PERFORMANCE MANAGEMENT & COMPETENCY MAPPING

MODULE 1:
INTRODUCTION

Definition: Performance management is a continuous process of identifying, measuring and

developing the performance of individuals and teams and aligning performance with the
strategic goals of the organization .

Let’s consider each of the definition’s two main components:

1. Continuous process: Performance management is onging process of setting goals and

objectives, observing performance & giving & receiving ongoing coaching & feedback.
2. Alignment with strategic goals. Performance management requires that managers
ensure that employees’ activities & outputs are congruent with the organization’s goals
& consequently, help the organization gain a competitive advantage. PM therefore
creates a direct link between employee performance & organizational goals & makes
the employees’ contribution to the organization explicit.

The performance management contribution:

There are many advantages associated with the implementation of performance management
system. Implementing a well-designed performance management system has many
advantages. From the perspective of employees, a good system increases motivation and self-
esteem, helps improve performance, clarifies job tasks and duties, provides self-insight and
development opportunities, and clarifies supervisors’ expectations. From the perspective of
managers, good systems allow them to gain insight about employees, allow for more fair and
appropriate personnel actions, help them to communicate organisational goals more clearly, let
them differentiate good and poor performers, and help drive organisational change. Finally,
from the perspective of the HR function, a good system provides protection from litigation

Dangers of poorly implemented PM systems:

What happens when performance management do not work as intended. Consider the
following list:

1. Increased turnover. If the process is not seen fair, employees may become upset &leave
the organization. They can leave physically (i.e. quit) or withdraw psychologically (i.e.,
minimize their effort until they are able to find a job elsewhere).
2. Use of misleading information: If standardized system is not in place, there are multiple
opportunities for fabricating information about an employee’s performance.

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 3. Lowered self-esteem: Self-esteem may be lowered if feedback is provided in an
inappropriate 7 inaccurate way. This, in turn can create employee resentment.
4. Wasted time money: Performance management systems cost money & quite a bit of
time. These resources are wasted when systems are poorly designed & implemented.
5. Damaged relationships: As a consequence of a deficient system, the relationship among
the individuals involved may be damaged, often permanently.
6. Decreased motivation to perform: Motivation may be lowered for many reasons
including the feeling that superior performance is not translated into meaningful
tangable (e.g., pay increase) or intangiable (e.g., personal recognition) rewards
7. Employee burnout & job dissatisfaction: When the performance assessment instrument
is not seen as valid & the system is not perceived as fair, employees are likely to feel
increased levels of job burnout & job dissatisfaction. As a consequence, employees are
likely to become increasingly irritated.
8. Increased risk of litigation: Expensive lawsuits may be filed by individuals who feel they
have been appraised unfairly.
9. Varying & unfair standards & ratings: Both standards & individual ratings may vary
across & within units & also be unfair
10. Emerging biases: personal values, biases, & relationships are likely to replace
organizational standards.

Aims & Roles of PM Systems:

Performance management systems serve multiple purposes.

 First, they serve a strategic purpose because they help link employee activities with the
organisation’s mission and goals, they identify results and behaviours needed to carry
out strategy, and they maximize the extent to which employees exhibit the desired
behaviors and produce the desired results.
 Second, they serve an administrative purpose in that they produce information used by
the reward system and other HR decision-making (e.g., promotions, termination,
disciplinary actions).
 They serve an information purpose because they are the source of information for
employees to learn about their performance vis-à-vis the expectations,
 Fourth, they serve a developmental purpose in that performance feedback allows
individuals to learn about their strengths and weaknesses, to identify training needs,
and to make better decisions regarding job assignments.
 Fifth, Organisational maintenance purpose because they provide useful information for
workforce planning and for evaluating the effectiveness of other HR systems (e.g.,
comparing performance before and after an expensive training programme to see
whether training made a difference).
 Finally, performance management systems also serve a documentation purpose – for
example to support HR decisions and help meet legal requirements.

Characteristics of an ideal PM systems:

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Ideal performance management systems are rare. Such ideal systems are:
Many trade-offs take place in the real-world implementation of performance management
systems. However, the closer the system is to the ideal characteristics, the greater the return
will be for employees, supervisors, and the organisation as a whole. A performance
management system is the key factor determining whether an organisation can manage its
human resources and talent effectively. Performance management provides information
on who should be trained and in what areas, which employees should be rewarded, and what
types of skill are lacking at the organisation or unit level. Therefore performance management
also provides information on the types of employee who should be hired. When implemented
well, performance management systems provide critical information that allows organisations
to make sound decisions regarding their people resources. As should be evident by now,
implementing an ideal performance management system requires a substantial amount of
work. But this does not start when the system is put into place. The process starts much earlier,
because unless specific conditions are present before the system is implemented, the system
will not achieve its multiple purposes. Module PE02 provides a description of the entire
performance management process.

However we should strive to place a check mark next to each of these characteristics: the more
features that are checked, the more likely it will be that the system will live up to its promise.

 Strategic congruence: The system be congruent with the unit & organisation’s strategy.
In other words, individual goals must be aligned with unit & organizational goals.
 Thoroughness: The system should be thorough regarding four dimensions. First, all
employees should be evaluated (including managers). Second all major job
responsibilities should be evaluated (including behaviors & results). Third, the
evaluation should include performance spanning the entire review period, not just the
few weeks or months before the review. Finally, feedback should be given on positive
performance aspects as well as those that are in need of improvement.
 Practicality: Systems that are too expensive, time consuming, & convoluted will
obviously not be effective. Good, easy-to-use systems (e.g., performance data are
entered via user-friendly software) are available for managers to help them make
decisions. Finally the benefits of using the system( e.g., increased performance & job
satisfaction) must be seen as outweighing the costs(e.g., time, effort, expense).
 Specificity: A good system should be specific,it should provide detailed & concrete
guidance to employees about what is expected of them & how they can meet these
expectations.
 Identification of effective & ineffective performance: The performance management
system should provide information that allows for the identification of effective &
ineffective performance. That is, the system should allow for distinguishing b/w
effective & ineffective behaviors & results thereby also allowing for the identification of
employees displaying various levels of performance effectiveness. In terms of decision
making, a system that classifies or ranks all levels of performance & all employees,
similarly is useless.

