in receiving feedback very soon after a presentation or other type of professional activity. The speed of the information, in other words, might be a bit daunting for employees who are not used to the fast pace that social networking affords. A. Reducing Rater Errors, Politics, and Increasing Reliability and Validity of Ratings 1. Rater error training attempts to make managers aware of rating errors and helps them develop strategies for minimizing those errors. 2. Rater accuracy training, also called frame of reference training, attempts to emphasize the multidimensional nature of perfor¬mance and thoroughly familiarizes raters with the actual content of various performance dimensions. 3. Typical Rater Errors are shown in Table 8.11 4. Appraisal politics refers to evaluators purposefully distorting ratings to achieve personal or company goals. An important way to help ensure that performance is evaluated consistently across managers and to reduce the influence of rating errors and politics on appraisals is to hold calibration meetings. Calibration meetings provide a way to discuss employees’ performance with the goal of ensuring that similar standards are applied to their evaluations. 5. To reduce appraisal politics, companies can do many things to keep evaluators from distorting results. See Table 8.2 in the Text. Managers can also: • Build top management support for the appraisal system and actively discourage distortion. • Give raters some latitude to customize performance objectives and criteria for their ratees. • Recognize employee accomplishments that are not self-promoted. • Provide employees with access to information regarding which behaviors are desired and acceptable at work. • Encourage employees to actively seek and use feedback to improve performance. • Make sure constraints such as budget do not drive the process. • Make sure appraisal processes are consistent across the company. • Foster a climate of openness to encourage employees to be honest about weaknesses. IX. Performance Feedback - Performance Feedback is a process that is complex and provokes anxiety for both the manager and the employee. The Manager’s Role in an Effective Performance Feedback Process: Ways to Improve Performance Feedback Process 1. Feedback should be given every day, not once a year. a. Managers have a responsibility to correct performance defi¬ciencies immediately upon becoming aware of them. b. A major determinant of how effectively a feedback session goes is the extent to which the subordinate is not surprised by the evaluation. 2. Create the right context for the discussion a. Managers should choose a neutral location for feedback. b. Managers should describe the meeting as an opportunity for the employee. c. Manager should also encourage open dialogue. 3. Ask the employee to rate his or her performance before the session. a. Self ratings require employees to think about their perfor¬mance, including their weaknesses. b. The feedback session can go more smoothly by focusing discussion on areas of disagreement. c. Employees will be more likely to participate fully in the feedback session. 4. Encourage the subordinate to participate in the session. a. Even though the problem solving approach is the superior approach, most managers still use the tell and sell or the tell and listen approach. b. When employees participate in the feedback session, they are consistently satisfied with the process. 5. Recognize effective performance through praise. 6. Focus on solving problems. 7. Focus feedback on behavior or results, not on the person. 8. Minimize criticism. 9. Agree to specific goals and set a date to review progress. Evidence-Based HR: Google Google put its ability to analyze vast amounts of data to work to learn a little about itself. First, for a company who previously operated without managers, they discovered that teams with good managers outperformed teams with bad managers. Second, they were able to distill 10,000 observations about managers into a list of 8 behaviors exhibited by managers that get good results. These were used to develop training programs for its poorest performing managers that resulted in improvements in manager quality for 75% of them. Exercise Break students into small groups and ask them to analyze the list of 8 behaviors identified by Google. Ask the groups to create themes from those behaviors that might serve as guidelines for any manager in leading their team. X. What Managers Can Do to Diagnose Performance Problems and Manage Employees’ Performance A. Diagnosing the Causes of Poor Performance: Many different reasons can cause an employee’s poor performance. The different factors that should be considered in analyzing poor performance are shown in Figure 8.8. B. Actions for Managing Employees’ Performance: Table 8.12 shows actions for the manager to take with for different types of employees. XI. Developing and Implementing a System That Follows Legal Guidelines A. In discrimination suits, the plaintiff often claims that the perfor¬mance ratings were subjective and that the rater was biased and influenced by gender or racial stereotypes 1. Research has shown that both white and black raters give higher ratings to members of their own race, even after rater training. 2. Discriminatory biases in ratings are worse when one group makes up a small percentage of the work group. B. In unjust dismissal suits, the plaintiff often claims that the dismissal was for reasons other than those the employer claims. The court case will likely focus on the performance system that was used as the basis for claiming the employee's performance was poor. There are certain characteristics of a system that will withstand legal scrutiny. 1. A valid job analysis that ascertains the important aspects of job performance. 2. A system based on either behaviors or results. 3. Raters trained in how to use the system. 4. Some form of review by upper level managers and a system for employee appeal. 5. Some form of performance counseling or corrective guidance to help poor performers. 6. Multiple raters should be used. 7. Performance evaluations need to be documented. A Look Back The chapter opener on VivaKi Nerve Center and Eastern Idaho Regional Medical Center discussed how values should play an important role in a successful performance management system and how there has to be emphasis on more than just financial performance. Questions 1. Why might peer or coworker evaluations be necessary to evaluate values? Answer: The reason these types of evaluations might be needed in assessing values is that there is no clear, measurable metric to determine this. Often, values are linked with behaviors and those behaviors will be witnessed more by peers and coworkers than my managers. 2. Do you think evaluations of values should receive equal, more, or less weight than evaluation of objectives (or what the employee accomplishes) in employees’ performance evaluation? Why? Answer: It is good practice to include both objective measures, as well as behaviors, because the two are linked. It would be hard to imagine, for example, an employee demonstrating consistently strong performance without also demonstrating the type of behaviors that are consistent with the values of the organization. Therefore, yes, it is a good idea to include both of these in the performance appraisal system. In terms of weighting, students responses will vary based on their opinion but should demonstrate an understanding of the linkages between values, behaviors and performance as discussed in the chapter. 