Professional Documents
Culture Documents
Before Mid
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Acquiring People: Selecting the most suitable person to perform various job activities is called acquiring people. Training People: Teaching employees various skills required to perform the job activities is called training people. Appraising People: To evaluate the performance of people and to give them feedback is called appraising people.
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Compensating People: Providing financial and non financial benefits to the employees against their services or contribution for the organization is called compensating people.
Resources Approach: Every organization consists of three important ingredients/factors including Financial Resources Physical Resources Human Resources Where human are considered to be the most important resource as they (Human) are going to manage physical and financial resources as well, so studying about HRM practices contribute/develop the managers knowledge about how to manage the human resources more effectively.
Mistakes Approach: The basic knowledge about the HRM functions may provide the managers an insight/understanding about managing people more effectively and they should be able to avoid various mistakes while: Selecting the right person for the job Designing and conducting the training programs Evaluating the performance of employees and providing them with feed back Designing various compensation plans for the members of organization
Role of HR Department
We can understand the role of HR department by studying the following terms: Line Management Staff Management
Line Management:
The relationship between two parties where one party has the right to make and impose the decisions and the other party has to follow them, creating a supervisor-subordinate relationship. Line manager is that person who has line function Line Management/Line Function: the function of giving order to others Line Authority:
Staff Management:
The relationship between two parties where one party may suggest the other party about various aspects creating an advisory relationship Staff Manager: the person who has the advice function is called staff manager. Staff Function/ Staff Management: the function of giving advice to others Staff authority:
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Employees Advocacy:
The rule of HR Department with in an org. where they suggest the other department and employees regarding: Recruitment and selection procedures that may help in selecting the right person for the job Designing training programs to develop the employees to fulfill future requirements Making evaluations and feedback to keep organization on right track Designing compensation plans to retain the employees within the organization Managing employees relations through negotiations and dispute settlements
Strategic HRM
Strategy:
Long-term action plan based on a critical evaluation of internal and external factors to create competitive advantages. Long term plan SWOT analysis i. Internal SWOT: Strength and Weakness ii. External SWOT: Opportunity and Threats Competitive Advantages
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Strategic HRM
Aligning/matching the HR functions with the overall strategy of organization by considering all the legal and ethical issues.
1.
Business Proficiency:
An insight/ understanding about internal and external environment of the business that may be helpful for the manager s to design various policies for the organization
2.
Leadership Proficiency:
The managers should be aware about the basic techniques that how to provide others with guidelines and to motivate them to follow those guidelines. Indentify future directions for others
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Learning Proficiency:
Managers should continuously monitor their external environment to identify various changes to keep themselves updated about most recent trends. This will be helpful in adopting the changes which are desired by the firm and to ignore various characteristics/changes which are not beneficial for the organization.
4.
HR Proficiency:
The managers must have the knowledge about the basic HR functions including: Acquiring People Training People Appraising People Compensating People
Acquiring People
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According to this graph when we analyze the organization we see that in 2009 we hired 5 people but in 2010 we hired 10 people and in 2011 we hired 15 people. So according to this trend we have to hire 20 people for the year 2012.
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To identify the numbers of individuals required by determining the ratio b/w outputs and human inputs.
Organizations keep data tables like this one in their records and then on the base of these tables they decide their requirements.
Expert Analysis/Assessment:To determine the quantity of individuals required by the firm by obtaining opinion of experts who have been performing similar kind of job for a longer period of time. It is a subjective approach which is not easily justifiably as the opinion depends upon the personal judgment of that expert. If the organization has no past trends then trend analysis is not useable, if organization has no eligibility to find ratios then ratio analysis is not useable, and on this situation the organization will use expert analysis method by hiring to an expert.
