Psychology 245

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Psychology 245

• Evaluating Employee Performance
• Chapter 5
• missing latter half!

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Performance appraisals

• Systematic review and evaluation of employees
  job performance and the delivery of performance
  feedback.
• Use of performance appraisals
• Personnel decisions promoting, firing
• Developmental purposes identify strengths,
  weaknesses.
• Documentation provide line of legal defense
  against lawsuits.

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Performance Appraisal Implications
Make criterion deficiency errors

• Poorly designed systems result in very negative
  consequences
• Wrong people get promoted or fired
• Employees feel treated unfairly and behave
  accordingly
• Outcomes include low motivation, low commitments
  to the org, counterproductive behaviors, job
  dissatisfaction, etc.

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I/O and Performance Appraisal (PA)

• I/O psychologists especially well-suited to be
  involved in PA because of training
• Measurement expertise
• HR knowledge
• Organizational psychology
• Performance management process of individual
  performance improvement includes
• Goal setting, coaching/feedback, PA, and
  developmental planning.

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Contextual Approach

• PA is a social-psychological process.
• Communication occurs within this social context.
• Used to believe that accuracy was the primary
  goal of performance appraisal thus research on
  formats and errors.
• Now, we realize that the social context makes PA
  a complex process of which accuracy is just one
  part.

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Supervisor Ratings

• Supervisor Ratings
• Most common type of appraisal.
• Supervisors are
• Knowledgeable about the job, can provide
  reinforcements, and suggestions for improvement.
• Supervisory ratings have higher reliability than
  any other type ratings of performance.

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Peer Appraisals

• Correlate well with supervisor ratings.
• Both supervisors and peers can directly observe
  incumbent at work.
• Problem with peer appraisals
• Potential for conflict among employees evaluating
  each other.

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Self Appraisals

• Correlate slightly with supervisor ratings.
• More lenient than supervisor ratings.
• Focus more on effort than on performance.
• But can be useful in encouraging subordinates to
  be more committed to performance goals.
• Modesty bias
• Chinese workers give themselves lower ratings
  than do their supervisors.

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Subordinate Appraisals

• Used to evaluate effectiveness of managers and
  supervisors.
• High correlation between subordinate and
  supervisor ratings of manager employees.
• Supervisor attitudes toward subordinate ratings
• Positive when used in conjunction with supervisor
  ratings, but less so when provided alone.
• Employee wants promotion to not only be based on
  subordinates

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Rating Formats Overview

• Various ways to conduct appraisals
• 1. Graphic Rating Scales
• 2. Behaviorally Anchored Rating Scales (BARS)
• 3. Checklists
• 4. Employee Comparison Procedures

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Methods of rating performance

• Graphic Rating Scales
• Scales consisting of a number of traits or
  behaviors that the rater must judge based on
  where the employee falls on this dimension
  regarding expectations.
• Egs. Conscientiousness, knowledge, creativity.

Meets expectations
Exceeds expectations
Below expectations
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BARS

• Behaviorally Anchored Rating Scales
• Five steps in the development
• Identification of important performance
  dimensions.
• Generation of behavioral examples (critical
  incidents) at all levels of effectiveness.
• Retranslation of CIs back into dimensions.
• Rating of each CI on effectiveness.
• Choose items with behavioral anchors.
• Strength and Weakness very elaborate so takes
  much time and money to create.

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Behaviorally Anchored Rating Scale for Problem
Solving
1 Poor Performance
Focuses only on a single problem
Does not consider the implications of a course of
action
Is able to suggest one solution for each key
issue identified and outline its potential
benefits and drawbacks
Develops two or more courses of action for two of
the key issues presented and is able to identify
potential pros and cons of each.
9 Good Performance
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Checklists

• Read large number of behavioral statements and
  check if individual exhibits each behavior.
• Weighted Checklist
• Variant of checklist in which items are rated by
  importance.

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Weighted checklists
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Employee Comparison Procedures

• Involves comparing employees to each other.
• Rank ordering
• Raters rank employees from best to worst
• Paired comparisons
• Raters compare employees to every other employee
• Forced distribution
• Raters designate a proportion of ratees into each
  of 5 or 7 categories.
• Eg must classify 1/3 of employees as average,
  1/3 as below average, and 1/3 as above average.

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Advantages/Disadvantages of Rating Formats

• Easy to develop use.
• Precise and well defined scales.
• Well-received by raters ratees.
• Easy to develop use.
• Precise rankings are possible.
• Useful for making administrative rewards on a
  limited basis.

• Lack of precision in dimensions anchors. (What
  makes one different)
• Time money intensive.
• No evidence that BARS are more accurate.
• Rater errors are frequent.
• Time intensive.
• Not well-received by raters.

Graphic Rating Scale BARS Checklists Employee
Comp. Methods
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Rating Errors Overview

• Errors emerge largely because of the limits of
  cognitive processing.
• Different types of errors
• 1. Halo
• Distributional Actual rating distributions do
  not match the rating distributions.
• 1. leniency
• 2. Central Tendency
• 3. severity

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Cognitive Process Model of PA problems that may
arise

• Five step cognitive process of PA judgments for
  evaluator (supervisor)
• Observe behavior
• May miss important behaviors.
• Encode information
• May label information incorrectly.
• Store information
• May store wrong information.
• Retrieve information
• May retrieve irrelevant information.
• Integrate information
• May let personal liking affect intregration of
  information.