3. Are values only important for organizations that have a sales force or provide some type of customer service? Explain your answer. Answer: The answer here should be a strong no. Values are critical for any organization and are a major part of the organization’s culture. Chapter Vocabulary These terms are defined in the "Extended Chapter Outline" section. Performance management Performance appraisal Performance feedback Strategic congruence Validity Reliability Acceptability Specificity Competencies Competency model Kaizen Upward feedback 360 degree appraisals Appraisal politics Calibration meetings Discussion Questions 1. What are examples of administrative decisions that might be made in managing the performance of professors? Developmental decisions? Answer: Examples of administrative decisions for professors include pay raises, promotions, tenure decisions, layoffs, and recognition of individual performance. Developmental decisions include working with professors who tend to be having problems with teaching, dealing with students, research productivity, or dealing with colleagues. 2. What would you consider the strategy of your university (e.g., research, undergraduate teaching, graduate teaching, combination)? How might the performance management system for faculty members fulfill its strategic purpose of eliciting the types of behaviors and results required by this strategy? Answer: Student answers may vary depending on the university, and some students may not be aware of what the university's strategy is; however, the performance management system should emphasize the university's strategy. For instance, a research institution should emphasize research in the performance system for professors. The strategy of a university can vary based on its focus, whether it's research-intensive, focused on undergraduate teaching, or graduate education. Here’s how a performance management system can align with these strategies: 1. Research-Focused University: • Performance Management Focus: Emphasize research output, grant acquisition, publications in high-impact journals, and contributions to advancing knowledge. • Assessment Metrics: Track research funding received, number of published papers, citations, research collaborations, and impact on the field. • Behavioral Expectations: Encourage faculty to pursue innovative research, secure grants, and contribute to the academic community through conferences and publications. 2. Undergraduate Teaching-Focused University: • Performance Management Focus: Prioritize teaching effectiveness, student engagement, curriculum development, and mentoring. • Assessment Metrics: Use student evaluations, peer reviews of teaching, course completion rates, and academic advising effectiveness. • Behavioral Expectations: Promote high-quality teaching, active student engagement, and continuous improvement of instructional methods. 3. Graduate Teaching-Focused University: • Performance Management Focus: Focus on supervising graduate students, publishing research, and contributing to the advancement of specialized fields. • Assessment Metrics: Evaluate the number of graduate students mentored, success rates of student theses/dissertations, and faculty’s contributions to their discipline. • Behavioral Expectations: Encourage effective mentorship, support graduate students’ research endeavors, and foster academic growth in specialized areas. 4. Combination Strategy: • Performance Management Focus: Balance between research, undergraduate, and graduate teaching. Integrate performance metrics that address all areas of focus. • Assessment Metrics: Track research achievements, teaching evaluations, student outcomes, and contributions to both undergraduate and graduate education. • Behavioral Expectations: Promote a balanced approach where faculty excel in research, contribute to effective teaching, and support both undergraduate and graduate students. Performance Management System Implementation: • Set Clear Goals: Define objectives that align with the university’s strategic focus, ensuring that faculty members understand expectations in research, teaching, or both. • Regular Reviews: Conduct periodic performance evaluations to assess progress and provide feedback. Tailor evaluations to the strategic focus of the university. • Provide Support: Offer resources and professional development opportunities that support faculty in achieving their goals, whether in research, teaching, or a combination. • Recognize and Reward: Develop a system for recognizing and rewarding achievements that contribute to the university’s strategic goals, such as research excellence, effective teaching, or successful mentoring. By aligning the performance management system with the university's strategic focus, you can ensure that faculty behaviors and results support the institution's mission and long-term objectives. 3. What do you think is the most important step shown in the model of the performance management process? Justify your answer. Answer: Although responses can vary, it might be the best response to say that the first step of the process is the most important. In this first step, performance outcomes are defined. Without such definition, no other step in the process can be workable or successful. However, a case could likely be made for each step, as long as the student provides an articulate and substantive justification. The most important step in the performance management process is "Setting Clear Objectives." Clear objectives align individual and team goals with the organization’s strategic aims, providing direction and focus. This step ensures that performance evaluations are relevant and measurable. Without well-defined objectives, it’s challenging to assess progress, provide meaningful feedback, or drive performance improvements. Setting clear objectives lays the foundation for all subsequent performance management activities. 4. What sources of performance information would you use to evaluate faculty members' performance? Answer: Sources of performance information for professors could include students, advisees, colleagues, department heads, and self ratings. To evaluate faculty members' performance, consider the following sources of performance information: 1. Student Evaluations: Gather feedback from students on teaching effectiveness, engagement, and support. 2. Peer Reviews: Obtain assessments from colleagues on teaching quality, research contributions, and departmental involvement. 3. Research Output: Measure publications, research grants, citations, and contributions to academic conferences. 4. Teaching Portfolio: Review syllabi, course materials, and innovations in teaching methods. 5. Graduate Outcomes: Assess the success of graduate students supervised, including their academic and career achievements. 6. Self-Assessments: Include faculty self-reports on achievements, challenges, and reflections on their contributions. 7. Administrative Reviews: Consider evaluations from department chairs or deans on overall performance and alignment with institutional goals. 5. What are the advantages and disadvantages of a performance management system that evaluates values? Answer: Advantages to using a performance management system that evaluates values includes the linkage between business objectives and employee behaviors, as evidenced by examples in this chapter such as Zappos. When an organization has a strongly identified set of values that the company communicates to employees, and uses as part of the performance management process, it reinforces a strong sense of company culture. This is a good thing. However, if culture is weak, or if it is impermanent and loosely prioritized by senior management, then it would not be a good idea to evaluate values. The results of doing so could be confusing for employees, and it could even taint the performance management process. 