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(ii)
(iii)
(iv)
(v)
(vi)
Work Activities Information regarding the activities and operations to be performed by the incumbent/individual who is responsible to perform that job. It may include the routinely and occasionally activities. For example for a student attending a lecture is a routinely activity and to give presentation is occasionally activity. Human Behavior/ Personality The information regarding the specific type of personality traits or the behavioral traits required to perform the mentioned activities, like confidence, trust worthy, etc. Machinery/Tools/Equipment The information regarding helping material and equipments that may facilitate the job performance and that are to be used by the job holder. For example, white board, multimedia etc. for a teacher. Performance Standards Information regarding the specific standards that should be observed by the job holder and that may be used during performance evaluation of employees. For example to report to college for lecture at 8:00 AM, or to produce various units. When we make specific to work activities that how to perform those activities, then this specification becomes performance standards. Like for a student the work activity is to study but when we make it specific that he will study during 9:00 am to 10:00 am, then it will become a performance standard. Job Content/Physical environment The information regarding the physical working conditions and specific objects like temperature, noise, pollution, office or field work, working within minus temperature etc. Skill requirements/ Job specifications The information regarding the specific qualifications and skills required by/in a human to perform a job like knowledge, expertise etc.
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(i)
(ii)
(iii)
Performance evaluation
The information regarding performance standards is helpful in comparing with actual performance with those standards to evaluate the employees accordingly.
(iv)
(v)
(vi)
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Process Chart: The graphical representation of various processes within organization that how input are converted in to output.
Step 6. Documentation
To write down all the information in a logical and comprehensive manners preparing to important documents to the organization
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i.
Interview:
Direct interaction b/w parties to discuss various issues under consideration Direct interaction Parties Issues under consideration/evaluation/selection/job analysis/interview
Types of Interview:
a. Structured b. Un-structured c. Semi-structured Interviews are costly and time taking.
ii.
Questionnaire:
A structured set of questions designed to obtain information from a number of respondents/ employees regarding specific issues. Structured Large number of respondents Information regarding specific issue
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Second most widely used method less costly and time taking. Used when information is required from a large number of employees/respondents.
iii.
Observation:
Directly monitoring the employees while performing their job obligations during specific time period/during a cycle time. Cycle time: observation is valid if an employees is being observed during Cycle time that is the time it takes to complete a job/ an activity/ a process from it starts till it ends. Reactivity Issue: There may be the specific problem in terms of biasness in individuals behavior due to observation from other parties that may be called as re-activity problem.
iv.
Participant Diary/Log:
Employees are provided with a note book or a digital assistant to record each and every activity performed during their job obligations throughout cycle time. This information is collected by the supervisors after completion of job and it is used to prepare job description and specifications after due verifications and authentications.
v.
Multiple Methods:
Using a combination of more than one method to collect information regarding job.
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Job Description
(How to write a job description) 1. 2. 3. 4. 5. 6. 7. 8. 9. Job identification Job summary Duties and responsibilities Performance and standards Working relationship/professional relationships Authority of jobholder Job context/physical conditions Helping material ( machines, tools, equipments) Human requirements.
1. Job identification:
All the information that helps in introducing a specific job and that is used to distinguish one job from the others.
2. Job Summary:
The assistant HR Manager is responsible to assist the HR Manager in performing HR activities/personnel activities, recruitment and selection, training and development, performance evaluation, management, compensation management and managing human relations.
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This is called the heart of job description and it contains a detailed list of work activities and operations that are to be performed by the job holder during its professional obligations including routine or occasional activities.
4. Performance Standards
The details about specific measures of performance or the standards that are to be maintained by the job holder as part of his duty. For example to meet with other employees to identify various issues at least five persons per day. (At least five persons per day is a standard)
5. Working Relationships
The details about various other parties that are to be contacted by the job holder as part of its job duty including supervisors, colleagues, subordinates or any other third party.
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8. Helping Material/Machines
The information regarding specific tools, machines or equipments that are to be used within job
9. Human Requirements
A list of skills and experience, qualifications and abilities and expertise that are required for the specific job activities/obligations.
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Job Rotation:
Continuously and systematically moving an employee from one job place to another to enhance its understanding about the job and to assess its capabilities regarding various work activities.
Job Enrichment:
All the procedures or arrangements used to develop employees capabilities or to increase their contribution for the organization may be termed as job enrichment. For example increase the spam of control - Assigning decision making authority - Job rotation to enhance understanding etc.
De-Jobbing:
(To do job informal)
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Effectiveness of Recruitment:
The effectiveness of recruitment efforts is measured in terms of:
Quantity:
What number of applicants applied for the specific job position announced by the organization? The higher the number of applicants, the recruitment will be considered more effective.
