(Mt) – Implications for Performance Management Case Study Paper

Chapter 9 Performance Management Skills H I G G A leader becomes complete only after giving something back. S —LAURENCE S. LYONS , A By the end of this chapter, you will be able Nto do the following: Understand that managers need several key skills to manage the performance of G their employees effectively, including skills regarding coaching, giving feedback, E and conducting performance review meetings. Understand four guidelines that provide a framework for successful coaching L including the importance of a good coaching relationship, the central role of the A employee as the source and director of change, understanding employees as unique LEARNING OBJECTIVES and whole, and realizing that the coach is the facilitator of the employee’s growth. Define coaching, and describe its major functions, including giving advice, providing 1 guidance and support, and enhancing employee confidence and competence. 1 Identify behaviors that managers need to display to perform the various coaching 0 functions. Understand that a manager’s personality 8 and behavioral preferences determine his or her coaching style. T Understand your own coaching style and the need to adapt your coaching style to S the situation and your subordinates’ preferences. Describe the coaching process and its components including setting developmental goals, identifying developmental resources and strategies, implementing strategies, observing and documenting developmental behavior, and giving feedback. Understand the time, situational, and activity constraints involved in observing and documenting an employee’s progress toward the achievement of developmental goals and good performance in general. 226 Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills Implement a communication plan and training programs that will minimize the impact of constraints present when observing and documenting performance. Describe the benefits of accurate documentation of an employee’s developmental activities and performance. Implement several recommendations that will lead to documenting performance in a useful and constructive manner. Understand the purposes served by feedback on performance regarding the achievement of developmental goals and performance in general. Implement several recommendations that will lead to creating useful and constructive feedback systems. H Understand why people do not feel comfortable giving negative feedback, and I recognize what happens when managers refuse to give negative feedback. G if an employee does not overcome Implement a disciplinary or termination process performance problems over time. G Understand the various purposes served by Sperformance review meetings and the various types of meetings that can be conducted. , Understand the signs of employee defensiveness, implement suggestions to minimize employee defensiveness before a performance review meeting takes place, and deal with defensiveness during the performance review meeting. A Chapter 8 addressed issues about employee N development. Specifically, Chapter 8 discussed how to use a performance management system to help employees develop G more long-term career goals and and improve their performance and to address aspirations. Performance management systems E are not likely to help employees develop and improve their performance if managers do not have the necessary skills to L skills include being able to serve as help employees accomplish these goals. Such coaches, to observe and document performance A accurately, to give both positive and negative feedback, and to conduct useful and constructive performance review discussions. Unfortunately, these skills seem to be in short supply; hence, this chapter addresses each of these topics. For example, a1survey conducted by the consulting firm Watson Wyatt found that, in about 50% of the organizations included in the study, 1 underperforming employees improve managers are only slightly effective in helping 1 their performance. This lack of supervisory0skills is not unique to the United States. For example, a study including more than 100 organizations in Barbados found that, 8 overall, employees are not satisfied with their performance management system and Tthe process” and “low levels of supervisome of the culprits are “poor management of sory motivation.”2 Let’s begin with the first of these issues: coaching. S 9.1 COACHING Coaching is a collaborative, ongoing process in which the manager interacts with his or her employees and takes an active role and interest in their performance.3 In general, coaching involves directing, motivating, and rewarding employee behavior. Coaching is a day-to-day function that involves observing performance, complimenting good work, and helping to correct and improve any performance that does not Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 227 228 Part III • Employee Development meet expectations and standards. Coaching is also concerned with long-term performance and involves ensuring that the developmental plan is being achieved. Being a coach thus is similar to serving as a consultant and, for coaching to be successful, a coach must establish a helping relationship.4 Establishing this helping and trusting relationship is particularly important when the supervisor and subordinate do not share similar cultural backgrounds, as is often the case with expatriates or when implementing global performance management systems.5 In such situations, a helping and trusting relationship allows for what is labeled cultural transvergence in performance management, which means that cultural differences are discussed openly, and alternate practices, which enhance individual and team performance, are implemented. H Coaching is a pervasive organizational activity and, since the mid-1990s, there I Specifically, the first scholarly article on has been an explosion of interest in coaching. coaching was published in 1955, and between G then and December 2005, 393 articles have been published on the topic.6 Increased interest in recent years is evidenced by Ghave been published since 1996. Although the fact that, of the total of 393 articles, 318 many theories on coaching exist, there areS four guiding principles that provide a good framework for understanding successful coaching:7 , 1. A good coaching relationship is essential. For coaching to work, it is imperative that the relationship between the coach and the employee be trusting and collaborative. As noted by Farr and Jacobs,Athe “collective trust” of all stakeholders in the process is necessary.8 To achieve N this type of relationship, first the coach must listen in order to understand. In other words, the coach needs to try to G the job and organization from his or her walk in the employee’s shoes and view perspective. Second, the coach needs E to search for positive aspects of the employee because this is likely to lead to a better understanding and acceptance L of the employee. Third, the coach needs to understand that coaching is not A done with the employee. Overall, the something done to the employee but manager needs to coach with empathy and compassion. Such compassionate coaching will help develop a good relationship with the employee. In addition, 1 for the coach. This type of compassionate there is an important personal benefit coaching has the potential to serve 1 as an antidote to the chronic stress experienced by many managers.9 It has been argued that this type of coaching can 0 of compassion elicits responses within ameliorate stress because the experience the human body that arouse the parasympathetic nervous system (PSNS), which 8 can help mitigate stress. 2. The employee is the source and director T of change. The coach must understand that the employee is the source of change S and self-growth. After all, the purpose of coaching is to change employee behavior and set a direction for what the employee will do differently in the future.10 This type of change will not happen if the employee is not in the driver’s seat. Accordingly, the coach needs to facilitate the employee’s setting the agenda, goals, and direction. 3. The employee is whole and unique. The coach must understand that each employee is a unique individual with several job-related and job-unrelated identities (e.g., computer network specialist, father, skier) and a unique personal history. The coach must try to create a whole, complete, and rich picture of the Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills employee. It will be beneficial if the coach has knowledge of the employee’s life and can help the employee connect his life and work experiences in meaningful ways. 4. The coach is the facilitator of the employee’s growth. The coach’s main role is one of facilitation. A coach must direct the process and help with the content (e.g., of a developmental plan) but not take control of these issues. The coach needs to maintain an attitude of exploration; help expand the employee’s awareness of strengths, resources, and challenges; and facilitate goal setting. In more specific terms, coaching involves the following functions:11 • Giving advice to help employees improve H their performance. In other words, coaching involves not only describing what needs to be done but also how things need to be done. Coaching is concernedIwith both results and behaviors. • Providing employees with guidance so that G employees can develop their skills and knowledge appropriately. Coaching involves providing information both about G to do the work correctly and informathe skills and knowledge that are required tion about how the employee can acquire S these skills and knowledge. • Providing employees support and being there only when the manager is needed. , Coaching involves being there when the employee needs help, but it also involves not monitoring and controlling an employee’s every move. In the end, coaching is A N BOX 9.1 G Taking Coaching Seriously at Becton, E Dickinson, and Company A coaching culture and leadership development are L viewed as competitive strengths at Becton, Dickinson, and Company (BD, http://www.bd.com). The U.S.-based company manufactures and sells A medical supplies, devices, laboratory instruments, antibodies, reagents, and diagnostic products to health-care organizations, clinical laboratories, private industry, and the public. The coaching culture at BD includes the following points, as noted by Joseph Toto, the company’s director of leadership development and learning: 1 1. We place high expectations on corporate leaders 1 to model coaching as a productive and effective way to improve performance. 2. We expect leaders at all management levels 0 to be coached as well as to coach the development of others. 