UMGC Pay For Performance Compensation Model and Performance Appraisal Discussion This is a two part discussion, using the resources provides please respond

UMGC Pay For Performance Compensation Model and Performance Appraisal Discussion This is a two part discussion, using the resources provides please respond to the following questions to include in-text citation per response. APA format. Attachments are below.

The format for the response is

Discussion 1

a.

b.

Discussion 2

a.

b.

Discussion One:

a) Discuss the benefits, challenges and tradeoffs of pay-for-performance, or merit pay. How would a pay-for-performance policy support the organization’s strategic goals? What factors should be considered in evaluating the effectiveness of this practice?

b) Select three methods for conducting an evaluation of an employee’s performance and discuss the advantages and disadvantages for each method. Discuss what level of employee (management, administrative, clerical, laborer, etc.) you would use each method to evaluate.

Be sure to use in-text citation and provide the references for the sources of the information used.

Discussion Two:Application

Read the Module 4 Case and scenario 1. After reviewing the module material, answer the following taken from the module:

The acting head of software development advises you that she wants to develop an effective performance appraisal system for her department. She remembers, from having taken a human resource management class as an undergraduate, that there are a number of different ways to measure performance and she wants your guidance in selecting one.

She also wants to make sure that the method chosen to measure performance fits the technical nature of the workers she supervises who work in teams. Knowing what an individualistic society the USA is, she suggests there be an individual and a team component.

a) Discuss the different alternatives that you recommend as the most effective for measuring the performance of software developers working in teams. Share at least three alternatives with the pros and cons of each alternative you suggest.

b) Answer/discuss the following: 1) What information will need to be gathered to develop the new appraisal system; 2) How you will make the performance appraisal job-related and valid; and 3) How you will mitigate the risk of rater errors when evaluating performance.

Be sure to use in-text citation and provide the references for the sources of the information used. Week Six References:
Required reading/viewing
Appraising Employee Performance (see content).
Heathfield (2019). The 5 Goals of Employee Performance Evaluation. Retrieved
from https://www.thebalancecareers.com/employee-performance-evaluationgoals-1918866
Bacal (nd) “A Performance Management Bias and Error Glossary” (HTML) The
Performance Management and Appraisal Resource Center : Retrieved
from http://performanceappraisals.org/Bacalsappraisalarticles/articles/bias.htm (Very brief definition of
terms that affect performance management)
Heathfield (2019). Common Problems with Performance Appraisals. Retrieved
from https://www.thebalancecareers.com/performance-appraisal-problems1918857/
Lumen Learning (nd). Performance Appraisals Retrieved
from https://courses.lumenlearning.com/wmintrobusiness/chapter/readingperformance-appraisals/
Performance and Rewards
Heathfield (2019). The Advantages and Disadvantages of Merit Pay. Retrieved
from https://www.thebalancecareers.com/the-advantages-and-disadvantages-ofmerit-pay-1919083
Petersen (2019). Advantages and Disadvantages of Pay-for-Performance Policies.
Retrieved from https://smallbusiness.chron.com/advantages-disadvantagespayforperformance-policies-44264.html
HR Basics: Performance and Rewards. Retrieved from

Preparing for Performance Reviews
How to do Effective Performance Appraisals. Retrieved from

