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Kaplan Financial 楷博财经教育 1 Copyright © Kaplan Financial www.kaplan-financial.com.cn What is performance appraisal?  Definition:  The regular and systematic review of performance and the assessment of potential with the aim of producing action programmes to develop both work and individuals.  Purpose  Aims to improve the efficiency of the organization by ensuring that the individual employees are performing to the best of their ability and developing their potential for improvement. Criteria to access staff performance  An effective appraisal system can be used to assess attitudes, behavior and performance but must have a balance of both measures of results and measures of activities. 1. Quantitative measures using some form of rating scale 2. Qualitative measures involving an unstructured narrative report on specific factors and overall levels of behavior and work performance. Note  A key issue in performance appraisal is determining what constitutes valid criteria or measures of effective performance.  All jobs have many dimensions so that performance appraisal must employ multiple criteria or measures of effectiveness Appraisal criteria Beer et al. Suggested Criteria for assessing performance  high commitment Kaplan Financial 楷博财经教育 2 Copyright © Kaplan Financial www.kaplan-financial.com.cn  The workforce is motivated and understanding, and is willing to interact with management about changes within the organization. Improved commitment may lead to more loyalty and better performance for the business.  high competence  The capacity of employees to learn new tasks and roles if the circumstances require it and the organization's ability to attract, keep, or develop employees who have valuable skills and knowledge  cost effectiveness  Can be evaluated in terms of wages, benefits, turnover, absenteeism, strikes, etc  higher congruence  The internal organization, the reward system, and the ‘input, throughput, and output’ of personnel, which need to be structured in the interests of all stakeholders What is performance appraisal?  An appraisal is a process by which the progress, performance, results and sometimes personality of an employee are reviewed and assessed by his or her immediate superior.  Requirements of employees • Must know not only what is expected of them • The reason for doing the job the way they do it, and how good/bad they are at their work.  Each person is appraised based on  The progress they have been making in their job  Their strengths and weaknesses  Their future needs as regards training and development  Their potential for promotion.  Relation of appraisal with organization control structure  Clarifies specific jobs relating them to the objectives of the organization  Develops realistic and appropriate performance standards  Assesses competencies  Uses feedback and reward to improve performance  Links performance to organizational goals.  Aim: TO make the behavior of employees predictable and, hence, controllable. Objective of performance appraisal (individual point of view)  Compares the individual’s performance against a set and established standard  Identifies work of particular merit done during the review period  Provides a basis for remuneration  Establishes what the individual has to do regarding the objectives of the organization  Determines the future employment of the individual, e.g. to remain in the same job, be transferred, promoted or retired early  Determines whether the individual is in a job where proper use is being made of his or her skills and talents Kaplan Financial 楷博财经教育 3 Copyright © Kaplan Financial www.kaplan-financial.com.cn  Establishes key results which the individual needs to achieve in work within a set period of time  Identifies training and development needs. Objective of performance appraisal (organization point of view)  Monitors human resource selection processes against results  Identifies candidates for promotion, early retirement, etc.  Helps to identify and provide a record of any special difficulties/hazards surrounding the job, perhaps not previously realized  Identifies areas for improvement  Provides a basis for human resource planning  Helps formulate the training plan  Improves communication between managers and the managed where the organization adopts the joint problem solving approach in their appraisal system Stages of performance appraisal  Based on job analysis, job requirements, performance standards and person specification  Assessing competence  Manager preparing an appraisal report  Manager interviewing the jobholder for an exchange of views about the appraisal report  Identifying and agreeing future goals and targets for improvement, solutions to problems  Manager’s own superior reviewing the assessment to establish the fairness of the procedure  agreeing, preparing and implementing action points, plans to achieve improvements, e.g. training needs  Follow up (giving results, monitoring progress of action plan, carrying out agreed actions on training, promotion and giving regular feedback. Stages of performance appraisal Kaplan Financial 楷博财经教育 4 Copyright © Kaplan Financial www.kaplan-financial.com.cn Types of staff appraisal  Review and comparison – consists of the individual being assessed and analyzed in terms of objectives, tasks, workflows and results achieved. These are then compared with previously agreed statements of required results and performance levels.  Management by objectives – managers agrees certain objectives with their subordinates and then review the results achieved. It is based on the idea that if subordinates know their objectives they are more likely to reach them.  The task-centered method – relates to what the subordinate is doing and how they do it. It avoids the more formal approach to staff appraisal and adopts a continual assessment approach. Management skills used in appraisal  Questioning  Listening  Persuading  Verbal communication. Skills required for interviewing  ‘Tell and sell’  The strategy of a salesperson trying to persuade and convince the subordinate  One way communication system  ‘Tell and listen’  Listens to the jobholder’s perception of the job and their problems, expectations and aims and does not dominate the interview.  