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  Reliability: A good system should include measures of performance that are consistent
& free of error. For example, if two supervisors provided ratings of the same employee
& performance dimensions, ratings should be similar.

Performance Management Process:

Performance management is an ongoing process. It never ends. Once established in an

organisation, it becomes part of an organisation’s culture. The performance management
process includes six closely related components: (a) prerequisites, (b) performance planning, (c)
performance execution, (d) performance assessment, (e) performance review, and

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(f) Performance Renewal & Recontracting.

Job analysis can be conducted using interviews, observation, or off-the-shelf questionnaires.

Once a list of tasks has been compiled, all incumbents should have an opportunity to review the
information and rate each task in terms of frequency and criticality. Each of the six components
of the performance management process plays an important role. If any of these components is
implemented poorly, then the entire performance management system suffers.
For example, lack of knowledge of the organisation’s mission and the job in question (i.e.,
prerequisites) will not allow performance planning (i.e., performance roadmap) to be aligned
with organisational goals. This in turn will lead to poor performance execution. In short, a
performance management system is only as good as its weakest component. The links between
the various components need to be established clearly. For example, performance planning
needs to be closely related to performance execution. Performance planning is a futile exercise
if execution does not follow from planning.

The First Component Of The Performance Management Process Involves Two Prerequisites.
First, there is a need to have good knowledge of the organisation’s mission. This knowledge,
combined with knowledge regarding the mission of one’s unit, allows employees to make
contributions with a positive impact on their unit and on the organisation as a whole. Second,
there is a need to have good knowledge of the job in question. A job analysis allows for the
determination of the key components of a particular job: what tasks need to be done, how and
what KSAs are needed. If we have good information regarding a job, then it is easier to establish
criteria for job success.

The Second Component Of The Performance Management Process Involves Performance

Planning: Performance planning includes the consideration of results and behaviour, as well as
a development plan. A discussion of results needs to include key accountabilities (i.e., broad
areas for which an employee is responsible), specific objectives for each key accountability (i.e.,
goals to be reached), and performance standards (i.e., what are acceptable and unacceptable
levels of performance). A discussion of behaviours needs to include competencies (i.e., clusters
of KSAs). Finally, the developmental plan includes a description of areas that need improving
and goals to be achieved in each area.

The Third Component Involves Performance Execution: Both the employee and the manager
are responsible for performance execution. For example, the employee needs to be committed
to goal achievement, and should take a proactive role in seeking feedback from his or her
supervisor. The burden is on the employee to communicate openly and regularly with the
supervisor. Also, the employee has a responsibility to be prepared for the performance review
by conducting regular and realistic self-appraisals. On the other hand, the supervisor also has
important responsibilities. These include observing and documenting performance, updating

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the employee on any changes in the goals of the organisation, and providing resources and
reinforcement so that the employee can succeed and continues to be motivated.

The Fourth Component Involves Performance Assessment: Both the employee and the
supervisor must evaluate employee performance. Involvement of the employee in the process
increases his or her ownership and commitment to the system. In addition, it provides
important information to be discussed during the performance review. In the absence of self-
appraisals, it is often not clear to supervisors whether employees have a real understanding of
what is expected of them.

The Fifth Component Involves Performance Review: This is when the employee and manager
meet to discuss employee performance; this meeting is usually called the appraisal meeting.
This meeting usually emphasizes the past: what the employee has done and how. However, an
effective appraisal meeting also focuses on the present and the future. The present involves the
changes in compensation that may be a product of the results obtained. The future involves a
discussion of goals and development plans the employee will be expected to achieve during the
next review period.

The Final Component Involves Performance Renewal & Recontracting: Essentially this
component is identical to the performance planning stage. However, performance renewal and
recontracting uses information gathered during the review period to make adjustments as
needed. For example, some new key accountabilities and competencies may be included, or
some goals may have to be adjusted either upwards or downwards.

Performance Management & Strategic Planning:

Strategic Planning: Strategic planning is a process that involves describing the organization’s
destination, assessing barriers that stand in the way of destination, & selecting approaches for
moving forward. The main goal of strategic planning is to allocate resources in a way that
provides organizations with a competitive advantage. Overall, a strategic plan serves as a
blueprint that defines how the organizations will allocate its resources in pursuit of its goals.

Strategic planning involves defining the organisation’s present and future identity. The overall
purpose of a strategic plan is to serve as a blueprint allowing organisations to allocate resources
in a way that provides the organisation with a competitive advantage. Strategic planning serves
several purposes, including defining an organisation’s identity, preparing for the future,
analysing the environment, providing focus, creating a culture of cooperation, generating new
options, and serving as a guide for the daily activities of all organisational members.
Performance management systems must rely on the strategic plan to be useful. The
behaviours, results and development plans of all employees must be aligned with the vision,
mission, goals and strategies of the organisation and unit. The process of creating a strategic
plan begins with an environmental analysis, which considers both internal (e.g., organisational
structure, processes, etc.) and external (e.g., economic, technological, etc.) trends. Internal
trends can be classified as either strengths or weaknesses, and external trends can be classified