6. Think of the last time that you had a conflict with another person, either at work or school. Using the guidelines for performance feedback, how would you provide effective feedback to that person? Answer: Students might suggest focusing on problem solving and trying a problem solving approach instead of a tell and¬ sell or tell and listen approach, focusing feedback on the behavior and not the person, minimizing criticism, and recognizing effective performance through praise. To provide effective feedback on a recent conflict, I would: 1. Be Specific: Clearly describe the behavior or incident that caused the conflict, avoiding generalizations. 2. Focus on Impact: Explain how the behavior affected the work or relationship, highlighting its impact. 3. Be Constructive: Offer practical suggestions for improvement and ways to resolve the issue. 4. Listen Actively: Allow the other person to share their perspective and concerns. 5. Seek Solutions Together: Collaborate on finding mutually acceptable solutions and ways to prevent similar conflicts in the future. 7. Explain what fairness has to do with performance management? Answer: The three categories of fairness are procedural fairness, interpersonal fairness, and outcome fairness. In procedural fairness, managers should give employees the opportunity to participate in the development of the system, ensure consistent standards, and minimize rating error and biases. In interpersonal fairness, managers should have timely and complete feedback, allow employees to challenge the evaluation, and provide feedback in an atmosphere of respect and courtesy. In outcome fairness, managers should communicate expectations regarding performance evaluations and standards and communicate expectations regarding rewards. 8. Why might a manager intentionally distort appraisal results? What would you recommend to minimize this problem? Answer: Managers might purposefully distort appraisal because managers are accountable for the employees being rated, there might be competing goals within the organization, and if there is a direct link between performance appraisals and highly desirable rewards. To minimize this, managers can adhere by Table 8.2 in the book as well as: •Train managers on the appropriate use of the system •Build top management support •Recognize employee accomplishments that are not self-promoted •Have an open culture within the organization 9. Can electronic monitoring of performance ever be accepted to employees? Explain. Answer: Student answers may vary. Explore with students both sides of the issue; Company side—monitoring performance to weed out poor performers and reward top performers; affects the productivity and overall competitiveness; employee side—trust and privacy issue. Electronic monitoring of performance can be accepted by employees if implemented transparently and fairly. Clear communication about the purpose, scope, and benefits of monitoring is crucial. Ensuring that monitoring is used to support development rather than solely for punitive measures helps gain acceptance. Providing employees with access to their data and involving them in setting performance metrics can also foster trust and cooperation. When handled correctly, it can enhance accountability and performance without undermining morale. 10. A delivery driver contaminated a hospital’s oxygen supply by refilling the hospital’s main oxygen supply line with trichloroerthane, a mild anesthetic. Following detection of the contamination, all patients were switched to oxygen tanks and no patients were injured. How would you diagnose the cause of this performance problem? Explain. Answer: Student answers may vary. The cause of the performance problem could be due to the lack of ability on the part of the delivery driver. To diagnose the cause of this performance problem, first, analyze the procedures and training related to handling and refilling oxygen supplies. Investigate whether proper protocols were followed and if there were any lapses in training or oversight. Examine the equipment and check for any mix-up in procedures or labeling errors. Assess the overall system for safeguarding against such errors, including cross-checks and supervision. Identifying these factors helps in implementing corrective actions to prevent future occurrences. 11. How can the use of social media such as Facebook and Twitter-like applications benefit the performance management process? Answer: Technology such as online performance management, and also, the use of social media like Facebook and Twitter, can capture and then communicate performance in ways that are swift as well as objective an reliable for employees. Technology can facilitate the capturing and communication of performance, for example, from multiple perspectives including peers, superiors and clients which can provide insights for employees about their performance. When a system is online, managers can document and then retrieve information that they gather throughout the year, and use that data to inform the formal performance management meeting with their employees. Therefore, there are several ways that technology can benefit this process. Self-Assessment Exercise Refer to the text for the self-assessment exercise. Exercising Strategy: Cascading Goals Baxter HealthCare Corporation has an automated goal-alignment system that about half of its 55,000 employees participate in. At Baxter the process starts with the company’s strategic goals known as the four B’s (Best Team, Best Partner, Best Investments, Best Citizen). The executives develop goals underneath each category, which are then collected in a performance management system. Questions 1. How does this type of goal-setting process contribute to effective performance management? Answer: This type of goal setting helps to create a systematic, consistent, strategically aligned performance management process. It also helps employees to understand what is expected of them. 2. Baxter uses a website to provide guidance on how to write goals. What are the characteristics of effective goals and objectives that should be emphasized on the website? Answer: The goals and objectives should be specific, measureable, attainable, and timely. 3. What are the potential disadvantages of relying entirely on goals or objectives for performance management? What recommendations would you give, if any, to Baxter to increase the effectiveness of the system? Answer: The reliance on goals and objectives may reduce or even eliminate the possibility for creativity or innovation on the part of the supervisor in conducting the appraisal, or on the part of the employee receiving the appraisal. If an appraisal is strictly based upon goals and objectives, there is little to no room for improvisation. This could limit the range of discussion as well as appraisal, and it could reduce the incentives for initiating new ideas or creating new ways of performing a job. Managing People: Performance Management Helps Turn Around a Healthcare Organization Scripps Health is a private, nonprofit community health system located in San Diego, California and they had financial problems. Money was being lost, their CEO resigned, nursing turnover was high, and employee morale was low. A key change that the company instituted was a new online performance management system designed to focus on leadership development, metrics, recognition of employees and business unit performance, and using compensation to motivate employees. The initiative apparently worked - since 2008 Scripps has been named one of the 100 Best Companies to Work For by Fortune magazine. Discussion Question 1. This chapter discusses five criteria for effective performance appraisals: Strategic congruence, validity, reliability, acceptability, and specificity. Evaluate the Scripps Health appraisal system on each criterion. That is, decide whether the appraisal system meets the criterion, falls short of the criterion, or exceeds the criterion. Provide evidence of each. Answer: There are several reasons that the Scripps Health appraisal system exceeds the criterion for effective performance appraisals (strategic congruence, validity, reliability, acceptability, and