8 3. We establish coaching as a norm. Leaders must view coaching and development as some of T roles. the key responsibilities and deliverables in their Part of the company’s training program includes S developing skills through peer coaching and building management skills through peer interaction, support, and guidance. The training sessions emphasize several skills, including listening, asking facilitating and open-ended questions, sharing experiences, and challenging assumptions or discussing actions that might not be productive in the view of the coach. Training also involves self-assessment of strengths and weaknesses and identifying behaviors that would assist leaders in any given circumstance in which they might find themselves as managers in the company. In summary, BD has utilized training programs to develop and reinforce a coaching culture. This culture is credited with developing leaders to provide direction to others in a constantly changing business environment.12 Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 229 230 Part III • Employee Development about facilitation. The responsibility for improving performance ultimately rests on the shoulders of the employee. • Giving employees confidence that will enable them to enhance their performance continuously and to increase their sense of responsibility for managing their own performance. Coaching involves giving positive feedback that allows employees to feel confident about what they do, but it also involves giving feedback on things that can be improved. • Helping employees gain greater competence by guiding them toward acquiring more knowledge and sharpening the skills that can prepare them for more complex tasks and higher-level positions. Coaching involves a consideration of both short-term and long-term objectives, H including how the employee can benefit from acquiring new skills and knowledge that could be useful in future positions I and in novel tasks. G of coaching, it is evident that coaching Based on this list of the various functions requires a lot of effort from the managers. G For example, consider the case of NCCI Holdings, Inc., a company based in Boca Raton, Florida, that manages the largest S database of workers’ compensation insurance information in the United States (www.ncci.com). NCCI analyzes industry , trends, prepares workers’ compensation insurance rate recommendations, assists in pricing proposed legislation, and provides a variety of data products to maintain a healthy workers’ compensation system and A At NCCI Holdings, supervisors undergo reduce the frequency of employee injuries. extensive coaching training, including learning N how to listen and how to be empathic. Managers also attend monthly roundtables where they can learn from one other’s G managers can solicit feedback from other coaching experiences. At these roundtables, 13 managers regarding their own coaching performance. E Coaching helps turn feedback into results. For this to happen, coaches need to L engage in the following: A • Establish development objectives. The manager works jointly with the employees in creating the developmental plan and its objectives. • Communicate effectively. The manager maintains regular and clear communication 1 including both behaviors and results. with employees about their performance, • Motivate employees. Managers must 1 reward positive performance. When positive performance is rewarded, employees are motivated to repeat the same level of 0 positive performance in the future. • Document performance. Managers 8 observe employee behaviors and results. Evidence must be gathered regarding instances of good and poor performance. T • Give feedback. Managers measure employee performance and progress toward S and point out instances of substandard goals. They praise good performance performance. Managers also help employees avoid poor performance in the future. • Diagnose performance problems. Managers must listen to employees and gather information to determine whether performance deficiencies are the result of a lack of knowledge and skills, abilities, or motivation or whether they stem from situational factors beyond the control of the employee. Diagnosing performance problems is important because such a diagnosis dictates whether the course of action should be, for example, providing the employee with resources so that she can Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills acquire more knowledge and skills or addressing contextual issues that may be beyond the control of the employee (e.g., the employee is usually late in delivering the product because he receives the parts too late). • Develop employees. Managers provide financial support and resources for employee development (e.g., funding training, allowing time away from the job for developmental activities) by helping employees plan for the future and by giving challenging assignments that force employees to learn new things. Not all coaches perform all the coaching functions by engaging in all of the behaviors described here. Managers who do so, of course, are highly effective. In fact, some have become legendary leaders. Consider Table 9.1, which summarizes Hthe behaviors coaches used to perform the critical functions served by coaching and these functions. For example, take the caseIof Jack Welch who was extremely dedicated to developing his employees by engaging in several of the coaching behaviors G Electric (GE).14 To get involved with described here when he was CEO of General his employees, Welch spoke during a class G held at a three-week developmental course for GE’s high-potential managers. Over the course of his career, he attended S more than 750 of these classes, engaging over 15,000 GE managers and executives. During these presentations, he expected to ,answer hard questions, and he communicated honestly and candidly with his employees. After the class, he invited all the participants to talk with him after the course. In addition to attending these sessions, Aevery January. Although Welch did not he held meetings with his top 500 executives engage in formal coaching, he used the opportunities to communicate his expectaN tions and receive feedback from the various business groups at GE. G Welch also conducted formal performance reviews in which he engaged in several of the behaviors included in Table 9.1, including establishing developmental E objectives, motivating employees, documenting performance, giving feedback, and L diagnosing performance problems. He set performance targets and monitored them throughout the year. Each year the operating heads of GE’s 12 businesses received A individual two-page, handwritten notes about their performance. Welch attached the previous year ’s comments to the new reviews with comments in the margin about the progress made by the individual1managers toward his goal or the work that he still needed to do to reach the goal. Then, he distributed bonuses and reiterated the goals for the upcoming year.1This process cascaded throughout the TABLE 9.1 Coaching Major Functions Give advice Provide guidance Give support Give confidence Promote greater competence 0 8 T S Behaviors Key Establish developmental objectives Communicate effectively Motivate employees Document performance Give feedback Diagnose performance problems Develop employees Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 231 232 Part III • Employee Development organization, as other operating heads engaged in the same performance review discussions with their subordinates. Another example of Welch’s coaching behaviors occurred after he had heard customer complaints about a specific product. Welch charged the manager of the division with improving the productivity of that product fourfold. The manager sent Welch detailed weekly reports over the course of the next four years. Welch would send the reports back every three or four weeks with comments congratulating successes or pointing out areas in which the manager needed to improve. The manager stated that the fact that the CEO took the time to read his reports each week and send back comments motivated him to reach the lofty goal that Welch had set for him. In addition to this, Jack Welch tookH the time to recognize hourly workers and managers who impressed him. For example, after one high-ranking leader turned down I want his daughter to change schools, Welch a promotion and transfer because he did not sent him a personal note stating that he admired G the man for many reasons and that he appreciated his decision to put his family first. The employee explained later that this Gboth as a person and as an employee. incident proved that Welch cared about him In short, Jack Welch was a legendary S leader who developed his employees by setting expectations, communicating clearly, documenting and diagnosing perform, ance, motivating and rewarding his employees, and taking an interest in their personal development. In fact, he engaged in virtually all the behaviors and performed most of the coaching functions listed in Table 9.1. How does Jack Welch compare to the CEO A of your current company or to a CEO you have known or heard about? N effective coach. In general, however, how We can see that Welch was an extremely do we know whether a manager is doing aG good job of coaching her employees? From a results point of view, we could simply measure how many of a manager’s employees E as in the case of evaluating performance go on to become successful on their own. But, in general, we should also consider behaviors L in evaluating coaching performance. Consider the good coach questionnaire included in Table 9.2. If you are or have been in A about yourself; otherwise, think about a management position, answer the questions your current or latest supervisor or someone you know. To how many of these questions can you answer “yes”? To how many would you answer “no”? Overall, given your responses, what is the evaluation of1this person (yourself or someone else) as a coach from a behavioral point of view? 1 0 TABLE 9.2 1. 2. 3. 4. 5. 6. 7. 8. The Good Coach Questionnaire 8 Do you listen to your employees? T Do you understand the individual needs of your employees? Do you encourage employees to expressS their feelings openly? Do you provide your employees with tangible and intangible support for development? Do your employees know your expectations about their performance? Do you encourage open and honest discussions and problem solving? Do you help your employees create action plans that will solve problems and create changes when needed? Do you help your employees explore potential areas of growth and development? Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills 9.2 COACHING STYLES A manager’s personality and behavioral preferences are more likely to influence his or her coaching style. There are four main coaching styles: driver, persuader, amiable, and analyzer. First, coaches can adopt a driving style in which they tell the employee being coached what to do. Assume that the coach wants to provide guidance regarding how to deal with a customer. In this situation, the preference for a driver is to say to the employee, “You must talk to the customer in this way.” Such coaches are assertive, speak quickly and often firmly, usually talk about tasks and facts, are not very expressive, and expose a narrow range of personal feelings to others. Second, coaches can use a persuading style in which they try to sell what they want the employee to do. H to the employee why it is beneficial for Someone who is a persuader would try to explain the organization as well as for the employee Ihimself to talk to a customer in a specific way. Like drivers, persuaders are assertive, but they tend to use expansive body gesG and expose others to a broad range of tures, talk more about people and relationships, personal feelings. Third, other coaches may adopt G an amiable style and want everyone to be happy. Such coaches are likely to be more subjective than objective and direct S employees to talk to customers in a certain way because it “feels” like the right thing to do or because the employee feels it is the right, way to do it. Such coaches tend not to be very assertive and to speak deliberately and pause often, seldom interrupt others, and make many conditional statements. Finally, coaches may have a preference for analyzA and then follow rules and procedures ing performance in a logical and systematic way when providing a recommendation. To use N the same example, such analyzer coaches may tell employees to talk to a customer in a specific way “because this is what the G manual says.” Analyzers, then, are not very assertive but, like drivers, are likely to talk about tasks and facts rather than personal feelings. E Which of these four styles is best? Are drivers, persuaders, amiable coaches, or Lstyle is necessarily superior to the others. analyzers most effective? The answer is that no Good coaching should be seen as a learning opportunity and as an opportunity to set clear A goals and delegate action. Coaching involves sometimes providing direction, sometimes persuading employees how to do things a certain way, sometimes showing empathy and creating positive effects, and sometimes paying 1 close attention to established rules and procedures. One thing is for sure, however: an exclusive emphasis on one of these four 1 styles is not likely to help employees develop and grow. Ineffective coaches stick to one style only and cannot adapt to use any of the0other styles. On the other hand, adaptive coaches who are able to adjust their style according to an employee’s needs are most effec8 tive. In fact, 56% of participants in a survey of employees who had a coach at work Tbecause there was a mismatch between reported that coaching was not helping them 15 coaching style and employee need. In sum, aS combination of styles is needed. 