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as either opportunities or threats. A gap analysis consists of pairing strengths/weaknesses with
opportunities/threats and determining whether the situation is advantageous (i.e., leverage),
disadvantageous (i.e., problem), or somewhere in between (i.e., constraint and vulnerability).
The second step in creating a strategic plan is to write a mission statement based on the results
of the gap analysis. A mission statement defines why the organisation exists, the scope of its
activities, the customers served, and the products and services offered. Mission statements also
include information such as what technology is used in production or delivery, and the unique
benefits or advantages of the organisation’s products and services. Finally, a mission statement
can include a statement of values and beliefs, such as the organisation’s managerial philosophy.
The third component of a strategic plan is the vision statement, which includes a description of
future aspirations. Whereas the mission statement emphasises the present, the vision
statement emphasises the future. However, in many cases the mission and vision statements
are combined into one. For vision statements to be most useful they must be: (a) brief, (b)
verifiable, (c) bound by a timeline, (d) current, (e) focused, (f) understandable, (g) inspiring, and
(f) a stretch. Once the mission and vision statements are created, the next step in the strategic
planning process is to generate specific goals to help fulfil the mission and vision. Goals provide
more specific information regarding how the mission and vision will be implemented. Typically,
goals span a 5-year period. The final step in the strategic planning process is to identify
strategies that will help achieve the stated goals. These strategies are game plans, and usually
address issues around growth, survival, turnaround, stability, innovation and leadership. The HR
function plays an important role in identifying strategies because they have knowledge of the
organisation’s mission and vision as well as the organisation’s internal capabilities, or what is
called an organisation’s human capital. The organisation’s strategic plan, including the mission,
vision, goals and strategies, cascades down to all organisational levels. Thus each division/unit
also creates its own strategic plan, which should be consistent with the organisation’s plan.
The tasks and KSAs included in individual job descriptions must be congruent with the
Organisation’s and unit’s strategic plans. In other words, job descriptions should include
activities that, if executed well, will help fulfill the mission and vision. Job descriptions detached
from strategic priorities will lead to performance evaluations focused on behaviours and results
that are not central to an organisation’s success. The various choices in designing the
performance management system are directly affected by an organisation’s strategic plan.
Different missions and visions lead to different types of system, for example emphasising
behaviours (i.e., processes) as opposed to results (i.e., outcomes). Top management must be
aware that the performance management system is a primary tool to execute an organisation’s
strategic plan. This awareness will lead to top management supporting the system. In addition,
all organisational members need to be able to answer the ‘what’s in it for me’ question
regarding the system. Implementing the performance management system will require
considerable effort on the part of all those involved. For this reason, those doing the evaluation
and those being evaluated should know how the system will benefit them directly.

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 MODULE 2: PERFORMANCE APPRAISAL SYSTEM IMPLEMENTATION

Defining Performance: Performance is about behaviours or what employees do, and not
about what employees produce or the outcomes of their work. However, performance
management systems typically include the measurement both of behaviours (how the work is
done) and of results (the outcomes of one’s work).
Performance is evaluative (i.e., we judge it based on whether it helps advance or hinder
organisational goals) and multidimensional (i.e., many behaviours are needed to describe an
employee’s performance).

Determinants of Performance:

What factors cause an employee to perform at a certain level? Why do certain individuals
perform better than others? A combination of three factors allow some people to perform at
higher levels than others: Performance is determined by a combination of
a) Declarative knowledge (i.e., information)
b) Procedural knowledge (i.e., know-how) &
c) Motivation (willingness to perform).
Thus,
Performance = Declarative knowledge × Procedural knowledge × Motivation
If any of the determinants has a value of 0, then performance also has a value of 0

Factors Determining performance:

Declarative knowledge Procedural knowledge Motivation

Facts Cognitive Skill Choice to perform
Principals Psychomotor Skill Level of effort
Goals Physical Skill Persistence of effort
Interpersonal Skill

Deliberate practice involves the following five steps:

1. Approach performance with the goal of getting better & better.

2. As you are performing, focus on what is happening &why you are doing things the way
you do.
3. Once your task is finished, seek performance feedback from expert sources, & the more
sources the better.
4. Build mental modals of your job, your situation, & your organization.

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 5. Repeat steps 1-4 continually & on an ongoing basis.

Performance Dimensions:
As noted earlier, performance is multidimensional, meaning that we need to consider many
different types of behaviors to understand performance. Although we can identify many
specific behaviours, two types of behaviours or performance facets stand out: Task
performance & contextual performance.

Contextual & task performance must be considered separately because they do not necessarily
occur in tandem. An employee can be highly proficient at higher task, but be an
underperformer regarding contextual performance.

Task performance: Activities that transform raw materials into the goods & services that are
produced by the organisation. Activities that help with the transformation process by
replenishing the supply of raw materials, distributing its finished products, or providing
important planning, coordination, supervising, or staff functions that enables the organisation
to function effectively & efficiently.

Contextual Performance: It is defined as those behaviors that contribute to the organisation’s

effectiveness by providing a good environment in which task performance can occur.
Contextual Performance includes behaviors such as the following:

 Persisting with enthusiasm & exerting extra effort as necessary to complete one’s own
task activities successfully (e.g., being punctual 7 rarely absent, expending extra effort
on the job)
 Volunteering to carry out task activities that are not formally part of the job (e.g.,
suggesting organisational improvements, making constructive suggestions)
 Helping & cooperating with others (e.g., assisting & helping coworkers & customers)
 Following organisational rules & procedures(e.g., following orders & regulations,
showing respect for authority, complying with organisational values & policies)
 Endorsing, supporting rules & defending organisational objectives (e.g., organisational
loyalty, representing the organisational favorably to outsiders)

Ethical Performance: It focuses on doing the right thing. This sounds simple, but the fact is that
nearly everyone faces dilemmas at work. The most frequent acts were cutting corners on
quality control, covering up some incidents, abusing or lying about sick days, deceiving
customers, & putting inappropriate pressure on other employees at work.

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Approaches to Measuring Performance:
Trait Approach:

The trait approach emphasizes the individual performer & ignores the specific situation,
behaviours, & results. If one adopts the trait approach, raters evaluate relatively stable trait.
These can include abilities, such as cognitive abilities (which are not easily trainable) or
personality (which is not likely to change over time). For example performance measurement
may consist of assessing an employee’s intelligence & conscientiousness at the end of each
review period.

Job Performance In Context:

What are some of the challenges of implementing a system that emphasizes the measurement
of traits only? First, traits are not under the control of individuals. In most cases, they are fairly
stable over one’s life span. They are not likely to change even If an individual is willing to exert
substantial effort to do so. Consequently, employees may feel that a system based on traits is
not fair because the development of these traits is usually beyond their control. Second the fact
that an individual possesses a certain trait (e.g., intelligence) does not mean that trait will
necessarily lead to desired results & behaviors. As noted in above flow chart individuals are
embedded in specific situations. If the equipment is faulty & coworkers are uncooperative,
even a very intelligent & conscientious employee is not likely to engage in behaviors conducive
to supporting the organisation’s goals.

Behavior Approach:

The behavior approach emphasizes what employee do on the job & does not consider
employees traits or the outcomes resulting from their behaviours. This is basically a process-
oriented approach that emphasizes how an employee does the job.