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Ratings Errors

• Halo
• Rating error that results from
• 1. Tendency to use a _____ evaluation as a basis
  for making individual evaluations.
• 2. Unwillingness to _____ between dimensions of
  a ratees performance.
• Not all halo is error!
• _____ _____
• Some individuals are high in all dimensions.

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Distributional Errors

• Errors that result from a discrepancy between the
  _____ rating distribution and the _____ rating
  distribution.
• Performance should be _____ distributed.
• Most folks fall somewhere in the middle few
  really bad and really good performers.
• If actual rating distribution is different from
  the normal distribution, it implies some type of
  error.

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Leniency

• Raters are lenient if
• Mean of one raters ratings is _____ than mean of
  all raters ratings across all ratees.
• Why be lenient?
• Raters like ratees.
• Raters want to be liked by ratees.
• Keep peace in the workplace.
• IM for supervisors.

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Central Tendency

• Raters use only the _____ of the scale in rating
  their employees.
• Why?
• Raters dont have much experience with
  subordinates so they default with high marks.
• Raters may be lazy.
• Raters afraid of discriminating among employees.

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Severity

• Trend to use only _____ end of the scale when
  rating employee performance.
• Why?
• _____ employees.
• _____ employees.
• Provide _____ for improvement.
• Maintain impression of being ________.

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Problems with Distributional Errors

• Ratings do not adequately discriminate between
  effective and ineffective employees.
• Range restriction
• If used for personnel decisions, will not provide
  adequate and needed information.
• Of course, Distributional Errors could be of the
  True variety.

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Other rating errors

• _____ effect
• The tendency to heavily weight _____ performance
  when providing ratings, and to ignore earlier
  information.
• _____ effect
• The tendency to heavily weight _____ impressions
  when providing ratings, to ignore later
  information.
• _____ to _____ effect
• Tendency to provide higher ratings to ratees who
  are similar to you.

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So, can training improve rater accuracy?

• Not necessarily!
• Rater Error Training (RET)
• Type of training designed to reduce the incidence
  of rater errors (such as halo).
• Training about halo might _____ accuracy!
• True halo
• Frame of Reference (FOR) Training
• Type of training in which raters come to share a
  common mindset before providing ratings.
• Goal is make sure a score of 5 means the same
  thing across raters.

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The Social-Psychological Context

• Factors such as the social, legal, and
  organizational cultures affect PA.
• Looking at PA from the ________ _____.
• Get away from the industrial psych roots and
  broaden our look at PA.

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Reactions Criteria

• Rater and ratee reactions to the performance
  appraisal process are important.
• Reactions may be a better indicator of viability
  of the PA system than psychometric indices.
• Both appraisal characteristics and organizational
  factors impact Appraisal Satisfaction etc.
• Reactions include satisfaction, perceived
  accuracy, motivation to use feedback, etc.
• What are the implications for organizations?

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Supervisor-Subordinate Relationship

• _______ - _____ _____ (LMX) Supervisors have
  different relationships with different
  subordinates.
• These relationships can affect the performance
  appraisal process.
• Employees with a favorable LMX have been rated
  higher than their counterparts regardless of
  objective performance.
• Implications??

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Organizational Politics

• Organizations are political entities
• Politics plays a role in appraisal.
• Subordinates use impression management
  strategies.
• Supervisors manage impressions too!
• Implications??

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Trust

• Extent to which raters believe that fair and
  accurate appraisals have and will be made in
  their organization.
• Relates to employee acceptance of and trust in
  management.
• If the process is trusted, it will be utilized
  more effectively.
• PA can be a tool to enhance orgl trust.
• Implications??

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Multi-Source Feedback (360)

• Involves the use of ratings by
• Consistent with the participative empowered orgs
  of the 21st century.
• Prevalent for development, but increasing for
  personnel decisions too.

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Multi-Source Feedback (360)

• Three assumptions for 360 to work
• Using multiple sources overcomes individual rater
  idiosyncrasies.
• Involvement in process makes participants _____.
• Multiple raters bring _____ viewpoints about the
  ratee, which are valuable.

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How to Implement a 360 Program

• Be honest about how ratings will be used.
• Help employees interpret and deal with ratings.
• Do not present too much information
• Train raters (including self-raters).

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Performance Appraisal Process

• Composed of performance rating and performance
  feedback.
• Performance feedback
• Process of giving information to employees about
  their performance level with suggestions on how
  to improve.
• Appraisal process is effective if
• Feedback is __________, not evaluative.
• Ratee can __________ in the appraisal process.
• Feedback is __________.

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Performance Appraisal and the Law

• Cannot discriminate in the U.S. on basis of
  non-performance related factors (age, gender,
  race, ethnicity, disability, religion).
• Eight legal Recommendations for Performance
  Appraisal

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Legal Issues in Performance Appraisal

• Recommendations for effective appraisals
• Develop _____ for a sound job analysis.
• Communicate _____ to employees in _____.
• Evaluate performance on _____ dimensions.
• Use objective and subjective judgments.
• Give employees an _____ mechanism.
• Use _____ raters!
• Document everything relevant to personnel
  decisions.
• _____ raters, or give them instructions on
  conducting the performance appraisal.

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Evidence for Utility of Legal Recommendations

• Werner and Bolino (1997) reviewed court decisions
  and found judgments for defendants when
• A _____ __________ is used.
• Written instructions are _____.
• Employees can _____ their appraisals.
• Multiple raters _____ on ratings.
• Rater _____ is used.
• Format __________ seem to matter at all to the
  judges.