9.3 COACHING PROCESS The coaching process is shown in Figure 9.1. We have already discussed many of the components of this process in previous chapters. The first step involves setting developmental goals. As discussed in Chapter 8, these developmental goals are a key component of the developmental plan. These goals must be reasonable, attainable, and derived from a careful analysis of the areas in which an employee needs to Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 233 234 Part III • Employee Development Set Developmental Goals Identify Developmental Resources and Strategies Implement Strategies H I G G S , A N G E L A Observe and Document Developmental Behavior Give Feedback FIGURE 9.1 Coaching Process 1 1 improve. In addition, goals should take into account both short- and long-term 0 career objectives. The second step in the coaching process 8 is to identify resources and strategies that will help the employee achieve the developmental goals. As discussed in Chapter 8, T these can include on-the-job training, attending courses, self-guided reading, mentoring, attending a conference, getting a degree,S job rotation, a temporary assignment, and membership or a leadership role in a professional or trade organization. The third step involves implementing the strategies that will allow the employee to achieve the developmental goals. For example, the employee may begin her job rotation plan or take a course online. The next step in the process is to collect and evaluate data to assess the extent to which each of the developmental goals has been achieved. Finally, the coach provides feedback to the employee, and, based on the extent to which each of the goals has been achieved, the developmental goals are revised, and the entire process begins again. Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills BOX 9.2 Training Coaches at Hallmark Hallmark (http://www.hallmark.com) sought to improve management communications with employees and initiated a training program that has been well received and viewed as a strategic benefit to the company. U.S.-based Hallmark is a retailer and wholesaler of greeting cards, stationery, flowers, and gifts with operations in the United States and Great Britain. The company initiated training to help managers become more effective in communications, enhancing their ability to provide leadership and coaching to employees. The training program sought to provide skill development in increasing two-way communication, with a greater frequency of communication and increased interaction of managers with employees. Training sessionsHincluded self-assessment, small group role-playing, and viewing video clips to enhance understanding of the role of communication. Engagement I training focused on gaining the trust of employees as well as their involvement and ownership in business outcomes. Follow-up resources were also madeGavailable for managers to continue to improve their leadership competency. Following the training in this area, managers gave positive feedback, and G has increased at all levels of the organizaemployee surveys have shown that employee engagement tion. In summary, Hallmark provides an example of a S company that made a commitment to leadership and coaching through training managers and focusing on communication skills that has translated , business results.16 into a more engaged workforce and enhanced strategic Chapter 8 included a discussion of developmental goals and developmental resources A and strategies. Let’s discuss the two remaining components of the coaching model: observing and documenting developmental behavior N data and giving feedback. G 9.3.1 Observation and Documentation of Developmental E Behavior and Outcomes Chapter 6 addressed the fact that people mayL make intentional and unintentional errors while observing and evaluating performance. A Managers may make similar errors in observing and evaluating behaviors related to developmental goals. For example, a manager might make a halo error by assuming that if an employee does a good job at working toward one developmental goal (e.g., 1 improving her typing skills), she is also doing a good job at working toward a different developmental goal (e.g., improving 1 in general, it is important to observe and customer service). As is the case for performance document behaviors specifically related to developmental activities. Documentation can 0 include memos, letters, e-mail messages, handwritten notes, comments, observations, 8 17 descriptions, and evaluations provided by colleagues. The discussion presented in this section complements information given in previous chapters because, although it is T specifically related to behaviors regarding developmental activities, it can be easily generS alized to behaviors related to performance in general. In other words, the following discussion applies to the observation of all performance behaviors, not just those displayed while working toward achieving developmental goals. Observing an employee’s progress in achieving developmental goals is not as easy as it may seem. Consider the following constraints that managers might experience in attempting to observe an employee’s performance regarding developmental activities: • Time constraints. Managers may be too busy to gather and document information about an employee’s progress toward his developmental goals. Consequently, too Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 235 236 Part III • Employee Development much time may elapse between the assignment of the activity and the manager’s checking on the employee’s progress. • Situational constraints. Managers are often unable to observe employees as they engage in developmental activities and therefore may not have firsthand knowledge about their performance. For example, managers do not observe the extent to which an employee enrolled in an online course is an active participant and contributor or is a passive learner. • Activity constraints. When the developmental activity is highly unstructured, such as an employee’s reading a book, the manager may have to wait until the activity is completed to assess whether the activity has been beneficial. How can we address these constraintsH and make sure that a manager will be able to observe and evaluate an employee’s performance regarding developmental activities? I The recommendations provided in Chapter 7 regarding the observation and evaluation G Specifically, a good communication plan of performance in general apply here as well. should explain the benefits of implementing Ga developmental plan effectively. This helps managers accept the plan. Also, managers should be trained so that they minimize errors S (i.e., rater error training), share notions of what it means to complete developmental activities successfully (i.e., frame-of-reference , training), observe performance accurately (i.e., behavioral observation training), and are confident and comfortable in managing employees’ developmental activities (i.e., self-leadership training). Finally, we need to A to invest time and effort or not in the understand the forces that motivate managers development of their employees. In otherNwords, what does the manager gain if her employee’s developmental activities are supervised appropriately? G The importance of documenting an employee’s progress toward the achievement of developmental goals cannot be overemphasized. Similarly, it is critical to document emE ployee performance in general. Why is this so important? Consider the following reasons: L • Minimize cognitive load. Observing and evaluating developmental activities, and performance in general, is a complexAcognitive task. Thus, documentation helps prevent memory-related errors. • Create trust. When documentation exists to support evaluations, there is no mystery regarding the outcomes. This, in turn,1promotes trust and acceptance of decisions based on the evaluation provided. 1 • Plan for the future. Documenting developmental activities and their outcomes 0 enables discussion about specific facts instead of assumptions and hearsay. A careful examination of these facts permits8better planning of developmental activities for the future. T • Provide legal protection. Specific laws prohibit discrimination against members of Show developmental activities are allocated. various classes (e.g., sex or religion) in For example, it is prohibited to provide male employees with better developmental opportunities than female employees. In addition, some court rulings have determined that employees working under contract may challenge a dismissal. Thus, keeping accurate records of what developmental activities employees have completed and with what degree of success as well as performance in general provides a good line of defense in case of litigation based on discrimination or wrongful termination. Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills The importance of keeping thorough performance documentation and taking actions consistent with this documentation is illustrated by the outcome of several cases. In one such case, John E. Cleverly, an employee at Western Electric Co., was discharged after 14 years of good service.18 Western Electric was found guilty of age discrimination, and Cleverly was awarded back pay because the documentation indicated that Cleverly had been given adequate performance ratings and increases to his salary over a course of 14 years. Upon his discharge, six months before his pension vested, Cleverly was informed that one reason for his discharge was to make room for younger employees. As illustrated by this case, documentation of performance should be taken seriously. In this case, the documentation available indicated the employee had a valid claim. In other H cases, documentation could be used to discount charges of discrimination. If Cleverly had alleged age discrimination, but I was deteriorating over time, then the the company could show that his performance company would have won the case. G What can managers do to document performance regarding developmental G and constructive way? Consider the activities and performance in general in a useful 19 following recommendations: S • Be specific. Document specific events , and outcomes. Avoid making general statements such as “He’s lazy.” Provide specific examples to illustrate your point, for example, “He turns in memos after deadlines at least once a month.” Ause of evaluative adjectives (e.g., good, • Use adjectives and adverbs sparingly. The poor) and adverbs (e.g., speedily, sometimes) N may lead to ambiguous interpretations. In addition, it may not be clear whether the level of achievement has been average or G outstanding. • Balance positives with negatives. Document instances of both good and poor E performance. Do not focus only on the positives or only on the negatives. L on information that is job related and • Focus on job-related information. Focus specifically related to the developmentalAactivities and goals at hand. • Be comprehensive. Include information on performance regarding all developmental goals and activities, and cover the entire review period as opposed to a shorter time period. Also, document the 1 performance of all employees, not just those who are not achieving their developmental goals. 