Quality:
What is the number of eligible candidates who are fulfilling minimum job criteria and who possess the required skills, expertise and abilities that are included with in job specifications?
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Sources of Candidates
(1) Internal Sources (2) External Sources To identify the sources from where the organization may attract the suitable candidates to apply for the available job positions.
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1. Job Posting:
Posting a job on the notice board of the organization along with its brief description and specifications to encourage the employees to apply for those positions. It may include: (i) Posting job on notice board (ii) Sending an official email or memo to employees (iii) Publishing the availability of job on official website
2. Re-hiring:
Re-selection of the employees whose terms and services with the organization have been expired for another period of time. It includes: (i) Renewal of contract after its maturity (ii) Reassignment of projects after they are completed
3. Succession Planning:
The procedure to identify the future human requirements of the organization and to select and develop current employees to fulfill future requirements.
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(2)
1. 2. 3. 4. 5. 6. 7. Advertising Employment Agency On demand Recruiting Services Temp Agency Referrals Walk-ins College Recruiting
External Sources
1. Advertising:
The procedure and practices that are used / adopted by an organization to convey the outsiders about availability of positions within organization along with a brief description and specification about the job. (i) Selection of Media: ( print, electronic, personal advertisement) The organization should prefer to select the most appropriate channel to convey the information to the outsiders that may include personal communication, communication through print resources or electronic resources. (ii) Construction of Ad/Advertisement: The organization should be careful while designing advertisement for the job positions following a four step procedure called AIDA plan. a. Attention b. Interest c. Desire d. Action a. Attention: Anything which can attract our attention for example any model, actor etc. b. Interest: Attractive salary, bonus, other facilities etc c. Desire: When we will feel interest then there will be a desire for getting that job. d. Action: When we will feel a desire for getting a job then we will take an action in the form of applying for that job.
AIDA Plan
The organizations should try to /consider attracting external candidates by constructuring the most suitable advertisements that may create the interest of candidates and they would desire to apply for the job and this desire may be converted into action by providing the necessary contact details, (telephone, office address, email etc.)
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Various organization either public or private that provide specialized recruitment services to the organizations to facilitate them during the recruitment and selection procedure and to help them hiring the most suitable person for the job. Employment agencies are preferred by the organization if: (i) The organization does not have occupy the human resource department (ii) The HR department is not very much effective in hiring the suitable candidates (iii) It is time and cost effective to consult the employee agency (iv) The organization failed to conduct recruitment procedures in past
4. Temp Agency:
The outsourcing agency that provides other organizations with temporary workers to work for various projects and assignments as a member of the hiring organization. For example a security guard of a security company is working in a bank.
5. Referrals:
The candidate who are recommended by existing/current employees of the organization or various authentic resources with the basic assumption that good people know good people.
6. Walk-in:
The individuals who tends to show their interest for the organization by applying personally or electronically even if there are vacant positions within organization or otherwise.
7. College Recruiting:
Attracting and inviting suitable candidates among the graduation classes of a college or university to find out fresh graduates to fill vacant positions within organization. (i) College Recruitment: College recruitment may be done through: a) On Campus Visit: The setup where the representatives of the organizations tend to visit the university campus to attract suitable candidates among students. (In this type the representatives comes to university) b) On site visit: The setup where students are invited to Visit Companys office or plant/factory to attract them to apply for various positions within organization. c) Internships: The specific setup where students are provided with an opportunity to secure the organization and to perform actual job duties for a limited period of time to attract them for the permanent employment.
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Tests of investigations
Test: taking the sample of an individuals behavior to predict its future performance.
Tests of investigations
Test: taking the sample of an individuals behavior to predict its future performance.
Type of tests
1. 2. 3. 4. 5. Tests of intellectual abilities Tests of physical abilities Work sample tests Tests of personality Achievement tests
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for the job. (Person job fit). For examples MAPS, inkblot tests, sentence completion, clouded picture tests etc.
5. Achievement test:
the type of test that is conducted to identify what an individual has learnt from its past job experience. For example midterm exams, final exams etc.
Purpose:
To verify the provided information To identify the concealment of facts and information To determine some harmful information for the organization
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Selection Interview:
Direct interaction between an employee and candidate to determine the suitability of that individual for job/organization
i.
ii.
iii.