specificity). The system has strategic congruence because managers choose the goals at the beginning of the year, and goals are determined collaboratively. This exceeds the criterion of strategic congruence. The system results in valid appraisals, because the performance appraisal evaluates employees on annual objectives and behaviors related to the Scripps core values (respect, quality, and efficiency). The system is reliable because Scripps Health performance management process encourages managers and employees to work together in evaluating performance, setting measurable goals, indentifying areas for performance improvement, and recognizing excellent performance. The system is valid and reliable because of the consistency that is inherent in its implementation. The system is acceptable because employees are given the opportunity to co-create their appraisals with management. The system is specific because the online system makes it easier for managers to set personal, employee, and department goals that are linked to functional and organizational goals (a process known as “cascading” goal setting) because it captures data for employees who might be involved in many different conservation and other projects. 2. What are the strengths and weaknesses of online appraisal systems such as the one used by Scripps Health? What changes would you recommend for the system to improve its weaknesses? Answer: Student responses may vary. It is mostly a very strong web-based appraisal system that exceeds the five criterion for effective performance appraisals. Weaknesses could possibly include the possibility that managers do not conduct as effective of “in person” meetings as they could, perhaps relying on the system to give performance feedback. As long as the face to face element of performance appraisal is not lost, there are likely to be few weaknesses with this web based system. Strengths of Online Appraisal Systems: 1. Efficiency and Accessibility: Streamlines the appraisal process and makes it accessible to both managers and employees from any location. 2. Consistency: Ensures standardized evaluation criteria and reduces bias in performance reviews. 3. Data Tracking and Analytics: Provides robust data collection and analysis, enabling better tracking of performance trends and outcomes. 4. Integration with Other HR Systems: Can integrate with other HR functions like payroll and training, facilitating a holistic view of employee performance. Weaknesses of Online Appraisal Systems: 1. Lack of Personal Interaction: May reduce face-to-face communication and feedback, which can impact the depth and quality of reviews. 2. Technical Issues: Dependence on technology can lead to problems such as system glitches or accessibility issues. 3. Impersonal Feedback: Risk of feedback becoming generic or impersonal, lacking the nuance that in-person evaluations might offer. 4. Data Security and Privacy: Concerns over the security of sensitive performance data and privacy of employee information. Recommended Changes to Improve Weaknesses: 1. Incorporate Regular Face-to-Face Meetings: Complement online appraisals with periodic in-person meetings to discuss feedback and development in a more personal and interactive setting. 2. Enhance Technical Support: Ensure robust technical support and system reliability to minimize disruptions and issues with the online system. 3. Personalize Feedback: Train managers to provide personalized and specific feedback, even within an online system, to ensure it is meaningful and actionable. 4. Strengthen Data Security: Implement advanced security measures to protect performance data and address any privacy concerns. By addressing these weaknesses, the online appraisal system can become more effective and supportive in managing performance. HR In Small Business: Small Business Performance Management Brian Conrad is the practice manager at the Meadow Hills Veterinary Center. He claims his staff is his number one asset, and backs that claim up with how the performance management system is managed at their two Washington state facilities. Performance interviews are conducted with the practice’s owners and employees are full participants in the process. Evaluation forms are given to employees a few months ahead of time so they have time to look them over and see what measures are being evaluated, and the meetings are conducted twice each year. Additionally, compensation discussions are separate from performance discussions so employees can concentrate on feedback rather than worry about their raise. Feedback on performance problems is given throughout the year, and gives positive feedback when possible. Discussion Question 1. Based on the information given, discuss how well the performance management at Meadow Hills Veterinary Center meets its strategic, administrative, and developmental purposes. Answer: The system apparently works based on their 10% turnover rate in an industry that averages 30%. Conrad asks employees informally about career goals and uses that information to work on developmental issues. 2. What methods for measuring employee performance do you think would be most beneficial for Meadow Hills? Why? Answer: Student answers will vary. It appears that performance should be measured there by much more than financial performance. In this case, learning goals and other “soft” objectives (i.e. attitudes, behaviors, etc.) might be useful here. • 360-Degree Feedback: Involves gathering feedback from various sources such as peers, supervisors, and subordinates, providing a comprehensive view of an employee's performance and interpersonal skills. • Behaviorally Anchored Rating Scales (BARS): Uses specific examples of behaviors for each performance level, making evaluations more objective and focused on concrete actions. • Self-Assessments: Allows employees to evaluate their own performance, promoting self-reflection and alignment with management's expectations. • Customer Feedback: Collects input from clients or patients regarding their experience and satisfaction, particularly relevant in a veterinary practice where client service is critical. These methods provide a well-rounded assessment of performance, enhance objectivity, and engage employees in the evaluation process, which is crucial for a small business like Meadow Hills. 3. Evaluate Brian Conrad’s approach to appraisal interviews. Write a paragraph or two summarizing what Conrad is doing well and how he might further improve the effort. Answer: Student answers here will vary. It is apparent Conrad is doing a great job and students should recognize the value in communicating with employees – not just on performance meeting days. Brian Conrad’s approach to performance appraisals at Meadow Hills is commendable for several reasons. First, involving employees fully in the process and providing evaluation forms in advance ensures transparency and allows staff to prepare meaningfully for their appraisals. Separating compensation discussions from performance feedback helps employees focus on their development without the stress of financial implications. Regular feedback throughout the year and the emphasis on positive reinforcement are also effective in maintaining motivation and addressing issues promptly. To further enhance this approach, Conrad might consider integrating more specific performance metrics and setting clear, actionable goals during the appraisal meetings. Additionally, incorporating a 360-degree feedback mechanism could provide a more comprehensive view of each employee’s performance and foster greater self-awareness and development. Regular training for managers on delivering constructive feedback and addressing performance issues could also improve the effectiveness of the appraisal process. Twitter Focus Performance management is an important activity at Meadow Hills Veterinary Center in