1 and format to document information • Standardize procedures. Use the same method for all employees. 0 • Describe observable behavior. Phrase your notes in behavioral terms and avoid 8 statements that would imply subjective judgment or prejudice. T Obviously, not all managers do a good job of documenting performance about S or performance in general. Table 9.3 the accomplishment of developmental goals includes a summarized list of recommendations to follow in the documentation process. Now, consider the recommendations listed in Table 9.3 in evaluating the set of quotes appearing in Table 9.4 reportedly taken from actual employee performance evaluations in a large corporation in the United States.20 We can be sure that the employees at the receiving end of these quotes would not be very happy with them. It also goes without saying that this type of documentation Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 237 238 Part III • Employee Development TABLE 9.3 Documentation of Performance and Performance in Developmental Activities: Some Recommendations Be specific. Use adjectives and adverbs sparingly. Balance positives with negatives. Focus on job-related information. Be comprehensive. Standardize procedures. Describe observable behavior. H I would be extremely detrimental to the performance management system. In fact, this G organization would have serious problems beyond the scope of its performance evaluG ation system. Now, let’s turn to the final importantScomponent of the coaching process: giving feedback. , TABLE 9.4 Individual Quotes Taken from AActual Employee Performance Evaluations Since my last report, this employee has reachedN rock bottom . . . and has started to dig. I would not allow this employee to breed. G This employee is really not so much of a has-been, but more of a definitely won’t be. E Works well when under constant supervision and cornered like a rat in a trap. L He would be out of his depth in a parking lot puddle. He sets low personal standards and then consistently A fails to achieve them. This employee is depriving a village somewhere of an idiot. This employee should go far, . . . and the sooner he starts, the better. 1 He’s been working with glue too much. He would argue with a signpost. 1 He has a knack for making strangers immediately detest him. 0 He brings a lot of joy whenever he leaves the room. 8 . . . he’s the other one. If you see two people talking and one looks bored Donated his brain to science before he was done T using it. Gates are down, the lights are flashing, but the train isn’t coming. S If he were any more stupid, he’d have to be watered twice a week. If you gave him a penny for his thoughts, you’d get change. If you stand close enough to him, you can hear the ocean. One neuron short of a synapse. Some drink from the fountain of knowledge . . . he only gargled. Takes him 2 hours to watch 60 Minutes. The wheel is turning, but the hamster is dead. Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills 9.3.2 Giving Feedback Giving feedback to an employee regarding her progress toward achieving her goals is a key component of the coaching process.21 Feedback is information about past behavior that is given with the goal of improving future performance. Although “back” is part of feedback, giving feedback has both a past and a future component. This is why, when done properly, feedback can be relabeled feed forward.22 Feedback includes information about both positive and negative aspects of job performance and lets employees know how well they are doing with respect to meeting the established standards.23 For example, the so-called 2+2 performance appraisal model for teachers includes peer teachers who observe each other perform in the classH two suggestions for improvement.24 room and then offer two compliments and Feedback is important in the context of performance regarding development activities I and goals. Our discussion of feedback, however, goes beyond that and includes feedG is not a magic bullet for performance back about performance in general. Feedback 25 improvement; however, it serves several important purposes: G • Helps build confidence. Praising good performance builds employee confidence S regarding future performance. It also lets employees know that their manager , cares about them. • Develops competence. Communicating clearly about what has been done right and how to do the work correctly is valuable information that helps employees A become more competent and improve their performance. In addition, communiN right and explaining what to do next cating clearly about what has not been done time provide useful information so thatG past mistakes are not repeated. • Enhances involvement. Receiving feedback and discussing performance issues allow employees to understand theirE roles in the unit and organization as a whole. This, in turn, helps employees become more involved in the unit and the L organization. A Unfortunately, however, the mere presence of feedback, even if it is delivered correctly, does not necessarily mean that all of these purposes will be fulfilled. For example, a review of 131 studies that examined 1 the effects of feedback on performance concluded that 38% of the feedback programs reviewed had a negative effect on 1 the implementation of feedback led to performance.26 In other words, in many cases, lower performance levels. This can happen0when, for example, feedback does not include useful information or is not delivered in the right way. For example, feedback 8 can have detrimental effects if it focuses on the employee as a whole as opposed to specific behaviors at work. This is precisely T the case of a very successful woman who made many personal sacrifices such as not starting a family to reach the top echelons S of the organizational hierarchy.27 She received feedback that included information that she had failed to retain a valued client. The feedback was accurate and delivered in the correct manner; however, after receiving the feedback, she began to question her life choices in general instead of focusing on how to retain valued clients in the future. In this example, feedback was not instrumental in improving performance; instead, the feedback created self-doubt and questions about identity. Although some feedback systems do not work well, the advantages of providing feedback generally outweigh any disadvantages. Also, consider the possible cost of not Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 239 240 Part III • Employee Development providing feedback. First, organizations would be depriving employees of a chance to improve their performance. Second, organizations might be stuck with chronic poor performance because employees did not recognize any performance problems and felt justified in continuing to perform at substandard levels. Finally, employees might develop inaccurate perceptions of how their performance is regarded by others. Given that, overall, feedback systems are beneficial, what can we do to make the most of them? Consider the following suggestions to enhance feedback:28 • Timeliness. Feedback should be delivered as close to the performance event as possible. For feedback to be most meaningful, it must be given immediately after the event. • Frequency. Feedback should be provided on an ongoing basis, daily if possible. If H performance improvement is an ongoing activity, then feedback about performance I basis. should also be provided on an ongoing • Specificity. Feedback should include G specific work behaviors, results, and the situation in which these behaviors and results were observed.29 Feedback is not G about the employee and how the employee “is,” but about behaviors and results and situations in which these behaviors and results occurred. S • Verifiability. Feedback should include information that is verifiable and accurate. , rumors. Using information that is verifiable It should not be based on inferences or leads to more accurate feedback and subsequent acceptance. • Consistency. Feedback should be consistent. In other words, information about A not vary unpredictably between overspecific aspects of performance should whelming praise and harsh criticism.N • Privacy. Feedback should be given in a place and at a time that prevent any G to both criticism and praise, because potential embarrassment. This applies some employees, owing to personality E or cultural background, may not wish to be rewarded in public. L • Consequences. Feedback should include contextual information that allows the A and consequences of the behaviors and employee to understand the importance results in question. For example, if an employee became frustrated and behaved inappropriately with an angry customer and the customer’s complaint was not 1 explain the impact of these behaviors addressed satisfactorily, feedback should (e.g., behaving inappropriately) and 1 results for the organization (e.g., the customer’s problem was not resolved, the customer was upset, the customer was 0 organization). not likely to give repeat business to the • Description first, evaluation second. 8Feedback should first focus on describing behaviors and results rather than on evaluating and judging behaviors and results. It is better first to report whatThas been observed and, once there is agreement about what happened, to evaluate S what has been observed. If evaluation takes place first, employees may become defensive and reject the feedback. • Performance continuum. Feedback should describe performance as a continuum, going from less to more in the case of good performance and from more to less in the case of poor performance. In other words, feedback should include information on how to display good performance behaviors more often and poor performance behaviors less often. Thus, performance is a matter of degree, and even the worst performer is likely to show nuggets of good performance that can be described as a starting point for a discussion on how to improve performance. Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills • Pattern identification. Feedback is most useful if it is about a pattern of poor performance rather than isolated events or mistakes. Identifying a pattern of poor performance also allows for a better understanding of the causes leading to poor performance. • Confidence in the employee. Good feedback includes a statement that the manager has confidence that the employee will be able to improve her performance. It is important for the employee to hear this from the manager. This reinforces the idea that feedback is about performance and not the performer. Note, however, that this should be done only if the manager indeed believes the employee can improve her performance. In the case of a chronic poor performance, this type of information could be used out of context Hlater if the employee is fired. • Advice and idea generation. Feedback can include advice given by the supervisor I about how to improve performance. In addition, however, the employee should play an active role in generating ideas about how G to improve performance in the future. G Many of the above-mentioned recommendations are particularly useful when feedback is given to employees who score low on aSpersonality trait labeled core self-evaluation, which is a combination of four traits: self-esteem (i.e., the degree to which an individual , holds a favorable attitude toward himself), self-efficacy (i.e., the degree to which an individual believes he is capable of taking action and taking control over events), emotional stability (i.e., the degree to which an individual is not insecure, guilty, or timid), and locus of A control (i.e., the degree to which an individual believes he can control events and outcomes in his live). Individuals with low core self-evaluations feel they are less able to deal with the N world and, consequently, are overall less satisfied with their jobs and lives. Thus, supervisors need to be aware that feedback is likely toG be received by individuals