Job understanding:
The interviewers must be appointed who can be considered as subject matter experts and who are familiar about the requirements of the job, understand the duties and responsibilities and know about the human specifications required to perform the job activities.
iv.
v.
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vi.
The interviewer should not facilitate the candidates by providing them positive impressions or hints regarding the interview contents/questions or by adopting a behavior that is too much strict or lenient.
Types of Interviews
1. Based on construct
i. Structured interviews ii. Unstructured interviews iii. Semi-structured interviews
2. Based on contents
i. ii. iii. iv. i. ii. iii. iv. v. vi. Situational interviews Behavioral interviews Stress interviews Job related interviews Individual interviews Panel interviews Group discussion Mess interviews Sequential interviews Other types
3. Based on settings
1. Based on Construct:
Classification of an interview o the bases of the structure, or construct whether the type and number of questions have already been decided or otherwise.
i.
ii.
iii.
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2. Based on contents:
The classification of an interview on the basis of the type of questions that are included with in an interview (that should be asked from the candidates) is as following:
i.
ii.
iii.
iv.
3. Based on Settings:
The classification of an interview on the bases of style of administration and physical settings in which the interview is being conducted.
i.
Individual interview:
The setting in which a single interviewer is going to conduct the interviewer for individual candidates.
ii.
Panel interview:
The interview in which a group of the interviewers is appointed to conduct the interview for individual candidates. The panel may comprise of: H.R. Personnel Experts/Externals Supervisor/Dept. Head
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iii.
Group Discussion:
The settings where a group of candidates is assigned with a specific topic to discuss with each other and they are being evaluated by the interviewer on the bases of their contribution and the quality of arguments.
iv.
Mass Interview:
The settings where a panel of interviewers is appointed to conduct the interview for more than one job candidates at the same time. Mass interview is the combination of panel and group interview.
v.
Sequential Interview:
The settings where a candidate has to go through a series of interviews based on: a. Time intervals (for example one interview is today, 2nd is after 3 days and so on.) b. Level of Organization (for example first supervisor will take interview, then manager, then head of department etc.)
vi.
Other Types:
a. b. c. d. Computerized interviews Online Interviews Distance Interviews Web-based interviews (with the help of web-cam)
Employment Selection
The process of hiring the right person for the job after careful planning and recruitment and after applying the most appropriate screening techniques including tests, investigations and interviews.
ii.
Effectiveness/Achievement of Goals:
The organization has to achieve its targets through an effective use of its human resources so the individuals must be selected who have capabilities and skill to drive the organization towards the right direction.
iii.
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Negligent Hiring
If the organization fails to select the right person for the job and it becomes harmful for the organization, the specific condition may be called as negligent hiring. Negligent hiring may include: i. Mistakes while employment planning ii. Errors while recruiting the candidates iii. Designing and conducting in-appropriate screening tools (tests, investigations, interviews,)
Training People
Employee Orientation:
All the procedures that are adopted to make an employee aware about the organization, its policies and various other perspectives regarding the job. Why orientation is important/provided? i. To welcome to the employees to the organization. ii. To make the employees at ease so they can start the socialization process. iii. To make them aware about the organization. iv. To provide information about the history/past, present condition and future vision of the organization. v. To inform about the facilities that can be enjoyed by an employee being the member of the organization. vi. To provide awareness regarding rules, regulations and procedures that should be followed/observed. vii. To make them aware about the specific code of conduct or behaviors that is expected from the employee.
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iii. Policies and Procedures/ Rules and Regulations: The specific characteristics or procedures that should be followed by an employee to perform its work activities. iv. Code of Conduct: The information/detail regarding the specific behaviors that are expected from the employee. v. Facilities/Supports: What specific facility may be enjoyed by the employee as a member of organization for example Wi-Fi, transportation, Library etc? vi. HR. Information: The details regarding the HR functions including training/development, performance evaluation and employee compensation. vii. Safety and Security Measures/Precautions: The detail regarding the precautions and safety measures that should be observed by an employee.
Training
Teaching employees various skills required to perform their job activities and to develop them according to the requirements of organization.