Recommended reading
Heathfield (2019). Performance Management Process Checklist. Retrieved from
https://www.thebalancecareers.com/performance-management-processchecklist-1918852
Heathfield (2019). Are Annual Performance Reviews Enough to Ensure Employee
Success? Retrieved from https://www.thebalancecareers.com/performanceappraisals-dont-work-1918846
Lumen Learning (nd). Designing a High Performance Work System. Retrieved
from https://courses.lumenlearning.com/principlesmanagement/chapter/16-6designing-a-high-performance-work-system/
Case for Module 4
You have been the human resources manager for Human Solutions Software for six months.
These first six months have been difficult at times, with you needing to develop your credibility
with the people who work for HSS.
There have been some major changes at HSS since you became the human resources manager.
A West Coast branch office, which has 25 new employees, has been set up for HSS in Portland,
Oregon; and the former chief of operations has moved to Portland to head that new office. HSS
has also received a major contract with a German firm. That contract is being managed from the
main office in Maryland now, but a European branch office will be opened in the next few
months. The German contract has led to the hiring of an additional six employees at HSS
headquarters, with four of those employees planning to move to Europe when the branch office
opens there.
HSS has also received several new contracts, mostly with private firms, that have led to an
additional expansion of 18 more employees at the HSS headquarters. This means that HSS has
expanded from 65 employees, when you first started as the human resources manager, to 114
employees now.
As human resources manager you have hired a consultant who has conducted job analyses for
all the present positions at HSS. The founders at HSS have finally begun work on a strategic plan
for the organization and see you as one of the lead people in developing that plan. You have also
set up standardized recruiting and staffing procedures that have been used to hire many of the
new employees at HSS.
The hardest part of your job has been convincing several of the founders that these changes
were needed. The demands of the organizations that HSS contracts with, and several threatened
lawsuits by potential or former employees, have helped you to get these changes approved by
the board.
You have accomplished all of this with only one clerical person to help you. Recently you have
been putting pressure on the board to hire two human resources generalists to help you in your
tasks. You have justified this expense by the money that the organization can save by avoiding
lawsuits, by doing more training internally, and by being more efficient in recruiting and staffing
positions.
Two months ago you submitted a plan for reorganizing HSS based on the job analyses. This
structure included a traditional board of directors (made up of the five founders), a
president/CEO, five vice presidents (finance, operations, marketing, technical services, and
human resources). This morning you found out that, with a few minor revisions, your plan has
been accepted. You will be the new vice president of human resources with the two human
resource generalist positions being approved also. The founders have also given you the
responsibility to supervise the five personnel who administer and provide quality control for
contracts that HSS has.
While you are excited about your new position and the success of HSS, you are aware of all the
work that is ahead of you now. You see HSS as an organization that must be led into being a
more mature organization, with more established employee policies. One of the first things that
you plan to have your new HR generalists do is to work on organizing all of the employee policies
at HSS into an employee handbook. You also feel a need to update and review the benefits
policies for employees.
Scenario 1
One of the many things on your list of things to be done to help bring HSS into being a
more mature organization is to implement a formal performance appraisal system.
The acting head of software development advises you that she wants to develop an
effective performance appraisal system for her department. She remembers, from
having taken a human resource management class as an undergraduate, that there are
a number of different ways to measure performance and she wants your guidance in
selecting one.
She also wants to make sure that the method chosen to measure performance fits the
technical nature of the workers she supervises who work in teams. Knowing what an
individualistic society the USA is, she suggests there be an individual and a team
component.
A) Discuss the different alternatives that you recommend as the most effective for
measuring the performance of software developers working in teams. Share at
least three alternatives with the pros and cons of each alternative you suggest.
B) Answer/discuss the following: 1) What information will need to be gathered to
develop the new appraisal system; 2) How you will make the performance
appraisal job-related and valid; and 3) How you will mitigate the risk of rater
errors when evaluating performance.
Appraising Employee Performance
One of the most stressful times of the year at work for many employees is when they have their
annual appraisal. Appraisals are also a very stressful time for many managers. If appraisals are
done properly, they should not be a stressful time for anyone. Making appraisals effective and
relaxed involves constant, day-to-day effort.
Too many organizations and managers see appraisals as a one-shot, once-a-year effort. Effective
appraisals involve a constant management presence so that the managers are aware of what the
employees are doing and the employees are aware of what the managers expect. It seems to be
common sense that if we want employees to produce more, we should let them know what they
are doing right and what they can improve. If managers are constantly present, they can be
providing constant consultation for the employees rather than giving criticism and praise only
once a year.
Appraisals may be ineffective for a number of theoretical reasons:
•
Appraisals are often based on the assumption that the employee has had adequate and
proper training. It may be unfair for the organization to criticize the individual if the
organization has not provided that training.
•
The quest for good appraisals, especially if those appraisals are associated with raises or
promotions, can become a political quest by employees. In this case, the employee who
is rewarded is not always the employee who performs best; it may be the employee who
knows how to work the organizational politics best.
•
Some of the performance of positions in organizations is dependent on the performance
of other individuals. This may lead to an individual being criticized, or praised, for things
over which the individual has no control.
•
Appraisals emphasize the contributions of individuals over the performance of the
organization or team. This can lead to individual actions that make that individual look
good at the cost of overall productivity.
In reality, employees need feedback to perform at their best. Broadly interpreted, appraisals
provide that feedback. Among managers and employees, however, the word appraisal has come
to mean the more formal aspects of that feedback. One of the reasons for this is the need to
keep records that satisfy legal needs.
Legal Considerations with Appraisals
Appraisals are formal documents that go into an employee’s record. This makes them important
documents whenever there is a question as to the employee’s performance.