The behavior approach is most appropriate under the following circumstances:

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  The link between behaviors & results is not obvious: Sometimes the relationship b/w
behaviors & desired outcomes is not clear. In some cases, the desired result may not be
achieved in spite of the fact that the right behaviors are in place.
 Outcomes Occur In The Distant Future: When the desired results will not be seen for
months, or even years, the measurement of behaviors in beneficial.
 Poor Results Are Due To Causes Beyond The Performer’s Control: When the results of
an employee’s performance are beyond the employee’s control, then it makes sense to
emphasize the measurement of behaviors.

Result Approach:

 Workers are skilled in the needed behaviors: An emphasis on results is appropriate

when workers have the necessary knowledge & skills to do the work. In such situations,
workers know what specific behaviors are needed to achieve the desired results & they
are also sufficiently skilled to know what to do to correct any process related problems
when the desired results are not obtained.
 Behaviors & results are obviously related: In some situations certain results are
obtained only if a worker engages in a certain specific behaviors. This is the case of job
involving reparative task such as assembly-line work or newspaper delivery.
 Results show consistent improvement over time: When results improve consistently
over time. It is an indication that workers are aware of behaviors needed to complete
the job successfully. In these situations it is appropriate to adopt a result approach to
assessing performance.
 There are many ways to do the job right: When there are different ways in which one
can do the tasks required for a job, a results approach is appropriate. An emphasis on
results can be beneficial because it could encourage employees to achieve the desired
outcomes in creative & innovative ways.

Diagnosing the causes of poor performance:

As a manager one has to deal with the poor performance. To do that one needs to essentially
identify the problem & the causes which created the problem, decide on a solution & make the
solution work.

Following factors can lead to poor performance:

Faulty Management
Unsupportive Organization
Inadequate work-systems & processes
Individuals In capabilities

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Main differences b/w Task & Contextual Performance:

Task Performance Contextual Performance

Varies across jobs Fairly similar across jobs
Likely to be prescribed Not likely to be role prescribed
Antecedents: abilities & skills Antecedent: personality

Task performance relates to transforming raw materials into the goods and services which are specific to
the job, the core technical skill. Contextual performance concerns aspects of an individual’s
performance which maintains and enhances an organisation’s social network and the psychological
climate that supports technical tasks. Borman and Motowidlo, (1997) contend that it is the contextual
dimensions of job performance, rather than the technical components, that can be predicted from
personality constructs and Borman, Penner, Allen and Motowidlo (2001) conclude that personality
(Conscientiousness and Dependability) correlates more highly with organisational citizenship behaviours
than with task performance. It appears that, conversely, cognitive abilities are more relevant for the
prediction of task performance (Arvey & Murphy, 1998). Other research asserts that when the
personality variables used in the prediction of performance are derived through job analysis, they
predict task-related performance, as well as contextual job performance (Cue, 2002; Jenkins & Griffith,
2004). Jenkins and Griffith (2004) go on to state that in order to predict narrow aspects of performance,
narrow traits (more specific, primary or facet level) should be used rather than broad global traits such
as the FFM’s Openness to Experience, Conscientiousness, Extraversion, Agreeableness and Neuroticism.

Choosing performance measurement approach:

Trait Approach: What are some of the challenges of implementing a system that emphasizes
the measurement of traits only? First, traits are not under the control of individuals. In cases,
they are fairly stable over one's life span. They are not likely to change even individual is willing
to exert substantial effort to do so. Consequently, employees feel that a system based on traits
is not fair because the development of these traits is usually beyond their control.19 Second,
the fact that an individual possesses a certain trait (e.g., intelligence) does not mean that this
trait will necessarily lead to desired results and behaviors. As individuals are embedded in
situations. If the equipment is faulty and coworkers are uncooperative, even a very recent and
conscientious employee is not likely to engage in behaviors conducive supporting the
organization's goals. In spite of these challenges, there are situations in which a trait -oriented

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approaches fruitful. For example, as part of its business strategy, an organization may
anticipate drastic structural changes that will result in the reorganization of most functions
the resulting reallocation of employees. In such a circumstance, it may be useful to the traits
possessed by the various individuals so that fair and appropriate decisions are made regarding
the allocation of HR resources across the newly created organization.
Behavior Approach: Sometimes the relationship between behaviors and the desired outcomes
is not clear. In some cases, the desired result may not be achieved in spite of the fact that the
right behaviors are in place. For example, a salesperson may not be able to close a deal because
downturn in the economy. In other cases, results may be achieved in spite the absence of the
correct behaviors. For example, a pilot may not check all items in the preflight checklist but the
flight may nevertheless be successful take off and land safely and on time). When the link
between behaviors and results is not always obvious, it is beneficial to focus on behaviors as
opposed to outcomes.
Result Approach: The results approach emphasizes the outcomes and results produced by the
employees. It does not consider the traits that employees may possess or how employees do
the job. This is basically a bottom-line approach that is not concerned about employee
behaviors and processes but, instead, focuses on what is produced (e.g., sales, number of
accounts acquired, time spent with clients on the telephone, number of errors). Defining and
measuring results usually takes less time than defining and measuring behaviors needed to
Thieve these results. Also, the results approach is usually seen as more cost-effective because
results can be less expensive to track than behaviors. Overall, data resulting from results
approach seem to be objective and are intuitively very appealing. The results approach is most
appropriate under the following circumstances: Workers are skilled in the needed behaviors. An
emphasis on results is appropriate when workers have the necessary knowledge and skills to do
the work. In such situations, workers know what specific behaviors are needed to achieve the
desired results and they are also sufficiently skilled to know what to do to correct any process
related problems when the desired results are not obtained. Consider the example of a
professional basketball player. A free throw is an unhindered shot made from the foul line
which is given to one team to penalize the other team for committing a foul. Free throw
shooting can make the difference between winning and losing in a close basketball game.
Professional players know that there is really no secret to becoming a great free throw shooter:
just hours and hours of dedicated practice besides actual basketball play. In assessing the
performance of professional basketball players, the free throw shooting percentage is a key
results-oriented performance indicator because most players have the skills to do it well. It's
just a matter of assessing whether they do it or not. Behaviors & results are obviously related.
Results show consistent improvement over time. There are many ways to do the job right.

