ntroduction to Industrial and Organizational Psychology
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Work in the 21st Century
Chapter 5
Performance Measurement
Royalty-Free/CORBIS
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Module 5.1: Basic Concepts in Performance Measurement
Uses for performance information
Criterion data
Employee development
Motivation/satisfaction
Rewards
Promotion
Layoff
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Types of Performance Data
Objective
Personnel
Judgmental
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Performance Measurement (cont'd)
Relationships among performance measures
Hands-on performance measures
Employee engages in work-related tasks
Include carefully constructed simulations
Walk-through testing
Employee describes in detail how to do a job
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Performance Measurement (cont'd)
Electronic performance monitoring
Attaining positive employee feedback
Improving performance
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Performance Management
Emphasizes link between individual behavior & organizational strategies & goals
3 Components of Performance Management
Definition of performance
Actual measurement process
Communication between supervisor & subordinate about individual behavior & organ. expectations
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Perceptions of Fairness in
Performance Measurement
Factors associated with fairness measurement
Appraisal frequency “+” related to fairness perceptions
Joint planning with supervisor to eliminate weaknesses enhances fairness perception
Supervisor’s knowledge of duties of person being measured
Supervisor’s knowledge of actual performance of person being rated
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Perceptions of Fairness in
Performance Measurement (cont'd)
Distributive justice
Fairness of outcomes related to decisions
Procedural justice
Fairness of process by which ratings are assigned & a decision is made
Interpersonal justice
Respectfulness & personal tone of communications surrounding evaluation
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Module 5.2: Performance Rating—Substance
Theories of performance rating
Process model
Addresses various factors comprising rating process
Content model
Addresses content input to supervisory ratings
Rating context
Includes both announced purpose & other, non-announced agendas surrounding ratings
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Figure 5.1: A Process Model
of Performance Rating
SOURCE: Landy & Farr (1980).
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Focus on Performance Ratings
Overall performance ratings
Influenced by 3 factors
Task performance
Contextual performance
Counter-productive performance
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Performance Ratings (cont'd)
Trait ratings – a warning
Task-based ratings
Effectiveness of employee
in accomplishing duties
Most easily defended in court
Critical incidents method
Examples of critical behaviors that influence performance
PhotoLink/Getty Images
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Performance Ratings (cont'd)
Structural characteristics of performance rating scale
Extent to which duty/characteristic being rated is behaviorally defined
Extent to which meaning of response categories is defined
Degree that person interpreting ratings can understand response that rater intended
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Rating Formats
Graphic rating scales (most common)
Graphically display performance scores running from high to low
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Figure 5.2: A Variety of
Graphic Rating Scales
Table 5.3: Evaluating the Rating Formats in Figure 5.2
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Table 5.4: A Weighted Checklist for a College Instructor
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Rating Formats (cont'd)
Checklist
List of behaviors presented to rater who places a check next to items that best (or least) describe the ratee
Weighted checklist
Included items have assigned values or weights
Forced-Choice Format
Requires the rater to choose two statements out of four that could describe the ratee
Table 5.5: An Example of a
Forced-Choice Format
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Figure 5.3: BARS
(Ventilation) for Firefighters
Behaviorally anchored rating scales (BARS)
Rating format that includes behavioral anchors describing what worker has done, or might be expected to do, in a particular duty area
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Employee Comparison Methods
Involve direct comparison of 1 person w/another
Simple ranking
Employees ranked from top to bottom according to assessed proficiency
Paired comparison
Each employee in a group is compared with each other individual in the group
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Employee Comparison Methods (cont’d)
Useful in making layoff or downsizing decisions
Feedback is difficult because there is no clear standard of performance
Difficulty in comparing individuals in different groups
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Module 5.3: Performance Rating—Process
Rating sources
Supervisors
Most common
information source
Many actively avoid
evaluation & feedback
Ryan McVay/Getty Images
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Rating Sources (cont'd)
Peers
More likely to know about a worker’s typical performance
Conflict of interest likely when competing for fixed resources
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Self-Ratings
Discussion of ratings with supervisor increases perceptions of procedural fairness
Potential for distortion & inaccuracy
Minimized with supervisor discussion
Conflict of interest if used for administrative purposes
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Rating Sources
Subordinate ratings
Critical that subordinate feedback be kept anonymous
