Performance Management and Motivation Chapter 12

Chapter 12: Performance Management and Motivation

• Performance is more than just effort; it encompasses results, team achievements, and organizational outcomes/cost savings
• Performance Management is a continuous process
  • Identifying individual and team performance
  • Measuring individual and team performance
  • Developing individual and team performance
  • Aligning performance with organizational goals
• Performance Management (PM) isn't just performance appraisal
  • Considers strategic business factors
  • Involves ongoing feedback allowing continuous employee improvement
  • Driven by line managers
• Performance appraisal is a yearly assessment of strengths/weaknesses
  • Lacks ongoing feedback and is driven by HR
• Contributions of PM to employees
  • Clarifies job and success definitions
  • Increases motivation and self-esteem
  • Develops self-insight
• Contributions of PM to managers
  • Improves communication of performance views
  • Provides insight into subordinate performance
  • Helps differentiate strong vs weak performers
• Contributions of PM to organizations/HR
  • Clarifies organizational goals
  • Facilitates organizational change
  • Improves fairness and appropriateness of administrative actions
  • Prevents lawsuits

Performance Management in Practice

• Performance management helps organizations meet goals
  • Monitors and guides employee performance to reach organizational goals
  • Includes job assignments, goal setting, standards, feedback, and appraisal
• Key Components of Performance Management
  • Job assignment
  • Goal setting (SMART goals)
  • Performance standards
  • Feedback
  • Performance appraisal
  • Outcome distribution (rewards/punishments)

Work Assignment

• Staffing
• Person-organization and person-job fit
• Implications for training

Goal Setting

• Clear, unambiguous, specific
• Measurable, attainable, relevant, realistic
• Time-bound

Establishing Performance Standards

• How individual performance will be judged
• Measurement considerations

Performance Appraisal

• Formal evaluation of employee performance against their objectives
• Should be fair and objective

Performance Appraisal - Key considerations

• Evaluation process
• Scheduling of evaluation
• Appraiser (single or multi-source feedback - like 360 degree feedback)
• Evaluation methods (traits, behaviors, outcomes)

Distributing Outcomes

• Employment as an exchange relationship
• Fair rewards for high performance
• Individual and team rewards

Performance Management and Employee Motivation

• Supervisor-subordinate relationship is crucial
• Managers need training to avoid bias and create a productive environment
• Performance management differs in different parts of the world
  • Example: US focus may be on individual performance evaluation versus longer-term potential evaluation as may be seen in Japan
  • Performance Management systems need to adapt to different cultural contexts for maximum impact

Disadvantages of Poorly Implemented PM Systems

• Employees:* Lowered self-esteem, burnout, damaged relationships, false/misleading information
• Managers:* Increased turnover, decreased motivation, unwarranted resource demands, unfair or varying standards
• Organizations:* Wasted time\money, unclear rating systems, emerging biases, higher litigation risks.

Integration with other Human Resources and Development (HRD) Activities

• Performance management supports training, workforce planning, recruitment, and compensation decisions to support organizational needs.

Explore the concepts of performance management and motivation in this comprehensive quiz. Learn about the continuous process of measuring and developing performance at individual and team levels, as well as the key differences between performance management and performance appraisal. Delve into how these processes align with organizational goals and contribute to employee and managerial growth.