Measuring results and behaviours:

As a reminder, key accountabilities are broad areas of a job for which the employee is
responsible for producing results. A discussion of results also includes specific objectives that
the employee will achieve as part of each accountability. Objectives are statements of
important and measurable outcomes. Finally, discussing results also means discussing
performance standards. A performance standard is a yardstick used to evaluate how well

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employees have achieved each objective. Performance standards provide information on
acceptable and unacceptable performance, for example, regarding quality, quantity, cost, and
time. Organizations that implement a management by objectives (MBO) philosophy are likely to
implement performance management systems, including objectives and standards. For
example, the contract for the chief of police of the city of Flevoland in the Netherlands includes
a direct link between objectives of the police department and his personal income.2 Similarly,
the police department of the city of Utrecht (also in the Netherlands) has specific performance
objectives including that 150 suspects of public violence and 1,050 minors suspected of any
crime should be brought before the public prosecutor annually. Similar objectives have been
set by police departments in England and Wales. Setting these objectives has not always led to
the intended results because, in many cases, police officers resort to gaming strategies to
achieve the objectives, often at the expense of providing a high-level quality of service to their
local communities.3 Nevertheless, overall, an emphasis on objectives and standards is likely to
allow employees to translate organizational goals into individual goals, which is a key
goal of MBO philosophies.

Determining Accountabilities: The first step in determining accountabilities is to collect

information about the job. The primary source is, of course, the job description that has
resulted from the job analysis and a consideration of unit- and organization-level strategic
priorities. The job description provides information on the tasks performed. Tasks included in
the job description can be grouped into clusters of tasks based on their degree of relatedness.
Each of these clusters or accountabilities is a broad area of the job for which the employee is
responsible for producing results.

Determining Objectives: After the accountabilities have been identified, the next step in
measuring results is to determine specific objectives. Objectives are statements of an important
and measurable outcome that, when accomplished, will help ensure success for the
accountability. The purpose of establishing objectives is to identify a limited number of highly
import that, when achieved, will have a dramatic impact on the overall success of organization.
After objectives are set, employees should receive feedback on their progress toward attaining
the objective. Rewards should be allocated to those employees who have reached their
objectives.

Gathering Performance Information:

Appraisal Forms: At the core of any performance management system is the assessment of
performance. Information on performance is collected by using forms, which can be filled out
on paper or electronically. One advantage of filling out forms electronically is that the
information is stored and it can easily be shared, for example, between the manager filling out
the form and the human resources (HR) department. Also, having the data available in
electronic form can help in subsequent analyses, for example, in making comparisons of the
relative average performance levels of various units within the organization. Finally, using
electronic forms is beneficial because, as changes take place in the organization or job in
question, forms need to be revised and updated and electronic forms are usually easier to

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modify than paper forms. Regardless of whether they are electronic or paper, appraisal forms
usually include a combination of the following components:
Basic employee information:. This section of the form includes basic employee information such
as job title, division, department and other work group information, employee number, and pay
grade or salary classification. In addition, forms usually include the dates of the evaluation
period, the number of months and years the rater has supervised or worked with the
employee, an employee's starting date with the company and starting date in the current job,
the reason for appraisal, current salary and position in range, and the date of the next
scheduled evaluation.
Accountabilities, objectives, and standards. If the organization adopts a results approach, this
section of the form would include the name and description of each accountability, objectives
agreed upon by manager and employee, and the extent to which the objectives have been
achieved. In many instances, the objectives are weighted in terms of importance, which
facilitates the calculation of an overall performance score. Finally, this section can also include a
subsection describing conditions under which performance was achieved, which may help
explain why performance achieved the (high or low) level described. For example, a supervisor
may have the opportunity to describe specific circumstances surrounding performance during
the review period, including a tough economy, the introduction of, a new line of products, and
so forth.
Competencies and indicators: If the organization adopts a behavior approach, this section of the
form includes a definition of the various competencies to be assessed, together with their
behavioral indicators.
Major achievements and contributions. Some forms include a section in which a rater is asked to
list the two or three major accomplishments of the individual being rated during the review
period. These could refer to results, behaviors, or both.
Developmental achievements. This section of the form includes information about the extent to
which the developmental goals set for the review period have been achieved. This can include a
summary of activities, such as workshops attended and courses taken, as well as results, such
as new skills learned. Evidence of having learned new skills can be documented, for example, by
obtaining a professional certification.
Developmental needs, plans, and goals. This section of the form is future oriented and includes
information about specific goals and timetables in terms of employee development. As noted
before, some organizations choose to create a separate development form and do not include
this information as part of the performance appraisal form.
Stakeholder input. Some forms include sections to be filled out by other stake holders, such as
customers with whom the employee interacts. Overall, stakeholders are defined as people who
have firsthand knowledge of and are affected by the employee's performance. In most cases,
input from other stakeholders is collected from them by using forms separate from the main
appraisal because not all sources of performance information are in the position to rate the
same performance dimensions. For example, an employee may be rated on the competency
"teamwork" by peers and on the competency "reliability" by a customer. A more detailed
discussion of the use of various sources of performance information is offered later in this
chapter.

15
Employee comments. This section includes reactions and comments provided by the employee
being rated. In addition to allowing formal employee input, which improves the perceived
fairness of the system, the inclusion of this section helps with legal issues because it documents
that the employee has had an opportunity to participate in the evaluation process.
Signatures. The final section of most forms includes a section in which the employee being
rated, the rater, and the rater's supervisor provide their signatures to show they have seen and
discussed the content of the form. The HR department may also provide approval of the
content of the form.