Many managers give good appraisals to avoid conflict with employees, especially if they believe
that a particular employee would create conflict if he or she were to receive a poor appraisal. It
is a common occurrence in organizations for an employee to receive good appraisals but then
have to be disciplined for poor performance. If the employee contests that discipline, the
organization is in a very difficult legal position because the formal appraisals do not support the
discipline.
Appraisals are also important documents when dealing with EEO considerations. It is important
that all managers who are doing appraisals receive training in EEO and diversity issues and are
aware of all EEO laws and regulations. Legal issues with EEO are more likely to be an issue if
there is an overall trend for any of the protected statuses to have lower, or higher, appraisal
scores than the organization’s nonprotected-status employees.
To be legally sound, appraisals must:
•
•
•
•
•
•
•
•
•
•
be objective
be uniformly applied
be job-related
be specific to the individual
be specific as to the behaviors being assessed
be done by a supervisor who is familiar with the employee’s performance
be communicated to the employee
give the employee access to the appraisals
provide for employee comments on the appraisal form
have a defined appeal process
Ways to Measure Performance
A number of ways have been developed to measure performance and communicate the results of
that measurement to the employee.
One of the most common performance appraisal measurement methods uses categories. Using
the graphic rating scale, the supervisor places the employee’s performance level on a scale
that is often based on a 1-to-5 or a 1-to-7 continuum. Different tasks or performance
expectations are listed, and the supervisor evaluates the employee on how they “rate” on each
task or expectation. Another category rating method is the checklist, in which the supervisor
checks the statements in a list that apply to the employee. These methods are popular because
they are quick and easy for the supervisor, and they require less training of the rater than other
methods.
Other methods compare the performance of employees. The ranking method ranks all of the
employees from highest to lowest, either on specific job functions or on overall performance. The
forced distribution method usually uses a bell-shaped curve to make sure that only a few
employees are rated at the highest and lowest levels, with most employees being rated
somewhere in the middle. The paired-comparisons method is similar to a tournament ranking
in sports. Individuals are paired against each other, with the better-performing individual being
compared with another better-performing individual until a determination of the best-performing
individual(s) is (are) obtained.
Managers are required to write an evaluation of the individual performance in the essay
method. While the essay method can be more effective in communicating strengths and
weaknesses of the individual’s performance to the individual, essays are not easily quantified and
so are less useful in comparing employees in the organization or in proving that legal
requirements have been met. The critical-incident method requires raters to write a
statement when something favorable or unfavorable happens with the employee’s performance.
The accumulated statements can be used in an overall appraisal of the employee’s performance.
Behaviorally based methods usually involve the rater either writing observations of an
employee’s specific behaviors in defined areas or the rater rating how the employee performed
on different dimensions of the job as defined by behavioral statements. Behaviorally based
appraisals provide insights to an employee’s performance but are difficult to develop and
validate. There may be legal problems in using behaviorally based appraisals if those appraisals
do not have validated anchors that are job-related.
Management by objectives (MBO) is designed to be a method of managing employees but
may be used effectively as an appraisal method. In MBO, the supervisor and the employee set
specific and measurable objectives for the employee to achieve. The objectives should be related
to the overall organizational goals and the employee’s function in that organization. Because the
goals are specific and measurable, they provide a benchmark to see if the employee is
performing as was agreed upon by the employee and his or her supervisor. The most difficult
part of MBO is in the original setting of the objectives. MBO may also be difficult to implement for
employees who have goals that are difficult to measure.
Potential Rating Errors
One of the major problems in organizations is that the organizational culture affects how ratings
are viewed. In the leniency effect, the appraisal process may be seen as having a potential for
conflict between the supervisor and the employee. In many organizations this leads to the
supervisor giving everyone very high ratings to avoid conflict. This means that the appraisal is
not very effective because it does not give an honest rating of the employee’s performance.
In some organizations the opposite occurs, causing a severity effect. The managers want to
give employees a reason to improve and build a paper trail in case an employee must be
disciplined, so they tend to give everyone low ratings. A related concept is the central
tendency effect, in which the rater tends to rate employees toward the middle of the rating
scale to avoid any extremes. When central tendency occurs, everyone in the organization tends
to be rated as average, even if they have performed superbly or poorly.
Other rater problems are the recency effect and the primacy effect, in which the most recent
performance or the first performance observed has too high a weight in the rater’s appraisal of
the employee. The halo effect and the horns effect occur when a rater lets an employee’s
good or bad performance on just one aspect of the job affect the overall rating they receive on
their appraisal.
The most damaging rater errors occur when raters allow bias to creep into their ratings of
employees. This bias is often unintentional, and raters are often unaware of their bias. The bias
can be expressed in terms of stereotyping individuals who are members of a protected status
as fitting an impression that the rater has of people who are members of that protected status.
This bias may show up in ways such as, for example, the rater seeing women as not being good
at decision-making, or Vietnam veterans as being mentally unstable. A bias may also show up
when a rater subconsciously rates people higher if they look and act like the rater. It can also
occur if an organization pushes a supervisor to have employees who look and act a certain way
or “fit” the organization’s image. There are many cultural and organizational biases that raters
may have to be aware of so they can be sure they are not basing their employee appraisals on
these biases.
One of the best ways to protect against potential problems with employee appraisals is to have
well-defined and job-related elements that a rater can use for the appraisals. Another good
strategy is to have well-trained raters.
Formal performance appraisals are important for legal and organizational reasons. The most
effective way to do appraisals is to have informal communications between managers and
employees on a regular basis. If the frequent informal appraisals are effective and are conducted
by well-trained managers, the formal and legal aspects of an appraisal system will easily follow.

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