with low versus high core self-evaluations.30 For example, low core E self-evaluation employees may feel hurt and helpless after receiving negative feedback. Thus, the recommendations about “confiL dence in the employee” are particularly relevant. Similarly, the recommendations about A helpful so that there is a clear course of “advice and idea generation” are also particularly action—rather than feelings of helplessness and lack of direction. Consider the following vignette in which Andrea, a supervisor, has observed a 1 specific performance event and provides feedback to her subordinate. Andrea is the manager of a small retail store with approximately five employees. With a small staff, 1 Andrea looks for coaching opportunities on a weekly basis. Andrea is working with Matt today, and she has just witnessed him0complete a customer sale. Matt did not follow several steps, however, that should be 8 included at each sale and, because the store is now empty, Andrea decides it is a perfect opportunity for a coaching session. ANDREA: MATT: ANDREA: MATT: ANDREA: T Hey, Matt, that was great the waySthat you just assisted that customer in finding her correct size in the jeans. Thanks for taking the extra time to help her. Thanks, Andrea, not a problem. I would like to go over the sales transaction with you. Sure. After you helped the woman find her jeans, you promptly brought her over and rang her up. That was a good sale because those jeans were a full-priced Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 241 242 Part III • Employee Development MATT: ANDREA MATT: ANDREA: item; however, you didn’t complete all of the tasks associated with closing a sale. In the training last week, we discussed the importance of adding on additional sales, entering the customer’s personal contact information in our computer, and letting them know about upcoming sales. Yes, I just remembered us talking about that. When customers seem in a hurry, I feel bad about asking them additional questions. That’s a very valid concern. Can we think of ways to increase the efficiency of adding these few steps into the sales transaction process so that you feel comfortable performing them in the future? I would like to help you do that because increasing the number of items you sell during each transaction H sales contests. could help you win the upcoming I like some new ideas about talking to That would be great. I would really customers. G No problem; I know that you are a very capable salesperson. You have G I think that you can improve your sales great customer service skills, and and possibly win one of the upcoming contests. S , Andrea and Matt then generate ideas about how to improve Matt’s performance. In this vignette, Andrea demonstrated several of the feedback behaviors listed in Table 9.5. She was specific about the behaviors and results, the information was verifiA able, and it was timely because the behavior had just occurred. In addition, since Andrea N basis, the information she provides is communicates her expectations on a weekly consistent. Finally, she described the behavior G first and then evaluated its effectiveness; she communicated confidence in Matt, and she offered to help him generate ideas about E hand, Andrea left out several important how to improve his effectiveness. On the other things while coaching Matt. First, she didLnot communicate the consequences of his behavior (e.g., his failure to follow the procedures could hurt sales for the entire store). Although the vignette does not describe A the idea generation portion of the feedback session, Andrea did not describe small behaviors that Matt could use to improve his 1 TABLE 9.5 Most Effective 1 Feedback Should Be Timely 0 Frequent 8 Specific Verifiable T Consistent S Private Consequential Descriptive first and evaluative second Related to a performance continuum Based on identifiable patterns of performance A confidence builder for employees A tool for generating advice and ideas Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills performance. Finally, Andrea did not communicate to Matt whether this behavior was a one-time incident or whether it was a pattern that was affecting his overall work performance. Overall, if Andrea continues to look for coaching opportunities with her employees, her relationship with her employees and their performance in the store will continue to improve. To be more effective, however, she may need to work on communicating the patterns of behavior that lead to poor performance and the consequences of continued poor performance. Good feedback includes information about both good and poor performance. Although most people are a lot more comfortable giving feedback on H good performance than they are on poor performance, some guidelines must be followed when giving praise so that the I feedback is useful in terms of future performance. First, praise should be sincereGand given only when it is deserved. If praise is given repeatedly and when it is not deserved, employees are not able to see GSecond, praise should be about specific when a change in direction may be needed.31 behaviors or results and be given within context S so that employees know what they need to repeat in the future. For example, a manager can say the following:32 “John, , our client. Your efforts helped us renew thanks for providing such excellent service to our contract with them for another two years. It’s these types of behaviors and results that our group needs to achieve our goal for this year. And, this is exactly what our company is all about: providing outstanding A customer service.” Third, in giving praise, managers should take their time and act N pleased, rather than rush through the information looking embarrassed. Finally, avoid giving praise by referring to the absence of the negative, for example, “not G bad” or “better than last time.” Instead, praise should emphasize the positives and beEphrased, for example, as “I like the way you did that” or “I admire how you did that.”33 L Consider the following vignette which illustrates how a manager might give A praise to his employee. After the successful completion of a three-month project at a large telecommunications company, Ken, the manager, wants to congratulate Mike on a job well done. 1 project is completed. Ken calls Mike into his office one day after the 9.3.2.1 PRAISE KEN: MIKE: KEN: Thanks for stopping by Mike, and1thank you for all of your hard work over the past three months. I know 0 that I might not have congratulated you on every milestone you reached along the way, but I wanted to take 8 the time to congratulate you now. Your organizational skills and ability to Tdepartments led to the successful interact successfully with multiple completion of the project on time and within budget. S Thanks, Ken. I have really been putting extra effort into completing this project on time. It shows, Mike, and I appreciate all of your hard work and dedication to this team and our department. Thanks again and congratulations on a great end to a long three months. In this vignette, Ken delivered praise to Mike successfully and followed the recommendations provided earlier. He was sincere and made sure not to praise Mike Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 243 244 Part III • Employee Development too often so that when he did praise him, it was meaningful. He described how Mike’s organizational and project management skills led to the successful completion of the project. Finally, Ken took his time in delivering the praise and made sure that Mike took the praise seriously. NEGATIVE FEEDBACK Negative feedback includes information that performance has fallen short of accepted standards. The goal of providing negative feedback is to help employees improve their performance in the future; it is not to punish, embarrass, or chastise them. It is important to give negative feedback when it is warranted because the consequences of not doing so can be detrimental for the organization as a whole. For example, Francie Dalton, president of Dalton Alliances, H Inc., noted, “In organizations where management imposes no consequences for poor I they don’t want to be where mediocrity performance, high achievers will leave because is tolerated. But mediocre performers willG remain because they know they’re safe. The entire organizational culture, along with its reputation in the marketplace, can be G affected by poor performers.”34 In spite of the need to address poor S performance, managers are usually not very comfortable providing negative feedback. Why is this so? Consider the following reasons: 9.3.2.2 , • Negative reactions and consequences. Managers may fear that employees will react negatively. Negative reactions can include being defensive and even becoming angry at the information received. InA addition, managers may fear that the working relationship, or even friendship, with their subordinates may be affected N adversely and that giving negative feedback can introduce elements of mistrust and annoyance. G • Negative experiences in the past. Managers themselves may have received negative E feedback at some point in their careers and have experienced firsthand how feelings can be hurt. Receiving negative feedback can be painful and upsetting, and L managers may not want to put their subordinates in such a situation. A • Playing “god.” Managers may be reluctant to play the role of an all-knowing, judgmental god. They may feel that giving negative feedback puts them in that position. 1 • Need for irrefutable and conclusive evidence. Managers may not want to provide negative feedback until after they have1been able to gather irrefutable and conclusive evidence about a performance problem. 0 Because this task may be perceived as too onerous, managers may choose to skip giving negative feedback altogether. 8 What happens when managers avoid giving negative feedback and employees avoid seeking it? A feedback gap results, inTwhich managers and employees mutually instigate and reinforce lack of communication S which creates a vacuum of meaningful exchanges about poor performance.35 A typical consequence of a feedback gap is that, in the absence of information to the contrary, the manager gives the employee the message that performance is adequate. When performance problems exist, they are likely to become more intense over time. For example, clients may be so dissatisfied with the service they are receiving that they may eventually choose to close their accounts and work instead with the competition. At that time, it becomes impossible for the manager to overlook the performance problem, and she has no choice but to deliver Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills the negative feedback. At this stage of the process, however, feedback is delivered too late and often in a punitive fashion. Of course, feedback delivered so late in the process and in a punitive fashion is not likely to be helpful. Alternatively, negative feedback is most useful when early coaching has been instrumental in identifying warning signs and the performance problem is still manageable. Negative feedback is also useful when it clarifies unwanted behaviors and consequences and focuses on behaviors that can be changed. There is no point in providing feedback on issues that are beyond the employee’s control because there is not much she can do to improve the situation. In addition, employees are more likely to respond constructively to negative feedback when the manager is perceived as being trustworthy and making a genuine attempt toHimprove the employee’s performance. In other words, the manager needs to be perceived as credible and as instrumental in I future.36 Finally, negative feedback is improving the employee’s performance in the most likely to be accepted when it is given by Ga source who uses straight talk and not subtle pressure and when it is supported by hard data. The supervisor must control her emotions and stay calm. If managers followGthese suggestions, it is more likely that employees will benefit from negative feedback, S even if employees are not particularly open to receiving it.37 Following these suggestions leads to what has been labeled , “actionable feedback,” meaning that such feedback will allow employees to respond in constructive ways and will lead to learning and performance improvement.38 Overall, regardless of whether the feedback session includes praise or a discussion A of needed areas of improvement, it should provide answers to the following N questions:39,40 G you need to do your job? 1. How is your job going? Do you have what 2. Are you adequately trained? Do you haveE the skills and tools you need to do your job? 3. What can be done to improve your and your unit’s/organization’s job/products/ L services? 