Coaching:
The training program that is designed to enhance professional skills of an employee and to develop its capacity to perform job related tasks. For example making adjusting entries for an account officer, new product development training for a marketing executive etc.
Consoling:
The training program that is designed to enhance personal skills of an employee and to develop its capacity to solve/resolve individual conflicts and emotional problems.
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v. Explain precautionary measures that should be considered while performing job. For example do not smoke while driving.
Motivation Guidelines:
How to keep employee motivational to the job? i. Explain the perceived training need to the employee to make them motivated towards the training program. ii. Follow the learning by doing technique and involve the employees in to the actual activities of the job. iii. The trainer should provide the employees with positive reinforcement, timely feedback and prompt/immigrate suggestions regarding their job activities. iv. The trainer should consider the learning capacity of the trainees and allow them to learn the job according to their own pace/speed of learning. v. The trainer should observe the schedule of the training program and the training should be provided during the early hours of the days as the learning tendency/curve decreases throughout the working day.
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deficiencies and to determine whether this efficiency can be removed through training or there may be other solution. Process of Performance Analysis Step 1: compare the actual performance with the standards Step 2: Identify various performance deficiencies Step 3: Design training objectives to remove the deficiency or taking other corrective actions
2. Instructional Design
The process of deciding about the specific materials, information and contents that should be convey to the employees, as well as making decisions regarding the methods that should be used to convey the training information. Contents of Instructional Design: Making decisions regarding the specific information that is useful for the employees and that should be convey them including all the materials, workbooks, exercises, assignments or practical exposure/experience. For example course contents of a student.
Methods
The specific techniques or physical settings that should be used to convey the training information to the employees and managing the training contents accordingly. 1. On the Job Training (OJT) 2. Off the Job Training
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Methods of OJT
i. ii. iii. iv. v. vi. Coaching Rotations Special Assignment/Action Learning Job instructions Training Informal learning Apprenticeship On the job training method where an individual is assigned to a supervisor or a subject matter expert to learn various job related skills by taking guidelines and directions and by consulting in case of various problems.
i. Coaching:
v. Informal Learning
On job learning where individuals tend to learn various job activities using informal setups from their colleagues, supervisors or sub-ordinates other then than organization. The organization may encourage the informal learning within the organization by providing facilities and support.
vi. Apprenticeship
On the job training technique where an individual is assigned to an expert/craft man to learn various job related skills by dedicating its time and efforts to achieve the training objectives.
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i.
ii.
iii.
Management Games
Off the job training exercises in which an individual employee or a group of employees tend to compete with each other regarding various job related practices and to enhance their skills. a. Role Playing Exercises: Off the job training exercise that include specific set of activities assigned to an individual to develop its capabilities for example role of investor b. Behavior Modeling Exercises: Various training exercises that are designed to modify the behavior of an employee according to the requirements of the organization by following various re-enforcements.
iv.
Simulations
Off the job training equipments that are exactly similar to the actual job environment designed to train the employees for various jobs that are risky in terms of monitory resources, physical resources or loss of life, for example to jump from a plane, flying etc.
v.
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i.
Reactivity:
The response of employees towards training contents and methods assuming that a positive word of mouth is the predictor of success of training program.
ii.
Learning:
If the employee acquires new knowledge, skills and abilities due to the implementation of training program, it may be considered success of that training.
iii.
Behavior:
If an employees on the job behavior has been changed positively after the implementation of training program, that training may be considered successful.
iv.
Results:
If there is a positive improvement in the operational output of an employee and its productivity has been increased the training may be considered to be successful/effective.
Negligent Training
If the managers failed to train their employees according to the requirements and training was unable to achieve its objectives and it may be harmful for the organization, its members and other stakeholders, this training will be called negligent training. Negligent training may include: i. Wrongful need assessment ii. In-appropriate contents and methods iii. Errors while validating the training program iv. Any other relevant mistakes.
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Appraising People
1. Performance Appraisal 2. Performance Management
1. Performance Appraisal
All the procedures that are designed to compare the actual performance of an employee with the performance standards and to provide with feedback along with suggestions and reenforcements. Process of Performance Appraisal i. Setting standards ii. Compare actual performance with the standards iii. Providing feedback along with suggestions and re-enforcements.