Washington State. Each employee meets with the company’s practice manager and owners twice a year to discuss performance. The company tries to keep appraisal meetings positive by not waiting until meeting with employees to address performance problems. When employees don’t perform up to expectations, managers evaluate whether changes are needed in training or hiring. One result of this effective approach to performance management has reduced employee turnover rate from 25 percent to 10 percent. Question: How do the elements of time and timeliness factor into the success of Meadow Hills’ performance management? Answer: Time and timeliness are crucial to the success of Meadow Hills' performance management. Regular, biannual meetings ensure ongoing communication and timely feedback, preventing issues from escalating. Addressing performance problems promptly rather than waiting for appraisal meetings helps in making necessary adjustments in training or hiring. This proactive approach not only resolves issues efficiently but also contributes to higher employee satisfaction and reduced turnover by fostering a supportive and responsive work environment. Manager’s Hot Seat Exercise: Project Management: Steering the Committee-Please refer to the Asset Gallery on the OLC for Hot Seat videos and notes. I. Introduction Conflict among work groups is a common problem in organizations. This scenario depicts an organizational conflict and highlights different conflict management styles. A discussion of these styles and their effectiveness would be valuable for students in Management or Organizational Behavior courses studying organizational conflict. II. Learning Objectives 1. To assess students’ understanding of the sources of conflict and the conflict process. 2. To analyze and evaluate different conflict management styles. 3. To identify ways to ensure functional, rather than dysfunctional, conflict occurs. III. Scenario Description: Overview: Three months ago, Patrick was given goal of implementing a computerized tracking system on the factory floor with the expectations that it would raise quality control and workflow by a significant percentage. The team spends an enormous amount of time revising/fixing chips after they fail quality control testing – mostly due to lack of information. There would be a serious review of the project after the first phase is complete – that is now. Patrick is called to a meeting with three top executives. The tracking system project is very costly and has not been proven, although the company was gung-ho, because their competitors were using all sorts of computerized systems in their production facilities. Patrick has spent a little time writing a report, but is feeling generally confident. Profile: •Patrick Bennett is the Managing Supervisor of Production at TechBox, a desktop design software house, who oversees production and supervises a floor of 50 employees. •Morgan Baines is the Vice President of Distribution. He works at corporate headquarters and builds relationships with potential clients in expanding markets. •Lucinda Bergen is the Director of Product Management. She oversees all production at TechBox’s manufacturing factories. She works directly with the factory managers and reports to corporate headquarters. •Sam Adelson is the VP of Operations. His responsibilities include overseeing department managers at the manufacturing factories and corporate headquarters. He also acts as a liaison between his company and the officers of a number of high-end computer companies. References: The references included in the DVD are: •Sources of Conflict (PPT 9-3) •The Conflict Process (PPT 9-4) •Conflict Management Styles (PPT 9-7) •Structural Approaches to Conflict Management (PPT 9-9) Back History: TechBox produces a specialized computer chip for a large client base of high-end computer companies such as Dell, IBM, and Compaq. Within the TechBox compound are the manufacturing factories and the corporate headquarters. Patrick Bennett is the new hotshot manager overseeing the production of the main component of the chip. He has started to implement a computerized tracking system to increase quality control and workflow. He supervises a floor of 50 workers. Patrick has been working at TechBox for 2 years and has been widely praised for numerous successes and improvements on the factory floor – improvements with very positive financial results. He is young and motivated, possessing a unique comprehension of production/engineering knowledge and management sensibilities. He is greatly admired by his team and generally received well by top senior management. Sam Adelson has worked his way up from the mailroom. He does not embrace change and is skeptical of young hot shots and young people in general. He also does not embrace computerized system enhancements, which is odd for a man in high tech. In a nutshell, he’s stodgy, grumpy, and difficult. Lucinda Bergen is the only female executive at TechBox. She is generally compassionate, understanding, and easy going, but is quick to defend her position within the company and over assert herself when she feels confronted. She is very comfortable with young, talented people and has instituted many technological systems for workflow improvement within her own department. Morgan Baines is the class clown and jokester of the company. He speaks without thinking – supports, attacks, and withdraws without rhyme or reason. Everyone always has the impression that he’s on their side; the kind of guy who agrees with the last person who spoke. He’s been around very many years, successfully overseeing product distribution – between wisecracks. Scene Set-up: A meeting is held with key stakeholders of Patrick’s project to discuss the status of it in terms of time and budget. Scene Location: TechBox conference room The Meeting - Summary: Stakeholders in the project note their concern with the project going over budget and missing deadlines. Patrick, the project manager, defends himself and assures them that everything will work out because the longest phase of the project is complete. He cites his past track record and says the budget may go over just a little but it will be ok. The other team members say that going over budget is not an option. He concedes and says he will take a look at exactly how he can improve the progress of the project. They agree to meet again in a week for a status check. One Week Later - Patrick assures the group that they are now firmly under budget and plan to be done on time. Lucinda mentions that Frank, one of Patrick’s employees, said he thought the project was going to be late. Patrick defends himself by saying that Frank’s role would not allow him to be privy to all the information that Patrick knows and that he has this job for a reason – his talent and prior track record. Sam suggests supporting Patrick with an additional staff member. Patrick doesn’t think that would be necessary. Instead he suggests a daily email to the group updating the project in terms of budget and deadlines. They compromise by having the “1st deputy” be responsible for sending those daily emails and keeping track of all the relevant numbers. Afterthoughts – Summary: Patrick doesn’t think the meeting went very well. He says he didn’t feel listened to and was upset that the group was more persuaded by people indirectly involved in the project than by him. He felt he did ok and tried to work with them on an individual basis. In the second meeting, he said if he hadn’t stood his ground they would have “squished” him. Dossier: The specific artifacts included in the DVD are: 1. Bennett’s Progress Report 5/6/02 2. Bennett’s Progress Report 5/31/02 3. Voice message from Frank Jambey to Lucinda Bergen IV. Discussion Questions: The References and related Discussion Questions may be found in PowerPoint slides 9-1 to 9-10 on the instructor’s side of the text’s Website. Learning Objective #1: To assess students’ understanding of the sources of conflict and the conflict process. 