4. How can you better serve your internal A and external customers? 9.3.3 Disciplinary Process and Termination 1 In some cases, an employee may not respond 1 to the feedback provided and may not make any improvements in terms of performance. In such cases, there is one interme0 diate step that can be taken before the employee enters a formal disciplinary process which involves a verbal warning, a written warning, and may lead to termination. The 8 employee can be given a once-in-a-career decision-making leave.41 This is a “day of T contemplation” that is paid and allows the employee to stay home and decide whether working in this organization is what he or sheSreally wants to do. This practice is based on adult learning theory, which holds individuals responsible for their actions. Unlike a formal disciplinary action, the decision-making leave does not affect employee pay. As noted by Tim Field, principal of a consulting firm in Los Angeles, California, “This element of holding people accountable without negatively impacting their personnel file or payroll tends to catch people off guard, because problem employees, like problem children, are often expecting negative attention for their bad behavior.” How can the decision to grant an employee a decision-making leave be communicated? Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 245 246 Part III • Employee Development Assuming this is a company policy and there is senior management support, you can communicate the leave as follows:42 Lucy, as you know, you and I have met on several occasions to talk about your performance. In spite of these feedback sessions, I see that you are still having some difficulties with important tasks and projects. Consistent with my observations, I have received comments from some of your peers related to some performance deficiencies they have also noticed. I think that issuing a written warning would be counterproductive—I am concerned that it may decrease your motivation and do more harm than good. Instead, what I am going to do is to put you on what we call a “decision-making leave” for a day. This is a type of H with other individuals in your same intervention that has worked very well position in the past. I want you to knowI that this is a once-in-a-career benefit that you should use to your advantage and I decided to do this because I truly G believe that you are capable of improving your performance. It works like this. I am going to ask you to not come to theG office tomorrow but you will be paid for that day, so you don’t have to worry about your paycheck being affected. While S you are away from the office tomorrow, I want you to give serious thought , in this company. You and I will meet about whether you really want to work when you return to the office the day after tomorrow and I will ask you to tell me whether you’d rather resign and look for work elsewhere. I will understand A decision. On the other hand, if when and will be fully supportive if that is your we meet you tell me you want to keep Nyour job here, then I will give you an additional assignment on which I want you to work while you are away from Gbeing paid for the day, so here is what the office tomorrow. Recall that you are I want you to do. Please prepare a one-page E letter addressed to me convincing me that you assume full and total responsibility for the performance issues we L You will have to provide clear and discussed during our feedback sessions. specific arguments as well as describeA a specific set of actions you will take to convince me that you will address the problems. I will keep the letter in a safe place but I am not planning on including it in your personnel file for now. To be clear, however, this letter is a personal 1 commitment from you to me and our agreement is that if you don’t stick to the terms of your letter, you will essentially 1 fire yourself. This is a very important moment for you and for me, and it could 0 be a turning point in your career development. Now that I have explained the process, I would like to hear any questions or comments you may have about 8 this “decision-making leave day” that you will be taking tomorrow. T Using a decision-making leave as part of the performance management system can S be a powerful tool to give problem employees an opportunity to improve their performance. However, this tool may not lead to the desired outcomes, and the employee may have to enter into a disciplinary process. Note that a demotion or transfer may be a more appropriate action when there is evidence that the employee is actually trying to overcome the performance deficiencies but is not able to do so. However, termination is the appropriate action when performance does not improve and the employee continues to make the same mistakes or fails to meet standards. Also, termination is the appropriate course of action when an employee engages in serious violations of policies, laws, or regulations such as theft, fraud, falsifying documents, and related serious offences. Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills The disciplinary process should not come as a surprise to the employee or supervisor if there is a good performance management system in place because there are plenty of opportunities for the employee to overcome performance problems and for the supervisor to offer support and feedback so that willing and able employees will be able to do so. However, when a disciplinary process seems to be the only recourse, it is important to follow a set of steps so as not to fall into legal problems. Also, all employees, even those who are terminated, deserve to be treated with respect and dignity. Nevertheless, even if there is a top-notch performance management system in place, there are several pitfalls that must be avoided and specific actions supervisors can take to do so, which are the following:43 1. Pitfall 1: Acceptance of poor performance. H Many supervisors may just want to ignore poor performance hoping that the problem will go away. Unfortunately, in I most cases, the performance problems escalate and become worse over time. G the problem. Addressing it as soon as Suggested course of action: Do not ignore possible can not only avoid negative consequences for the employee in question, G coworkers, and customers but also help put the employee back in track in terms of S his career objectives. 2. Pitfall 2: Failure to get the message through. , The poor performing employee may argue that she did not know the problem was serious or that it existed at all. Suggested course of action: In the decision-making leave described earlier, make sure to be very specific about the performance problem and the consequences of A not addressing it effectively. Make sure you document the action plan and that N regarding the plan. you have secured the employee’s agreement 3. Pitfall 3: Performance standards are “unrealistic” or “unfair.” The employee may G argue that performance standards and expectations are unrealistic or unfair. Suggested course of action: Remind the E employee that his performance standards are similar to others holding the same position. Also, remind the employee that perL formance standards have been developed over time with the participation of the A employee in question, and share with him documentation regarding past review meetings, including past appraisal forms with the employee signature on them. 4. Pitfall 4: Negative affective reactions. The employee may respond emotionally 1 ranging from tears to shouts and even threats of violence. This, in turn, may create an emotional response on the part of the1supervisor. Suggested course of action: Do not let emotional reactions derail you from your 0 mission, which is to describe the nature of the problem, what needs to be done, and consequences of not doing so. If the8employee is crying, do offer compassion, and give him some space to compose himself. You can give the employee some T time and resume the meeting a few minutes later or a rescheduling of the meeting at a later time may be a good alternative.SIf the employee reaction involves a threat or suggest possible violence, call security immediately. If such threats do take place, report them to the human resources (HR) department. 5. Pitfall 5: Failure to consult HR. There are hundreds of wrongful termination cases that have cost millions of dollars to organizations that have not followed the appropriate termination procedures. Suggested course of action: If you are planning on implementing a disciplinary or termination process, consult with your HR department regarding legal requirements. For the most part, if you have a good performance management Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 247 248 Part III • Employee Development system in place, you have all necessary steps in place. However, consulting with HR is a good idea to ensure you are following all appropriate steps. Avoiding the above pitfalls will minimize the possibility of problems during the formal disciplinary process. If the goals are not reached, there will be a need for a termination meeting. This meeting is of course extremely unpleasant for all involved, to say the least. However, it is the right and fair thing to do at this stage. Suggestions for the termination meeting are as follows:44 1. Be respectful. It is important to treat the terminated employee with respect and dignity. Keep the information about the termination confidential, although it is H likely others will learn about it in subsequent days. 2. Get right to the point. At this stage, Ithe less said, the better. Summarize the performance problems, actions taken to try to overcome these problems, outcomes G termination that you have reached. of these actions, and the decision about 3. Wish the employee well. The purposeG of the meeting is not to rehash every single reason why you are letting the employee go and every single instance of poor S performance. Instead, use the meeting to wish the person well in her next job and endeavors, and tell her that she will be , missed. 4. Send the employee to HR. Let the employee know that he needs to go to HR to receive information on benefits, including vacation pay, and to receive informaA in a small business, seek outside legal tion on legal rights. If you are working counsel regarding the information toN give to the terminated employee. 5. Have the employee leave immediately. Keeping the terminated employee on-site can G lead to gossip and conflict, and disgruntled employees may engage in sabotage. 6. Have the termination meeting at the end E of the day. It is better to conduct the termination meeting at the end of the day so that the employee can leave the office as L around. everyone else when there are fewer people A The aforementioned information regarding the disciplinary process and termination may be used as a follow-up to a formal performance review meeting held because of a lack of remedial action on the part of the employee. So, let’s discuss performance review 1 meetings next, which may or may not lead to the disciplinary process and termination we 1 just discussed. 