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Why performance appraisal is important? OR Importance of performance appraisal i. It provides the employer an exact idea about the actual performance of an employee with in organization ii. It is an integral/importan part of overall performance management system. iii. Most of the employers make their rewards and promotion decisions on the actual performance of the employees. iv. It helps an employer to suggest future develompent for an employee according to its performance. v. An employer may provide the employee with suggestions and re-inforcements for its improvement.
i.
Strategic Appraisal:
The management should ensure that an employees performance is contributing towards achievement of its overall strategy to determine various performance improvements that are beneficial for the organization.
ii.
iii.
Supervisors Role:
The management should consider involving the immediate supervisor in to the process of an employees evaluation to make it more reasonable as the supervisor has an exact idea about an employees performance and its expertise.
iv.
Realistic Appraisal:
The management should be neutral while evaluating the performance of an employee and they should convey the actual situations of an employees performance including various efficiencies and deficiencies.
v.
Feedback:
The organization should consider providing timely feedback to the employee along with suggestions and re-enforcements to make improvements accordingly.
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Appraisal Interview
Satisfactory:
For example to for being passed in exams of a semester there is required 1CGPA but for being promoted in next semester 2CGPA is required. Now if a student gets more than 2CGPA, his performance is satisfactory and promotable, but if a student gets less than 2CGPA but more than 1CGPA, his performance is satisfactory but not promotable.
Un-Satisfactory:
For example an employee does not show satisfactory performance, and then management will decide about his performance. If his mistakes are correctable, then they will give him suggestions for improvement, and if his mistakes are not correctable, then management will ask him bye bye.
i.
Supervisor:
The type of evaluation where an employee is being evaluated by its immediate supervisor or the senior authorities considering that the supervisor has an exact idea about an employees performance, skills, efficiencies and various other aspects. The supervisors evaluations are most vilely used and considered effective than other methods. Self Rating: 25-40% bias The type of evaluation where an individual employee tends to rate its own performance y using the given criteria as directed by the organization. The self ratings may prove to be biased as the individuals tend to rate themselves higher than their actual performance.
ii.
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iii.
iv.
v.
vi.
Appraisal Problems
i. ii. iii. iv. v. vi. vii. viii. Problems because of which appraisal becomes useless are as following. Un-Clear Standards Halo Effect Recency Effect Outside/Third party Influence Leniency Strictness Central Tendency Biasness
i.
Un-clear Standards:
If the standards and targets are not cleared to the employees it may crate various ambiguities for both the employer and the employees.
ii.
Halo Effect:
If an employer tends to evaluate various individuals on the bases of a few dominant characteristics of its behavior instead of considering its overall personality and performance.
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iii.
Recency Effect:
Tendency of an evaluator to rate the employees on the basis of considering its overall performance throughout the evaluation period.
iv.
v.
Leniency:
Tendency of an individual to rate various employees higher than their actual performance may be called as leniency effect.
vi.
Strictness:
Tendency to rate the employees below than their actual performance may be considered as the strictness effect.
vii.
Central Tendency:
Tendency of an employer to evaluate the employees on average basis without considering their actual performance including all the achievements and drawbacks.
viii.
Biasness:
If an employee is being evaluated under the influence of personal demographic characteristics it may be considered as Bias. The personal characteristics may inc lude age, gender, social class, religion, race, etc. For example ( chorro yaar apna aadmi hy.)
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Appraisal Method
The specific proceeds or techniques used by the organization to evaluate the performance of their employees and to provide them feedback accordingly. It includes two important decisions. i. What to measure? ii. How to measure?
Performance Dimensions
The decision regarding specific indicators or characteristics of the job that may be used as the base for performance evaluation for example quality, job knowledge, time etc. The performance dimensions may be categorized in to four different types. i. General Dimensions ii. Specific Dimensions iii. Competencies iv. Goal Achievement
i.
ii.
Specific Dimensions:
The type of indicators that are not common and that may exist for certain kind of job or designation. For example marks for students, vouching for an accountant, sales plan for a marketing officer etc.
iii.
Competencies:
The type of performance indicators through certain employees are evaluated on the bases of certain job related skills including conflict management skills, customer relation management skills, using software etc.
iv.