1. What sources of conflict were present in this scenario? Refer to PPT 9-3 to construct your answer. Answer: Many sources of conflict come into to play here. Ambiguous rules may have been a source of conflict because Patrick didn’t seem to think that going over budget a little was going to be a big problem. He found out that that would be completely unacceptable which caused him to reevaluate his costs. Related to the budget – scarce resources may also be a factor contributing to this conflict. The other project members continually stress the need for the project to be on time and under budget. Communications are also contributing to this conflict because people were not actively listening to each other. Also, other communication channels (e.g., Frank) had an impact on the discussion and caused frustration for Patrick. 2. On PPT 9-4, The Conflict Process, overt behaviors are depicted as indicators of manifest conflict. What overt behaviors did you identify during this scenario? Answer: Lucinda repeatedly rolled her eyes and displayed negative affect towards Patrick. She was also very impatient and insulted Patrick by saying that interrupting him would get him off track. Patrick went on the defensive almost immediately. Adelson maintained composure but insinuated a lack of confidence in Patrick.  1. Patrick’s strategy should be to: A. Emphasize progress B. Defend himself C. Impress superiors Patrick should emphasize his progress in terms that the rest of the group will understand and be persuaded by. Defending himself based on his reputation will only go so far to influencing the group on this particular issue. Emphasizing his progress will impress his superiors. In actuality, Patrick defended himself based on his past reputation.  2. What does Sam Adelson insinuate about Patrick [when he calls him a hot- shot]? A. He’s arrogant B. He’s incompetent C. He’s inexperienced Adelson insinuates that Patrick is inexperienced, though apparently competent. The comment falls short of actually signifying confidence in Patrick.  3. How was this [first] meeting? A. A success B. A failure C. A good start Patrick thinks it was a failure because he did not feel supported or listened to. Learning Objective #2: To analyze and evaluate different conflict management styles. 1. Various conflict management styles are depicted on PPT 9-7. For each of the participants in the scenario, describe which style(s) they used and cite examples to support your answer. Answer: Lucinda – Competing – she doesn’t seem to want to listen to Patrick’s position or reasoning and puts roadblocks up to any suggestion that is not her own. Sam – Compromises – he tries to give Patrick more support which is initially rejected but then reinforces Patrick’s daily email idea with a person to perform that function Patrick – attempts Competing in that he rejects any suggestions for changing the current situation. He eventually attempts to compromise with the daily email idea. In the end he seems to accommodate to the rest of the group in accepting additional help. Morgan – Avoidance – he really stays out of any substantive discussion on this project.  4. How should Patrick respond [when Lucinda says “Frank says you will need an additional 3 weeks’]? A. Defame Frank B. Provide facts C. Admit fault Patrick indirectly defames Frank by saying he is in a lower-level position for a reason. A more persuasive technique would have been to provide facts to refute Frank’s claim. If Frank was correct, than Patrick should have admitted fault. Learning Objective #3: To identify ways to ensure functional, rather than dysfunctional, conflict occurs. 1. Review the Structural Approaches to Conflict Management (PPT 9-9). Several approaches to minimizing dysfunctional conflict are provided. Identify at least two specific actions taken by members of the group to minimize dysfunctional conflict. Answer: Clarify rules and procedures – Patrick suggests a daily email to keep the group posted on the project. This will minimize conflict by continually monitoring the situation so there are no surprises. Increase resources – Sam offered to provide Patrick with a #2 deputy to assist him in managing the project. 2. Choose two approaches (on PPT 9-9) and provide specific examples of what could have been done in this scenario to reduce dysfunctional conflict. Answer: The superordinate goals that all members share should have been discussed up front. This guides the discussion and ensures that information provided is maximally influential to other group members. Improve communication and understanding – group members should have tried to take the others’ perspectives. Many behaviors indicated that people were not actively listening and had pre-determined ideas on the best course of action and were not willing to change.  5. Confidence is low. Patrick should: A. Fight back B. Accept help C. Clarify position It’s unclear why Patrick is resistant to accept help other than to preserve his ego. Generally resources are difficult to acquire and he is being offered another staff person to help him. Ultimately he does accept the help but at first he refuses.  6. How should Patrick respond? A. Refuse offer B. Change approach C. Accept offer Once it is established that he will maintain control over the project, he agrees to the offer. Additional Activities Teaching Suggestions The topic of performance management is an excellent one for additional activities. Several cases are given that can be used as small group activities or that can be assigned to individual students or discussed in class. There are also some role-plays, a library assignment, a reading assignment, and an outside assignment. 1. Assign the following article: "Team Appraisals Team Approach" by Norman and Zawacki, Personnel Journal, September 1991, pp. 101¬104. Ask students to discuss the advantages and disadvantages of the team approach to performance management. 2. The following short cases can be used as written assignments, in class group cases, or role-plays. Case 1: Don Leslie (Raymond Noe, Michigan State University) Don Leslie, age 50, closed his eyes, propped his feet up on his desk, and contemplated his future with Wexler Foods. He could hardly believe that he had just completed his 23rd year marketing various Wexler products. Don entered the military service after college. After four years in the service, Don worked in retail sales and attended the evening M.B.A. program at the University of Minnesota. He joined Wexler after graduation. His first posi¬tion was in marketing research at corporate headquarters. He moved up to assistant brand manager and later to brand manager for a successful line of packaged dried fruits. Don's last promotion six years ago was to brand manager for Wexler's popular jams and jellies. The market share for the products had grown slowly but steadily while he was brand manager. Don was comfortable in his position and satisfied with his low six figure salary. This morning, Don learned that one of his colleagues, Carol Marshall, was promoted to marketing vice president. Don and several other brand managers were candidates for the position. It was clear that he had been passed over in favor of Carolyn. This was the second time that Don missed a promotion. Perhaps his career had reached a plateau with Wexler Foods. Don tried to picture how this would affect his career aspirations and motivation. Question 1. You are Don's manager. What do you propose to do with Don so that he will not become a motivation and performance problem? Answer: To address Don’s potential motivation and performance issues, I would first have a candid discussion to understand his career goals and concerns. Then, I would offer opportunities for new challenges, such as leading