Characteristics Of Appraisal Forms:

We should be aware that there is no such thing as a universally correct appraisal form. In some
cases, a form may emphasize competencies and ignore results. This would be the case if the
system adopted a behavior as opposed to results approach to measuring performance. In
others, the form may emphasize developmental issues and minimize, or even completely
ignore, both behaviors and results. In such cases, the form would be used for developmental
purposes only and not for administrative purposes. One size does not fit all, and different
components are appropriate based on the purposes of the appraisal. In spite of the large
variability in terms of format and components, there are certain desirable features that make
appraisal forms particularly effective:
Simplicity. Forms must be easy to understand, easy to administer, quick to complete,clear, and
concise. If forms are too long, convoluted, and complicated, it is likely that the performance
assessment process will not be effective.
Relevancy. Good forms include information related directly to the tasks and responsibilities of
the job; otherwise, they will be regarded as an administrative burden and not as a tool for
performance improvement.
Descriptiveness. Good forms require that the raters provide evidence of performance
regardless of the performance level. The form should be sufficiently descriptive that an outside
party (e.g., supervisor's supervisor or HR department) has a clear understanding of the
performance information conveyed.
Adaptability. Good forms allow managers in different functions and departments to adapt
them to their particular needs and situations. This feature encourages widespread use of the
form.

Who Should Provide Performance Information?

So far, we have assumed that the supervisor is the primary source for performance information.
This is the case in most organizations because the supervisor observe employees directly and
has good knowledge about performance standards. However: there are also alternative sources
of performance information. Let's consider the use of the direct supervisor as a source of
performance information, followed by the use of other sources including peers,
subordinates, self, and customers
SUPERVISORS: An advantage of using supervisors as a source of performance information is
that are usually th the best position to evaluate performance in relation to strategic orgar_-

16
zational goals. Also, supervisors are often those making decisions about rewards associated
with performance evaluation. In addition, supervisors are able to differentiate among various
performance dimensions (e.g., adaptability, coaching, and development) regardless of the level
of experience of the employee being rated.13 In shot_ supervisors are often the most
important source of performance information becaust they are knowledgeable about strategic
issues, understand performance.

Peers: Many organizations use performance evaluations provided by peers. Take, for example,
the system implemented at a large international financial services bank.15 Through
acquisitions, the bank has been growing rapidly and has as its strategic goal the consolidation of
its offices. Change management is extremely important to the successful implementation of
this consolidation. The company is therefore revising how it assesses the competency
"teamwork" at the senior and middle management levels, with the belief that successful
teamwork is crucial to change management initiatives. Specifically, one-third of the score for
this competency is determined by ratings provided by peers. As an additional example, the
Australian National University Medical School recently introduced a system in which students
rate their peers in terms of personal and professional performance. Students begin to provide
anonymous ratings on-line at the end of their first year in medical school. The system allows
students to share their assessment of their peers and provides faculty with early-warning signs
to assist students who may not be performing up to personal or professional standards.

Subordinates: Subordinates are a good source of information regarding the performance of

their managers.18 For example, subordinates are in a good position to evaluate leadership
competencies, including delegation, organization, and communication. In addition subordinates
may be asked to rate their manager's ability to (1) remove barriers that employees face,shield
employees from politics, and (3) raise employees' competence. With this type of system,
subordinates may hesitate to provide upward feedback if put on the spot: however, if managers
take the time to involve employees in the process by soliciting their input, employees are more
likely to give honest feedback.

Customers: Customers, and other key stakeholders in general, provide yet another source of
performance information. Collecting information from customers can be a costly and time
consuming process; however, performance information provided by customers is particularly
useful for jobs that require a high degree of interaction with the public or with particular job-
related individuals (e.g., purchasing managers, suppliers, sales representatives). Also,
performance information can be collected from internal customers.

Implementing Performance Management System:

Communication Plan: In general, having more and better knowledge of the performance
management system leads to greater employee acceptance and satisfaction.1 Organizations
often design a communication plan to ensure that information regarding the performance

17
management system is widely disseminated in the organization. A good communication plan
answers the following questions

What is performance management? Answering this question involves providing general

information about performance management, how performance management systems are
implemented in other organizations, and the general goals of performance management
systems.
How does performance management fit into our strategy? To answer this question, we should
provide information on the relationship between performance management and strategic
planning. Specifically, information is provided on how the performance management system
will help accomplish strategic goals.
What's in it for me? A good communication plan describes the benefits of implementing
performance management for all those involved.
How does it work? Answering this question entails giving a detailed description of the
performance management process and time line: for example, when meetings will take place,
what the purposes of each meeting are, and when decisions
about rewards will be made.
What are my responsibilities? The communication plan should include information on the role
and responsibilities of each person involved at each stage of the process. For example, it
includes a description of the employees' and supervisors'
main responsibilities in the performance management process.
How is performance management related to other initiatives? The communication plan should
include information on the relationship between performance management and other
initiatives and systems, such as training, promotion, and succession planning.

APPEALS PROCESS:
The inclusion of an appeals process is important in gaining employee acceptance for the
performance management system because it allows employees to understand that, if there is a
disagreement regarding performance ratings or any resulting decisions, then such
disagreements can be resolved in an amicable and non retaliatory way. In addition, the
inclusion of an appeals process increases perceptions of the system as fair.

When an appeals process is in place, employees have the ability to question two types of
issues: judgmental and administrative.? Judgmental issues center on the validity of the
performance evaluation. For example, an employee may believe that a manager's performance
ratings for that employee do not reflect his actual performance. Administrative issues involve
whether the policies and procedures were followed.

For example, an employee may argue that her supervisor did not meet with her as frequently as
he had with her coworkers and that the feedback she is receiving about her performance is not
as thorough as that received by her coworkers. Typically, when an appeal is first filed, the HR
department serves as a mediator between the employee and the supervisor. An appeal sent to
the HR department is usually called a Level 1 or Level A appeal. The HR department is in a good
position to judge whether policies and procedures have been implemented correctly and also

18
has good information about the various jobs, levels of performance expected, and levels of
performance of other employees within the unit and organization. The HR department gathers
the necessary facts and brings them to the attention of either the rater to encourage
reconsideration of the decision that cause d the appeal or to the complainant to explain why
there have been no biases or violations. In other words, the HR department either suggests
corrective action to the supervisor or informs the employee that the decision or procedures
were correct. If the supervisor does not believe corrective action should be taken or if the
employee does not accept the HR decision, and the appeal continues, then an outside and
unbiased arbitrator makes a final and binding resolution.

This is usually called a Level 2 or Level B appeal. This arbitrator can consist of a panel of peers
and managers. The panel reviews the case, asks questions, interviews witnesses, researches
precedents, and reviews policy. Then, they simply take a vote to make the decision. In some
cases, the vote represents the final decision. In other cases, the vote is forwarded to a highlevel
manager (vice president or higher level) who takes the panel's vote into consideration in
making the final decision.