Likely to be more effective  Joint ‘problem solving’  Represents a shift in emphasis from the first two methods. (encourage self assessment)  The skills are of a counselor using two-way Face-to-face communication. Benefits of appraisal – Employer vs. Employee Kaplan Financial 楷博财经教育 5 Copyright © Kaplan Financial www.kaplan-financial.com.cn Barriers to effective staff appraisal  Criticism had a negative effect on goal achievement  Subordinates generally reacted defensively to criticism during appraisal interviews  Inferior performance resulted from defensive reactions to criticism  Repeated criticism had the worst effect on subsequent performance of  Individuals who had little self-confidence. J Lockett suggested appraisal barriers  Appraisal as confrontation  Differing views regarding performance.  Feedback is subjective  Feedback is badly delivered.  Assessment is based on yesterday’s performance not on the whole year.  Disagreement over prospects and solutions.  Appraisal as judgment  Appraisal is seen as a one-sided process  Appraisal is imposed.  Appraisal as chat  Lack of will from either party.  An unproductive conversation.  No outcomes set.  Appraisal as bureaucracy  A traditional ceremony.  No purpose or worth.  Appraisal as an annual event  A traditional ceremony.  No purpose or worth. Kaplan Financial 楷博财经教育 6 Copyright © Kaplan Financial www.kaplan-financial.com.cn  Appraisal as unfinished business  Frustration at limited appraisal time.  No belief that issues will be followed up. How to overcome appraisal barriers?  A system of follow-up and feedback.  Agreements reached between the interviewer and the employee in the appraisal interview must be recorded  The agreed action plan should be reported to senior management and the HR department.  The interviewer is normally the manager of the employee. He or she should follow up the appraisal report and should arrange the training or development that has been agreed.  At the next appraisal interview, the interviewer and the employee should discuss whether the agreed training or development was provided, and what has been its effect. The need for assessing the appraisal system  Relevance  Useful and is it relevant to the needs of both the organization and the individual  Fairness  Reasonable objectivity and standardization of criteria throughout the organization.  Serious intent  Management committed to the system  Cooperation  Participative , problem solving  Efficiency  Expensive, difficult to administer and time consuming. 4P’s way of ensuring effective appraisal system  Firm  Managers should be willing to discuss negative as well as favorable aspects of performance.  Factual  Subjective aspects should be avoided.  Fair  All employees should be treated the same.  Frequent  Appraisals should be held on a regular basis rather than when a problem arises. Evaluating the effectiveness of appraisal system  Costs vs. benefits analysis of the appraisal process  Investigating improvements in performance by the individual and the organization  Collecting opinions from appraisers and appraisees  Monitoring performance results  Watching take up of training and development opportunities  Checking succession and promotion processes/results Kaplan Financial 楷博财经教育 7 Copyright © Kaplan Financial www.kaplan-financial.com.cn  Reviewing other factors such as staff turnover – a figure that is too high or too low is an indication that something is wrong in an organization.  Discharge – As a result of an employee’s unsuitability, disciplinary action or redundancy.  Unavoidable – because of marriage, moving house, illness or death.  Avoidable – due to pay, working conditions, relationships with work colleagues. Training, development and learning What is learning?  Definition:  The process of acquiring knowledge through experience, which leads to a change in behavior’. It includes the acquisition of a new skill, new knowledge, a modified attitude or a combination of all three.  Types  Formal learning: Undertaken deliberately when individuals consciously ‘learn’ and ‘study’. (class room based)  Informal learning : Usually intentional but not highly structured.( coaching, mentoring)  Incidental learning: A byproduct of some other activity, such as task accomplishment, interpersonal interaction, trial and error experimentation, learning from mistakes or even formal learning. What is learning curve?  The pace of learning or progress changes with familiarity – this is known as the learning curve.  Depends on • Type of work or task and • The individual. Training Process Kaplan Financial 楷博财经教育 8 Copyright © Kaplan Financial www.kaplan-financial.com.cn Why learning is important?  It can lead to increased competence, understanding, self-esteem and morale.  People who enjoy learning are more likely to be flexible in times of constant change and therefore are more adaptable to organizational turbulence.  There is growing evidence that a learning culture can increase the productivity and competitiveness of organizations.  If workers are not given learning opportunities, there is a risk that they will feel undervalued and become disenchanted. What is CPD?  Lifelong learning  Definition  The continuous maintenance, development and enhancement of the professional and personal knowledge, skills and ability, often termed competence, which members of certain professions require throughout their working lives’. What is a Learning organization?  One that facilitates the learning of all its members and continuously transforms itself.  They generate and transfer knowledge.  They learn from others and from past experience.  They tolerate risk and failure as learning opportunities.  They have a systematic, ongoing, collective and scientific approach to problem solving. Kolb’s experiential learning theory  David Kolb suggests that learning is a series of steps based on learning from experience. He suggested that classroom learning is false and that actual learning comes from real life experiences.  