special projects or cross-functional teams, to reignite his enthusiasm. Additionally, I would provide targeted professional development and mentorship to prepare him for future advancement. Regular feedback and recognition of his contributions would also be crucial in maintaining his engagement and motivation. Case 2: Martina Jones (Raymond Noe, Michigan State University) Martina Jones works for 3M. She is 58 years old, but feels like she might as well be 68. She has had extensive management experience, including over¬seas experience. A couple of years ago, the division in which she worked had a major reorganization, and Martina ended up with less responsibility than she used to have. Her performance has not been a problem. Employees in other departments no longer call on her to share her exper¬tise. She realizes she's not likely to be promoted again before retirement. In a recent performance feedback session, Martina revealed to you that she is angry and frustrated. After all her years of service and the numerous contributions she's made, she feels like the company has let her down. Question 1. You are Martina's manager. What will you do to avoid having Martina become a motivation and performance problem? Answer: To address Martina’s frustration and prevent motivation and performance issues, I would first have a sincere discussion to understand her concerns and feelings. I would then work with her to identify new challenges or responsibilities that align with her experience and interests, possibly involving mentoring or leading special projects. Additionally, I would recognize her past contributions and explore opportunities for professional development to reignite her engagement. Ensuring she feels valued and involved in meaningful work can help improve her morale and motivation. Case 3: The Problem Employee (Raymond Noe, Michigan State University) One of the employees you manage has been working with the company for three years. The employee's performance has been average to below¬ average. You have consistently mentioned to the employee during perfor¬mance appraisals that you feel the employee lacks motivation and interest in the job, but it does not seem to have had much of an effect. Recently, the employee's performance has almost ruined three major projects. You had established two goals with the employee: (1) to complete a survey of customer needs within six months, and (2) to increase sales by 30 percent in one year. The employee has made little progress toward these goals during this appraisal period. Question 1. You are preparing once again to conduct a performance review with this employee. What will you do during the meeting to try to improve the employee's performance? Answer: During the performance review meeting, I would first clearly outline the specific issues with the employee’s recent performance and how it has impacted projects. I would then set up a collaborative discussion to understand any underlying issues affecting their motivation and performance. Next, I would create a detailed, actionable performance improvement plan with clear, measurable goals and deadlines, and offer additional support such as training or mentoring. Regular follow-ups and feedback sessions would be scheduled to monitor progress and provide continuous guidance, ensuring the employee understands expectations and has the tools needed to succeed. 3. Outside assignment: Have students interview a human resources manager about the performance appraisal system that he or she uses. Have the students give a short report to the class on their findings. 4. Library assignment: Have students write a research paper on MBO or BARS. There are numerous sources on both subjects. 5. An interesting article to assign to students on the subject of discrimination in performance appraisals is "Some Neglected Variables in Research on Discrimination in Appraisals" by Robert L. Dipboye, Academy of Management Review (1985) pp. 116 127. 6. The following are role plays dealing with defining the job expectations, giving positive feedback, improving poor performance, and taking disciplinary action. It is often useful to perform these role-plays in front of the class and get students to make comments or set up triads where one person is the observer and provides feedback to the players. Role-plays can also be videotaped and played back for feedback to the players. (The source for these role-plays is Patrick Wright, Cornell University.) Encourage students to change the names to be gender correct for the players. Defining the Job Role for James Haas Craig Teft is a new recruit who just joined your force today. He is coming in to meet with you before you assign him to his partner during his probationary period. You need to discuss with him exactly what your expectations are for his performance. This includes the fact that he will work with an experienced partner for six months, during which time you expect him to demonstrate his ability as a law enforcement officer. Also during this time, he will be working for substantially lower pay, which will be raised as soon as he is off probation. If he has not demonstrated this ability at the end of the six months, he can either be put on another three month probation or he can be terminated immediately. Role for Craig Teft You are about to meet with James Haas, the sergeant that you will work under for the next two years. You just graduated second in your class from the law enforcement academy. Because you demon¬strated far above average ability as a police officer, you simply do not feel that you will need to serve out the full six months of your probationary period. You feel that the lower pay you receive during this time is not exactly fair, since you will be paid the same as those who graduated far below you; thus, you would like to serve only three months on probation, rather than the required six. Giving Positive Feedback Role for James Haas You are about to meet with Mary Hill, an officer who has been with your department for just over a year. Over the weekend, she was at the local shopping mall with her husband and apprehended a purse-snatcher in the act while she was off duty. The elderly victim called you this morning to thank the department for having such a fine officer who would risk her safety when she was not on the job. She mentioned that she felt it was great to have female role models for some of the little girls that observed the arrest. This obviously will give the department a lot of positive public image. Role for Mary Hill You are about to meet with James Haas, your sergeant. You think that he's going to talk to you about what happened this weekend while you were shopping with your husband at the mall. You just happened to be walking towards an elderly woman about the time a juve¬nile snatched her purse. Before you even knew what happened, you had taken the juvenile down and were able to apprehend him. You really didn't think much of it because it all took place so fast Improving Poor Performance Role for James Haas You are about to meet with John McMahon, an officer who has been on the job for two years. In the last few months, there have been some reports that he was spending a large number of on duty hours in very nonproductive ways. His car is often seen in front of his home while on duty, and he's on a first name basis with the employees of every fast food joint in the town. In many ways, he has done an outstanding job (in terms of arrests, tickets, and meticulous paperwork), but you think that he can do a lot better if he spends a little more time working and a little less time in other somewhat nonwork activities. Role for John McMahon You have been working for the New Homestead Police Department for the last two years. You are going to meet with James Haas, your sergeant, in just a few minutes. You assume that he is probably going to commend you