Customer & supplier ratings
Important from business strategy vantage point
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Rating Sources
360 degree systems
Collect & provide an employee with feedback that comes from many sources
Often used for feedback & employee development
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Figure 5.4: Potential Sources for
360 Degree Feedback
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Rating Distortions
Central tendency error
Raters choose mid-point on scale to describe performance when more extreme point is more appropriate
Leniency-severity error
Raters are unusually easy or harsh in their ratings
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Rating Distortions (cont'd)
Halo error
Same rating is assigned to an individual on a series of dimensions, causing the ratings all to be similar; lack of identification of strengths and weaknesses
A “halo” surrounds the ratings
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Rater Training
Some distortions (errors) may be corrected through training
Administrative training
Important for uncommon rating systems (e.g., BARS) or if 1 or more structural characteristics are deficient
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Rater Training (cont'd)
Psychometric training
Makes raters aware of common rating errors in hopes of reducing such errors
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Frame of Reference Training
Based on assumption that rater needs context for providing rating
Basic steps
Provide information about multidimensional nature of performance
Ensure raters understand meaning of scale anchors
Engage in practice rating exercises of standard performance
Provide feedback on practice exercise
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Reliability & Validity of
Performance Ratings
Reliability
Currently the subject of lively debate
Inter-rater reliability considered poor but this isn’t necessarily bad considering each rater relies on a different perspective
Validity
Depends on manner by which rating scales were conceived & developed
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Module 5.4: Social & Legal
Context of Performance Evaluation
Motivation to rate
Suggestion that raters use process as a means to an end, either personal or organizational
Performance appraisal as a goal-directed activity with 3 stakeholders
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Motivation to Rate (cont'd)
Rater goals
Task performance
Interpersonal
Strategic
Internalized
Ratee goals
Information gathering
Information dissemination
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Motivation to Rate (cont'd)
Organizational goals
Between-person uses
Within-person uses
Systems-maintenance uses
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Goal Conflict
When single system is used to satisfy multiple goals from different stakeholders, rater must choose which goal to satisfy before assigning a rating
Possible solutions
Use multiple performance evaluation systems
Obtain involvement of stakeholders in developing the system
Reward supervisors for accurate ratings
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Performance Feedback
Problematic when same information is used for multiple purposes
Feedback (especially negative) should be stretched over several sessions
“Praise-criticism-praise sandwich”
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Performance Feedback (cont’d)
Employee more likely to accept negative feedback if he/she believes:
Supervisor has sufficient “sample” of subordinate’s actual behavior
Supervisor & subordinate agree on subordinate’s job duties
Supervisor & subordinate agree on definition of good & poor performance
Supervisor focuses on ways to improve performance
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“Destructive” Criticism
Feedback that is cruel, sarcastic, & offensive
Usually general rather than specific
Often directed toward personal characteristics of employee
Leads to anger, tension, & resentment on part of employee
Apology best to repair damage of such criticism
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Implementing 360 Degree Feedback
Ensure anonymity of sources
Rater & ratee should jointly identify the evaluator
Use for developmental & growth purposes
Train information sources & those giving feedback
Follow up feedback session with regular opportunities for progress assessment
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Performance Evaluation & Culture
Hofstede’s 5 dimensions of culture might affect performance evaluations
Modesty bias
When raters give themselves lower ratings than warranted
Prevalent in cultures with high power distance
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Performance Evaluation & the Law
Ford Motor Company & its forced distribution rating system
Evaluators were required to place managers into performance categories based on predetermined percentages
Ford sued by managers & eventually paid over $10 million to litigants
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Performance Evaluation &
the Law (cont'd)
Review of court cases from 1980-1995
Judges primarily concerned with issues of fairness rather than technical characteristics of the system
C. Sherburne/PhotoLink/Getty Images
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Table 5.6: Recommendations regarding substance of appraisal criteria
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Performance Evaluation
& the Law (cont’d)
Lawsuits most often brought against trait-based systems
Arguments
Ratings unduly subjective & decisions based on those ratings are unreliable or invalid
Ratings have no basis in actual behavior due to subjectivity
Little evidence of such unfairness has been found
Research suggests performance evaluations do not systematically discriminate against protected subgroups
Table 5.7: Procedural Recommendations for Legally Sound Performance Appraisals
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