The box "Selected Excerpts from the University of North Carolina Performance Management
Appeals Process" shows some of the key sections of the performance management appeals
process for employees at the University of North Carolina. The appeals process is intended to
air concerns and to resolve disagreements. The purpose of this specific policy is to provide
employees and management with a means for resolving disagreements involving performance
evaluations and performance pay issues.

TRAINING PROGRAMS FOR THE ACQUISITION OF REQUIRED SKILLS:

Training the raters is another step necessary in preparing for the launching of the performance
management system. Training not only provides participants in the performance management
system with needed skills and tools to do a good job implementing it but also helps increase
satisfaction with the system.

RATER ERROR TRAINING

Many performance management systems are plagued with rater errors. For example. long as
about 1,700 years ago, the Wei dynasty in China implemented a performance management
system for its household members. The philosopher Sin Yu has bee: quoted as saying that "an
Imperial Rater of Nine Grades seldom rates men according to their merits, but always according
to his likes and dislikes."10 Accordingly, the goal of rater error training (RET) is to make raters
aware of what rating errors they are like% to make and to help them develop strategies to
minimize those errors. The goal of RET is to increase rating accuracy by making raters aware of
the unintentional errors the are likely to make.
RET programs typically include definitions of the most typical errors and a description of
possible causes for those errors. Such programs also allow trainees to view examples of
common errors and to review suggestions on how to avoid making errors. TIN can he done by

19
showing videotaped vignettes designed to elicit rating errors and ask trainees to fill out
appraisal forms regarding the situations that they observed on videotapes. Finally, a
comparison is made between the ratings provided by the trainee and the correct ratings. The
trainer then explains why the errors took place, which specific errors were made, and ways to
overcome the errors in the future. RET does not guarantee increased accuracy. Raters do
become aware of the possible errors they can make but, because many of the errors are
unintentional, simple awareness of the errors does not mean that errors will not be made.
Nevertheless. may be useful to expose raters to the range of possible errors. These errors
include following:
Similar to me error. Similarity leads to attraction, so we tend to favor those who are similar to
us. Consequently, in some cases, supervisors are more likely to give higher performance ratings
to those employees who are perceived to be more similar to them in terms of attitudes,
preferences, personality, and demographic variables including race and gender.
Contrast error. Contrast error occurs when, even if an absolute measurement system is in place,
supervisors compare individuals with one another instead of against predetermined standards.
For example, when a supervisor rates an individual of only average performance, the rating may
actually be higher than deserved if the other individuals rated by the same supervisor display
substandard performance levels: the age performer may seem to be better in comparison to
the others. This error is most likely to occur when supervisors complete multiple appraisal
forms at the same time because, in such situations, it is difficult to ignore the ratings given to
other employees
Leniency error Leniency error occurs when raters assign high (lenient) ratings u most or all
employees. In other words, leniency involves artificial rating inflation.

Pilot Testing:
Before the performance management system is implemented formally, it is a good idea to test
a version of the entire system so that adjustments and revisions can be made a needed. In pilot
test of the system, evaluations are not recorded in employee files: however, the system is
implemented in its entirety from beginning to end, including all the steps that would be
included if the system had actually been implemented. In other words, meetings take place
between supervisor and employee, performance data are gathered, developmental plans are
designed, and feedback is provided. The most important aspect of the pilot test is that all
participants maintain records noting any difficulties they encountered, ranging from problems
with the appraisal form and how performance is measured to the feedback received. The pilot
test allows for the identification and early correction of any flaws before the system is
implemented throughout the organization.

Ongoing Monitoring And Evaluation:

When the testing period is over and the performance management system has been
implemented organization -wide, it is important to use clear measurements to monitor and
evaluate the system.27 In a nutshell, a decision needs to be made about how to evaluate the
system's effectiveness, how to evaluate the extent to which the system is being implemented
as planned, and how to evaluate the extent to which it is producing the intended results. The
United States federal government takes the evaluation of performance management systems
20
very seriously. Since the early 1990s, several laws have been passed that mandate federal
agencies to develop a strategic plan, a performance plan, and a performance report.

Conducting Staff Appraisals:

Introduction: Performance appraisal is a method of evaluating the behavior of employees in

the workspot, normally including both the quantitative and qualitative aspects of job
performance. Performance here refers to the degree of accomplishment of the tasks that make
up an individual's job. It indicates how well an individual is fulfilling the job demands. Often the
term is confused with effort, which means energy expended, and used in a wrong sense.
Performance is always measured in terms of results. A student, for example, may exert a great
deal of effort while preparing for the examination but may manage to get a poor grade. In this
case the effort expended is high but performance is low.

Need:
1) Providing Feedback: Providing feedback is the most common justification for an organization
to have a performance appraisal system. Through its performance appraisal process the
individual learns exactly how well he did during the previous twelve months and can then use
that information to improve her performance in the future. In this regard,
performance appraisal serves another important purpose by making sure that the boss's
expectations are clearly communicated.
2) Facilitating Promotion Decisions: Almost everyone in an organization wants to get ahead.
How should the company decide who gets the brass rings? Performance appraisal makes it
easier for the organization to make good decisions about making sure that the most important
positions are filled by the most capable individuals.
3) Facilitating Lay-off or Downsizing Decisions: If promotions are what everybody wants, lay-
offs are what everybody wishes to avoid. But when economic realities force an organization to
downsize, performance appraisal helps make sure that the most talented individuals are
retained and that only the organization's marginal performers are cut loose.

Skills Required: Both the appraiser and the appraisee should have a range of skills in order to
make the best of the appraisal. An appraisal should not involve going round in circles without
getting anywhere.

Job Description:

Meaning & Definition of Job Description

Job description (JD) implies objective listing of the job title, tasks, duties and responsibilities
involved in a job. Job description provides the criteria for evaluating the performance of the job
holder. It is a written statement of what the job holder does, how it is done, under what
conditions it is done and why it is done. It describes what the job is all about, throwing light on
job content, environment and conditions of employment. It is descriptive in nature and defines

21
the purpose and scope of a job. The main purpose of writing a job description is to differentiate
the job from other jobs and state its outer limits.