on the fine arrest you made last week. Your arrest record is much better than those of most of the other officers you work with, not to mention your excellent record for giving tickets. The arrests you have made and the tickets you have written all stand up in court, and that's more than can be said of a lot of your co¬workers. Because you've performed so well, you feel entitled to spend a little extra rest time on the job. You have a good rapport with a lot of the employees at the local fast food restaurants (it's good public relations), and occasionally you are able to slip home to see your family. Although you may do this more than some of the other officers, as long as you are more productive than they are, you don't really see the problem with this. Taking Disciplinary Action Role for James Haas You are preparing to meet with Peter Wemberly, an officer who has worked on your shift for three years. During this time, he has made quite a few very tough arrests, and there are few other officers that his peers would like to have back them up in violent situations. However, yesterday he pulled over a driver who he suspected was driving under the influence of alcohol. The driver refused a Breathalyzer test and became quite belligerent. It was not perfectly clear who actually threw the first punch (although most of the witnesses claim it was the officer). It is quite clear from the witnesses that he used more force than was apparently necessary to subdue the driver. The driver has filed a complaint with your department, claiming that he was physically assaulted by the officer. This is not the first time that a complaint has been filed against this officer, although the other two were dismissed. Your policy is that if there seems to be enough evidence to warrant an investigation, you can (but are not required to) suspend the officer without pay until the investigation is complete. After reviewing the matter, you think that it is in the best interest of the department to suspend him until the investigation has ended. Role for Peter Wemberly You are about to meet with James Haas regarding a complaint that was filed against you by some drunk driver. You had pulled the driver over yesterday, and he became quite belligerent. When he began to take a swing at you, you quickly reacted and subdued him quite forcefully. While it may have been more than was enough, you just never really know how much force is necessary with drunk drivers. You have had a few similar complaints against you in the past, but these have always been dismissed. You think you get more of these complaints than other officers because they always seem to send you out on the tough/violent calls. You know that although the policy is that you can be suspended without pay until the investigation is complete, this is not required. You don't think that you will be suspended this time because you feel that you were justified in your actions. 1. The article, "Six Strategies for Success in Measuring Performance" by R. Campbell and L. M. Garfinkel, HRMagazine, June 1996, pp. 98 104, makes the point that no one formula leads to the best performance management system. Companies with successful systems look at their business, how work gets done, and the important capabilities required of employees. Question 1. What are the costs and possible disadvantages of the six top rated approaches to performance management? Why wouldn't a company use these approaches? Answer: The top-rated performance management approaches, such as 360-degree feedback, Management by Objectives (MBO), Balanced Scorecard, Behaviorally Anchored Rating Scales (BARS), continuous feedback systems, and self-assessment, can be costly due to the need for extensive training, software, and time investments. Disadvantages include potential bias, complexity, and resistance to change. Companies might avoid these approaches due to high implementation costs, potential for inaccurate evaluations, and the requirement for ongoing commitment and cultural adjustments. HRM Failures Top Case 8: Using a Performance Review to Punish an Employee Deborah Lewis had been the bookkeeper for a school district for seven years when, in 2004, she asked her boss, the superintendent, for permission to work reduced hours and to occasionally work from home so that she could take care of her terminally ill mother. Although the superintendent granted permission, he later complained to the school board that the accommodation made for Lewis was an inconvenience. Furthermore, the superintendent claimed that Lewis had performance problems and that, if the district attempted to fire her, it could face liability under the Family and Medical Leave Act (FMLA). The school board subsequently assailed the FMLA as “ludicrous” and directed the superintendent to build a case against the bookkeeper. The following year, Lewis received a less-than-positive review and was told her performance over the past months (the period during which she worked reduced hours) was unsatisfactory. She was given the option of resigning or taking a demotion. Lewis sued the school district under the FMLA. When the court ruled in favor of the school district, she appealed. The U.S. Court of Appeals for the 7th Circuit reversed the decision, stating that Lewis’s protected conduct under the FMLA was a motivating factor for the demotion. The court also said the board recognized its obligations to an employee under the FMLA but chose not to inform Lewis of her rights, instead building a case against her in order to justify firing her. The FMLA gives employees certain rights. Employers cannot use a performance review as a tool for expressing their resentment when an employee exercises those rights under the law. Question Suppose you were the superintendent: What other options were available to you? Possible answers •When Ms. Lewis requested flexible work conditions, the superintendent and HR staff should have worked with her to outline the reduced schedule and discuss in detail how the work would get done if she couldn’t discharge all of her duties. •Either the superintendent or a representative from HR should have met/communicated regularly with Ms. Lewis to review how the reduced-hour arrangement was working out. If there were problems, they should have been addressed at their first occurrence. •While Ms. Lewis worked a reduced schedule, the superintendent could have considered temporarily reassigning some of the less-critical, less-technical tasks to existing staff or finding supplementary help, perhaps even on a volunteer basis As the superintendent, other options available to you could include: 1. Open Communication: Engage in transparent discussions with Lewis about her performance and any concerns, while providing support and flexibility within the bounds of her accommodation. 2. Performance Improvement Plan (PIP): Implement a formal performance improvement plan that outlines specific performance issues and provides a clear path for improvement, with regular check-ins and feedback. 3. Training and Resources: Offer additional training or resources to help Lewis improve her performance while she manages her caregiving responsibilities. 4. Temporary Reassignment: Consider reassigning her to a less critical role temporarily, with a clear plan for reassessment once her personal circumstances improve. 5. Documented Support: Document any performance issues objectively and ensure they are not influenced by her accommodation status, while providing her with information about her rights under the FMLA. Case: Lewis v. School District #70, 7th Cir., No. 06-4435 (4/17/08).
Source: James E. Hall, Mark T. Kobata and Marty Denis, “Retaliation for Job-Protected Absences,” Workforce Management, June 23, 2008, http://www.workforce.com. Solution Manual for Human Resource Management Raymond Noe, John Hollenbeck, Barry Gerhart, Patrick Wright 9780077164126