Goal Achievement:
The performance indicator that include the specific qualitative targets that should be achieved by an employee during the course of its job. For example meeting 10 customers per hour, attending 30 calls per day etc.
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Decision regarding specific methods that should be used for an employees evaluation and to provide with feedback. i. Graphic Rating Scale ii. Alternative Ranking Method iii. Forced Distribution Method iv. Paired Comparison v. Critical Incidents Method vi. Narrative Forms vii. Management by Objectives(MBO) viii. Behavioral Anchored Rating Scale (BARS)
i.
Good
Excellent -
ii.
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The evaluation criteria where an employee is evaluated according to the specific distributions designed and implemented by the organization. Students Marks Ranking A 88 Above 20% B 82 C 80 Above 60% D 76 E 73 Poor 20%
iv.
+ + -
+ + -
+ + +
1 2 2
3 2 2
v.
vi.
Narrative Forms
Evaluating the performance of an employee and providing with feedback using the specifically designed or descriptive documents that include both the performance evaluation as well as the recommendation.
vii.
Management by Objectives(MBO)
A systematic procedure designed by the organization to identify individual departmental and organizational objectives and to evaluate the performance of an employee against the objective. Step 1: Identify organizational objectives Step 2: Determine department/group objectives Step 3: Clarify individual Objectives Step 4: Evaluation Step 5: Feed back
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viii.
Compensating People
All kinds of financial and non-financial benefits offered to an employee in exchange of its services for the organization. The employee compensation may include: i. Direct Financial Payments ii. In-Direct Payments iii. Benefits in Kind iv. Non-Financial
i.
ii.
In-direct Payments:
All the payments made to third party for whom the benefit is enjoyed by the employee like insurance, medical treatment fee, etc.
iii.
Benefits in kind:
All the tangibles or facilities offered to an employee to facilitate its job performance and to encourage its contribution, for example computer, tools and equipments etc.
iv.
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i.
ii.
Increments/Pay Raises:
The permanent increase in basic pay of an employee that becomes a part of its salary arrangement for the next compensation period. Increments may be offered either on the bases of superior performance or on the bases of duration of time with in a specific organizations. a. Increments based on performance/merit raise b. Increments based on seniority
iii.
Allowances:
The additional cash amount offered to an employee to adjust individual differences or to encourage an employee on the bases of certain characteristics. For example entertainment allowance, traveling allowance, senior post allowance etc.
iv.
v.
Benefits/Fringe Benefits:
The facilitation or support offered to an employee in terms of tangible and non tangible benefits including member ship of professional organization or sight fitness centers and residence etc.
vi.
vii.
Commission:
A percentage of sales amount offered to an individual who has contributed its efforts in making that sale possible.
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i.
Legal Issues:
It includes all the binding and restrictions imposed by the federal or provisional authority governing the pay rates or various other facilities. For example including minimum wage rate, overtime pay, paid leave, old age benefits etc. For example any company cannot pay to its employees less than Rs. 9000 in Pakistan because of restriction of the government.
ii.
Labor Unions
The compensation decisions may also be effected by the groups of employees within organization that are formally designed to protect the rights of employees. The labor union may affect the compensation decision through collective bargaining or using various other techniques like protest, strike, lock outs, etc
iii.
Company Policy:
The organization may design various policy matters or strategies to compensate their workers according to their nature of job, skills, or contribution for the organization. The companys policy may include decision regarding various allowances, benefits or commission based pay plans etc.
iv.
Equity Issues:
Various factors that are introduced by the competitors or the other organization may also force the management to design competitive pay plan that is adjustment in pay rate according to the compensation offered by the other firm. The equity issue is important to retain the employee within the organization and to reduce employees turnover.
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Employee Incentives
Various ingredients that are offered to an employee as compensation to motivate them for future performance and to recognize their efforts for the organization. Employee incentives may be categorized in to two types. i. Individual incentives ii. Group/organizational incentives
i.
Individual Incentives:
a) Piece work c) Merit Pay/Raise b) d) Commission Recognition
(b) Commission:
Additional cash amount offered to the sales person against each unit sold by that individual.
ii.
Group/Organizational Incentives
a. Employee stock ownership program c. Gain sharing Plan b. d. Profit sharing Plan At-Risk Pay Plan
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