0 9.4 PERFORMANCE REVIEW MEETINGS 8 Supervisors who manage employee performance often feel uncomfortable in this role T because managing performance requires that they judge and coach at the same time.45 S by evaluating performance and allocating In other words, supervisors serve as judges rewards. In addition, supervisors serve as coaches by helping employees solve performance problems, identify performance weaknesses, and design developmental plans that will be instrumental in future career development. In addition, supervisors feel uncomfortable because they feel they need to convey bad news and employees may react negatively. In other words, there is a concern that managing performance unavoidably leads to negative surprises. Not surprisingly, employees are usually not satisfied with their performance reviews. For example, a survey of Australian employees conducted by the Gallup organization Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills found that less than 20% of employees reported that their performance reviews helped them improve their performance. Overall, the majority of respondents reported being dissatisfied with the level of feedback and frequency of performance reviews from managers.46 Because supervisors play these paradoxical roles, it is usually helpful to separate the various meetings related to performance. Separating the meetings also minimizes the possibility of negative surprises.47 Moreover, when meetings are separated, it is easier to separate the discussion of rewards from the discussion about future career development. This allows employees to give their full attention to each issue, one at a time. Chapter 6 noted that performance management systems can involve as many as six formal meetings. Each of these sessions should be seen as a work meeting with specific goal, including the following: H • System inauguration. The purpose of thisI meeting is to discuss how the performance management system works, which requirements and responsibilities rest primarily G on the employee, and which rest primarily on the supervisor. G • Self-appraisal. The purpose of this meeting is to discuss the self-appraisal prepared by the employee. S • Classical performance review. The purpose of this meeting is to discuss employee performance, including the perspectives, of both the supervisor and the employee. • Merit/salary review. The purpose of this meeting is to discuss what, if any, compensation changes will result from the employee’s performance during this A period. • Developmental plan. The purpose of this N meeting is to discuss the employee’s developmental needs and what steps will be taken so that performance will be improved during the following period. G • Objective setting. The purpose of this meeting is to set performance goals that are E both behavior and results oriented for the following review period. L Although six types of meetings are possible, not all six take place as separate A meetings. For example, the self-appraisal, classical performance review, merit/salary review, developmental plan, and objective setting meetings may all take place during one umbrella meeting labeled “performance review 1 meeting.” As noted above, however, it is better to separate the various types of information discussed so that the employee and 1 supervisor focus on each of the components separately. Note, however, that the conversation about compensation should be related to0performance (i.e., employees must understand the direct link between performance and compensation decisions). 8 there are several steps that must be taken Regardless of the specific type of meeting, before the meeting takes place. Specifically, it isTuseful to give at least a two-week advance notice to the employee to inform her of the purpose of the meeting and enable her to preS pare for it. Also, it is useful to block out sufficient time for the meeting and arrange to meet in a private location without interruptions. Taking these steps sends a clear message that the meeting is important and that, consequently, performance management is important. As noted above, most organizations merge several meetings into one labeled “performance review meeting.” The typical sequence of events for such a meeting is the following:48 • Explain the purpose of the meeting. The first step includes a description of the purpose of the meeting and the topics to be discussed. Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 249 250 Part III • Employee Development • Conduct self-appraisal. The second step includes asking the employee to summarize her accomplishments during the review period. This is more easily accomplished when the employee is given the appraisal form to be used by the supervisor before the meeting. This portion of the meeting allows the employee to provide her perspective regarding performance. The role of the supervisor is to listen to what the employee has to say and to summarize what he hears. This is not an appropriate time for the supervisor to disagree with what the employee says. • Share ratings and explain rationale. Next, the supervisor explains the rating he provided for each performance dimension and explains the reasons that led to each score. It is more effective to start withH a discussion of the performance dimensions for which there is agreement between the employee’s self-appraisal and the supervisor’s appraisal. This is likely to Ireduce tension and to demonstrate to the employee that there is common ground G and that the meeting is not confrontational. Also, it is better to start with a discussion of the performance dimensions G move on to the dimensions for which the for which the scores are highest and then scores are lower. For areas for which S there is disagreement between self- and supervisor ratings, the supervisor must take great care in discussing the reason for , his rating and provide specific examples and evidence to support the score given. At this point, there should be an effort to resolve discrepancies, and the supervisor should take extra care with sensitive areas. The employee should be provided A with the opportunity to explain her viewpoint thoroughly. This is a very useful N performance expectations. For dimendiscussion because it leads to clarifying sions for which the score is low, thereG should be a discussion of the possible causes for poor performance. For example, are the reasons related to lack of knowledge, E beyond the control of the employee? lack of motivation, or contextual factors • Discuss development. After the supervisor and employee have agreed on the L scores given to each performance dimension, there should be a discussion about A the supervisor and the employee should the developmental plan. At this point, discuss and agree on the developmental steps that will be taken to improve performance in the future. 1 employee should summarize, in her own • Ask employee to summarize. Next, the words, the main conclusions of the 1 meeting: what performance dimensions are satisfactory, which ones need improvement, and how improvement will be achieved. 0 This is an important component of the meeting because it gives the supervisor an opportunity to determine whether he8and the employee are in accord. • Discuss rewards. The next step during the meeting includes discussing the relaT tionship between performance and any reward allocation. The supervisor S rewards and how the employee would should explain the rules used to allocate be able to reach higher reward levels as a consequence of future performance improvement. • Hold follow-up meeting. Before the meeting is over, it is important to schedule the next performance-related formal meeting. It is important that the employee understand that there will be a formal follow-up and that performance management is not just about meeting with the supervisor once a year. Usually, the next meeting will take place just a few weeks later to review whether the developmental plan is being implemented effectively. Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills • Discuss approval and appeals process. Finally, the supervisor asks the employee to sign the form to attest that the evaluation has been discussed with him. This is also an opportunity for the employee to add any comments or additional information he would like to see included on the form. In addition, if disagreements about ratings have not been resolved, the supervisor should remind the employee of the appeals process. • Conduct final recap. Finally, the supervisor should use the “past-present-future model.” In other words, the supervisor summarizes what happened during the review period in terms of performance levels in the various dimensions, reviews how rewards will change based on this level of performance, and sums up what the employee will need to do in the next yearHto maintain and enhance performance. I very important purposes. First, these Performance review discussions serve discussions allow employees to improve theirG performance by identifying performance problems and solutions for overcoming them. Second, they help build a good relationG because the supervisor shows that she ship between the supervisor and the employee cares about the employee’s ongoing growth and S development and that she is willing to invest resources, including time, in helping the employee improve. , Unfortunately, these purposes are not always realized because employees may be defensive, and many supervisors do not know how to deal with this attitude because they lack the necessary skills to conduct an effective performance review. How can we tell when Aare two patterns of behavior that indicate an employee is being defensive? Typically, there 49 defensiveness. First, employees may engageNin a fight response. This includes blaming others for performance deficiencies, staring mutely at the supervisor, and other, more Geven pounding the desk. Second, employaggressive responses such as raising her voice or ees may engage in a flight response. This includes E looking away, turning away, speaking softly, continually changing the subject, or quickly agreeing with what the supervisor is sayL ing without basing the agreement on a thoughtful and thorough discussion about the issues Aresponse during the performance review at stake. When employees have a fight-or-flight discussion, it is unlikely that the meeting will lead to improved performance in the future. What can supervisors do to prevent defensive responses? Consider the following 1 suggestions: 1 • Establish and maintain rapport. It is important that the meeting take place in a good climate. As noted earlier, this can0be achieved by choosing a meeting place that is private and by preventing interruptions from taking place. Also, the super8 visor should emphasize two-way communication and put the employee at ease as quickly as possible. This can be done byT sitting next to the employee as opposed to across a desk, by saying his name, by thanking him for coming, and by beginning S with small talk to reduce the initial tension. When good rapport is established, both the supervisor and the employee are at ease, relaxed, and comfortable. They can have a friendly conversation, and neither is afraid to speak freely. Both are open-minded and can express disagreement without offending one another. On the other hand, when there is no good rapport, both participants may be nervous and anxious. The conversation is cold and formal and both may fear to speak openly. The supervisor and employee are likely to interrupt each other frequently and challenge what the other is saying. Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 251 252 Part III • Employee Development • Be empathetic. It is important for the supervisor to put herself in the shoes of the employee. The supervisor needs to make an effort to understand why the employee has performed at a certain level during the review period. This includes not making attributions that any employee success was caused by outside forces (e.g., a good economy) or that employee failures were caused by inside forces (e.g., employee incompetence). • Be open-minded. If the employee presents an alternative and different point of view, be open-minded, and discuss them directly and openly. There is a possibility that the employee may provide information that is relevant and of which you are not aware. If this is the case, ask for specific evidence.50 • Observe verbal and nonverbal cues. The H supervisor should be able to read verbal and nonverbal signals from the employee to determine whether further clarificaI be attentive to the employee’s emotions tion is necessary. The supervisor should and react accordingly. For example, ifG the employee becomes defensive, the supervisor should stop talking and allow the employee to express her point of view regarding the issue being discussed. G • Minimize threats. The performance review meeting should be framed as a meetS ing that will benefit the employee, not punish him. , • Encourage participation. The employee needs to have her own conversational space to speak and express her views. The supervisor should not dominate the meeting; rather, she should listen without interrupting and avoid confrontation A and argument. N In spite of these suggestions, defensiveness may be unavoidable in some situations. In such situations, supervisors needG to recognize that employee defensiveness is inevitable, and they need to allow it. RatherEthan ignoring the defensive attitude, supervisors need to deal with the situation head on. First, it is important to let the employee L vent and to acknowledge the employee’s feelings. To do this, the supervisor may want to pause to accept the employee’s feelings. Then, the supervisor may want to ask the A employee for additional information and clarification. If the situation is reaching a point where communication becomes impossible, the supervisor may want to suggest suspending the meeting until a later time. 1 51 For example, the supervisor may say, “I understand that you are angry and that you believe you have been treated unfairly. 1 It’s important that I understand your perspective, but it’s difficult for me to absorb the information when you are so upset. This is0an important matter. Let’s take a break, and get back together at 3:00 P.M. to continue our discussion.” To be sure, if the relationship 8 between the supervisor and the employee is not good, the performance review meeting is likely to expose these issues in a blatant T and often painful way. Consider the following vignette. Jason is the manager at a large accounting firm, S and Susan is one of the employees on his team. He chooses a conference room with privacy away from the other offices. JASON: SUSAN: JASON: Hi, Susan. I wanted to meet with you today to discuss your performance appraisal for this quarter. At any time, please offer your input and ask questions if you have any. OK. You did meet two important objectives that we set this quarter: sales and customer service. Thanks for your hard work. Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills SUSAN: JASON: SUSAN: JASON: SUSAN: JASON: SUSAN: JASON: SUSAN: JASON: SUSAN: 253 No problem. You did miss three of the other objectives. What? I worked as hard as I could! It wasn’t my fault that the other people on the team did not carry their weight. Susan, I am not here to blame anyone or to attack you. I want to generate some ideas on what we can do to ensure that you meet your objectives and receive your bonus next quarter. SITTING BACK WITH CROSSED ARMS: I told you I worked as hard as I could. I know that you worked hard, Susan, and I know how hard it is to balance H our department. When I first started, all of the objectives that we have in I had a hard time meeting all of the objectives as well. I It is hard and I try my best. G Susan, can you think of anything that we can work on together that would G Is there any additional training or help you meet the last three objectives? resources that you need? S I am having a hard time prioritizing all of my daily tasks. There is a class , offered online on prioritizing, but I feel I am too busy to take it. That is good that you think the class will help. Take the class online, which will not disrupt your work schedule, A and I will go to all of your meetings and follow up with clients as needed. N Thanks, Jason. I really appreciate your help. G How did Jason do in dealing with Susan’s defensiveness? Overall, he did a E good job. Jason was empathetic, he picked up on Susan’s nonverbal behavior, he had her offer her input, he held the meeting inLa comfortable, private location, and he emphasized that the meeting was to work on future performance and not to punish A her. In the end, he was able to address Susan’s defensiveness and turned a meeting that could have gone very poorly into a productive exchange of information and ideas. 1 1 0 Summary Points 8 • Managers must possess several imporT tant skills to manage the performance of their employees effectively.S Managers need to serve as coaches, to observe and document performance accurately, to give both positive and negative feedback, and to conduct performance review meetings. • Coaching is an ongoing process in which the manager directs, motivates, and rewards employee behavior. Coaching includes several key functions such as giving advice about what is expected about performance and how to perform well, giving employees guidance so employees know how to improve their performance, providing employees with support without being controlling, and enhancing employees’ confidence and competence. Coaching must be based on a helping and trusting relationship. This is particularly important when the Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. 254 Part III • Employee Development supervisor and the subordinate do not share similar cultural backgrounds. • Managers need to engage in a complex set of behaviors to perform the various coaching functions. These include the following: establish developmental objectives, communicate effectively, motivate employees, document performance, give feedback, diagnose performance problems, and develop employees. • Managers’ personalities and behavioral preferences determine their coaching style. Some managers prefer to be drivers and just tell employees what to do. Others prefer to be persuaders and try to sell what they want the employees to do. Yet others adopt an amiable style in which feelings take precedence and urge the employee to do what feels right or what the employee feels is the right way to do things. Finally, others prefer to be analyzers and have a tendency to follow rules and procedures in recommending how to perform. None of these four styles is necessarily better than the others. The best coaches are able to change their styles and adapt to the needs of the employees. • The coaching process is ongoing and cyclical, and it includes the following five components: (1) setting developmental goals, (2) identifying the resources and strategies needed to achieve the developmental goals (e.g., securing resources that will allow employees to engage in activities to achieve their developmental goals), (3) implementing strategies (e.g., enrolling the employee in an online course), (4) observing and documenting developmental behaviors (e.g., checking on the progress of the employee toward the attainment of his developmental goals), and (5) giving feedback (e.g., providing information to the employee that will help him adjust his current developmental goals and guide his future goals). H I G G S , A N G E L A 1 1 0 8 T S • Observing and documenting performance in general and performance regarding developmental goals in particular are not as easy as it may seem. Time constraints can play a role when managers are too busy to gather performance information. Situational constraints may prevent managers from observing the employee directly. Finally, activity constraints may be a factor; when developmental activities are unstructured, such as reading a book, the manager may have to wait until the activity is completed to assess whether any new skills and knowledge have been acquired. • Observation and documentation of performance can be improved in several ways. These issues, which were described in detail in Chapter 7, include implementing a good communication plan that managers accept and establishing training programs that help managers minimize rater errors (i.e., rater error training); share notions of what it means to complete developmental activities successfully (i.e., frame-of-reference training); observe performance more accurately (i.e., behavioral observation training); and become more confident about managing employee performance (i.e., selfleadership training). • Documenting an employee’s progress toward achieving developmental goals and improving performance in general has several important benefits. These include the reduction of the manager’s cognitive load, the enhancement of trust between the employee and the manager, the collection of important input to be used in planning developmental activities in the future, and the development of a good line of defense in case of litigation. • For documentation to be most useful, it must be specific, use adjectives and adverbs sparingly, balance positives Performance Management, Third Edition, by Herman Aguinis. Published by Prentice Hall. Copyright © 2013 by Pearson Education, Inc. Chapter 9 • Performance Management Skills with negatives, focus on job-related information, be comprehensive, be standardized across employees, and be stated in behavioral terms. • Feedback about performance in general and about developmental activities in particular serves several important purposes. These include building employee confidence, developing employee competence, and enhancing employee involvement with the unit and theH organization as a whole. • The mere presence of feedback does notI mean that there will be positive effectsG on future performance. For feedback to be most useful, it must be timely, fre-G quent, specific, verifiable, consistentS over time and across employees, given , in private, and tied closely to consequences (e.g., rewards); address description first and evaluation second; A discuss performance in terms of a continuum and not in terms of dichotomiesN (i.e., more and less and not all or noth-G ing); address patterns of behavior and not isolated events; include a statementE that the manager has confidence in theL employee; and include the active participation of the employee in gen-A erating ideas about how to improve performance in the future. • In general, managers do not feel com-1 fortable about giving negative feedback.1 They may fear that employees will react 0 negatively because they themselves have been given negative feedback in the past8 in a way that was not helpful and do not T want to put their employees in the same situation, because they don’t like playingS god, or because they think they need to collect an onerous amount of information and evidence before giving negative feedback. When negative feedback is warranted, however, and managers refuse to give it, poor performers may get the message that their performance is not that bad. Eventually, the situation 255 may escalate to the point that the manager has no choice but to give negative feedback; the situation then becomes punitive, and feedback is not likely to be useful. For negative feedback to be useful, it must be given early when the performance problem is still manageable. • Supervisors play the paradoxical roles of judge and coach at the same time. These roles are assumed during the performance review meetings, which can include as many as six separate formal meetings: system inauguration, self-appraisal, classical performance review, merit/salary review, developmental plan, and objective setting. In most organizations, these meetings are merged into one or two meetings. It is most effective to separate the meetings so that employees can focus o…

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