Comes from DOING and this ensures that learners actually solve problems.  To learn effectively from experience (which includes work placements and practical activities within taught courses) usually involves completing a cycle of activities. Four stages of the learning cycle Kaplan Financial 楷博财经教育 9 Copyright © Kaplan Financial www.kaplan-financial.com.cn Kolb Learning styles  Each learning style is a combination of two elements of the learning cycle. Kolb Learning styles  Accommodative  Feeling and doing – strong preference for concrete experiences and active experimentation (hands on).  Divergent -Feeling and watching  Preference for concrete experiences, but to reflect on these from different perspectives.  Assimilative-Thinking and watching  Prefers to swing between reflection and conceptualization and will use inductive reasoning to develop new theory.  Convergent – thinking and doing  Prefers to apply ideas, will take an idea and test it out in practice. Honey and Mumford- Learning styles  Based on Kolb’s sequence Kaplan Financial 楷博财经教育 10 Copyright © Kaplan Financial www.kaplan-financial.com.cn Honey and Mumford- Learning styles Implications of Kolb and Honey and Mumford’s theories  Most people exhibit clear strong preferences for a given learning style.  Tend to learn more effectively if learning is geared to their preference  Honey and Mumford designed a self description  Questionnaire so that people can discover their preferred learning style.  The scoring reveals the person’s strength of preference for each of the four learning styles.  It provides suggestions about the best ways for individuals to learn. Most effective learning methods  Activists  Have a practical approach to training, are flexible and optimistic. They prefer practical problems, enjoy participation and challenge, are easily bored and have a dislike of theory. They must have hands-on training.  Theorists Kaplan Financial 楷博财经教育 11 Copyright © Kaplan Financial www.kaplan-financial.com.cn  Require their learning to be programmed and structured; Designed to allow time for analysis; and provided by people who share the same preference for ideas and analysis.  Reflectors  Need an observational approach to training. They need to work at their own pace – slow, cautious and no participative – where conclusions are carefully thought out. They do not find learning easy especially if rushed.  Pragmatists  Need to see a direct value and link between training and real problems and aim to do things better. They enjoy learning new techniques and tasks and are good at finding improved ways of doing things. Education vs. Training vs. Development  Education ( HRD programs: For Future, can be fully evaluated when learners move to future jobs or tasks)  The activities which aim at developing the knowledge skills, moral values and understanding required in all aspects of life rather than a knowledge skill related to only a limited field of activity’.  Training (HRD programs: For present, effective and more efficient in day-to-day operations, can be fully evaluated after returning to work)  The planned and systematic modification of behavior through learning events, programmes and instruction which enable individuals to achieve the level of knowledge, skills and competence to carry out their work effectively’.  Development (HRD programs: To Lead, more general, more future and individual oriented, cannot always be fully evaluated)  The growth or realization of a person’s ability and potential through conscious or unconscious learning and educational experiences’ Note  Whether it is training, development or education, they all involve learning and the emphasis is on how the activity is organized  Is it systematic  A planned and  Deliberate approach. Benefits of training  Individual:  improved skills and (perhaps) qualifications  Increased confidence and job satisfaction.  Organization:  Motivated employees  Increased competence and confidence  Higher productivity  Skilled workforce Kaplan Financial 楷博财经教育 12 Copyright © Kaplan Financial www.kaplan-financial.com.cn  Low staff turnover  Improved health and safety  Higher quality performance  A more flexible workforce. Stages in training and development process 1. Identifying training needs ★ defining the learning required ★ setting training objectives 2. Planning the training 3. Delivering/ implementing the training 4. Evaluating training Identify training needs  Indicated by a job training analysis.  Job training analysis: It is the process of identifying the purpose of the job and its component parts, and specifying what must be learnt in order for there to be effective performance.  Training ‘gap’ or need: It is any shortfall in terms of employee knowledge, understanding, skill or attitudes against what is required by the job or the demands of organizational change. Methods used to identify training needs  Performance appraisal  Each employee’s work is measured against the performance standards or objectives established for their job  Training and development needs are considered in terms of future job performance as well as in terms of improving current performance.  Analysis of job requirements  The skills and knowledge specified in the appropriate job description are compared with data concerning jobs and activities  Organizational analysis  Uses data about the organization as a whole, e.g. its structure, markets, products or services, human resources requirements, etc.  The key success factors are identified and analyzed into HR activities.  Other methods  Surveys of staff with questionnaires  Interviews of superiors and subordinates  Customer surveys covering their satisfaction and dissatisfaction. Methods of training and development  Responsibility:  Training manager is responsible for determining, organizing, managing and directing training activities as well as acting in an advisory capacity.  Shared between personnel training specialists and departmental supervisors.  Training and development methods for individuals Kaplan Financial 楷博财经教育 13 Copyright © Kaplan Financial www.kaplan-financial.com.cn  Trai