Contents of Job Description

Job description contains the following:
1) Job Identification: Job identification or organizational position includes the job title,
alternative title, department, division, plant and code number of the job. The job the Identifies
and designates the job properly. The department, division etc. Indicate the name of the
department where it is situated. The location gives the name of the place.
2) Job Summary: Job summary serves two important purposes. Firstly, it provides a short
definition which is useful as additional identification information. Secondly, it serves as the
summary to orient the readers towards understanding detailed information which follows. It
gives the reader a "quick capsule explanation" of the content of a job usually in one or two
sentence.
3) Job Duties and Responsibilities: Job description clearly states the duties and responsibilities
to be performed on the job with proper classification as primary, secondary and other duties. It
is regarded as the heart of a job. It also describes time to be taken in performing the job and
sub-job.
4) Relation to other job: This helps to locate the job in the organization by indicating the job
immediately below or above it in the job hierarchy. It also gives an idea of the vertical
relationship of work and procedures.

Guidelines for Writing Job Descriptions

According to Ernest Dale, the following guidelines should be kept in mind while writing job
descriptions:
I) Job description should indicate the nature and scope of the job, including all important
relationships.
2) It should be brief, factual and precise; use active verbs such as collect mail, sort out mail,
distribute mail, etc. Avoid statements of opinion. Give a clear picture of the job; explain all the
duties and responsibilities of the job in greater detail.
3) More specific words he chosen to show
4) The kind of work,
5) The degree of complexity,
6) The degree of skill required,
7) The extent to which problems are standardized and
8) The degree and type of accountability.
9) The extent of supervision available should also be clearly stated.
10) The reporting relationships must also be clearly indicated (e.g., who
reports to whom, frequency, etc.).

Uses of Job Description

Following are the uses of job description:
I) Helps to Develop Job Specifications: It aids in the development of job specifications which
are useful in planning, recruitment, training and hiring

22
people with required skills.
2) Used for Group Discussion: Preliminary drafts can be used as a basis for productive group
discussion, particularly of the process starts at the executive level.
3) Orient New-Employees: It can be used to orient new-employees towards basic
responsibilities and duties.
4) Used to Develop Performance Standards: It is basic documents used in developing
performance standards.
5) Used for Job Evaluation: It can be used for job evaluation, a wage and salary administration
techniques.
6) Helps a Manager during Interview: A job description enables the manager to frame suitable
questions to be asked during an interview.
7) Vehicle for Organizational Changes: A job description becomes a vehicle for organizational
changes and improvement. It helps top executives in fixing responsibilities.

Job Specification

Meaning & Definition of Job Specification

Job specification or job requirements describe the personal qualities, traits, skills, knowledge
and background necessary for getting the job done. According to Dale Yoder, "Job specification
as a summary is a specialized job description, emphasizing personnel requirements and
designed specially to facilitate selection and placements".

Meaning & Definition of Job Specification

Job specification or job requirements describe the personal qualities, traits, skills, knowledge
and background necessary for getting the job done. According to Dale Yoder, "Job specification
as a summary is a specialized job description, emphasizing personnel requirements and
designed specially to facilitate selection and placements".

Nature of Job Specifications

1) Job specification tells what kind of person to recruit and for what qualities that person
should be tested.
2) Job specification translates the job description into terms of the human qualifications which
are required for a successful performance of a job. They guide in hiring and job evaluation.
3) Job specifications are developed with the cooperation of the personnel department and
various supervisors in the whole organization. The personnel department coordinates the
writing of job description and job specification and secures agreement on the qualifications
required.

Writing Job Specifications

The major steps in writing job description are as follows:
1) Specifications for Trained versus Untrained Pesunnel: Writing job specifications for trained
employees is relatively straig:tiforward. For example, suppose one want to fill a position for an
accountant (or counselor or programmer). In cases like these, job specifications might focus
mostly on traits like length of previous service, quality of relevant training, and previous job
23
performance. Thus, it is usually not too difficult to determine the human requirements for
placing already trained people on a job. "Me problems are more complex when filling jobs with
untrained people (with the intention of training them on the job). One specify qualities
such as physical traits, personality, interests, or skills that imply some potential for performing
or for being trained to do the job.
2) Specifications Based on Judgment: Most job specifications come from the educated guesses
of reoplc like supervisors and human resource managers.

Uses of Job Specification

1) Find-Out Prospective Candidate: Job specification plays an important role in finding-out
prospective employees to a particular job. The specifications help to evaluate curriculum vitae
more speedily and ruthlessly, as well as providing a list of pertinent questions for interview.
2) Importance of Job Specification also Reflect in Attracting Candidate: A job specification will
be the first introduction to candidate. [t is therefore crucial that it is professional and portrays
the right image. So writing a dynamic and accurate job specification will be attracting the
appropriate candidate

Appraisal Methods:

There are two methods of performance appraisal:

1) Traditional Methods/Past-Oriented Methods.
2) Modern Methods/Future-Oriented Methods.

Traditional Methods/ Past-Oriented Methods

Traditional methods of performance appraisal include the following:
1) Graphic Rating Scale (GRS)
2) Straight Ranking Method
3) Paired Comparison Method
4) Critical Incident Method
5) Confidential Reports
6) Group Appraisal
Graphic Rating Scales
A Graphic Rating Scale (GRS) also known as linear or simple rating scale presents appraisers
with a list of traits assumed to be necessary to successful job performance (e.g.,
cooperativeness, adaptability, maturity, motivation). A five- or seven-point rating scale
accompanies each trait. Numbers and/or descriptive words or phrases that indicate the level of
performance define the points along the scale. The midpoint of the scale is usually anchored by
such words as "average", "adequate", "satisfactory", or "meets standards".

Paired Comparison Method

24
This method probably evolved in succession to the straight ranking method in order to provide
a systematic procedure for determining the relative ranks of the people. This may be called
'man- to-man assessment'. It is an appreciable system wherein the persons to be assessed are
compared with each other in pairs, one at a time for different rating. The number of times the
person is compared with that of another has to be tallied on paper. The appraiser is required to
fix some criteria for making his assessment.

Straight Ranking Method

This is the simplest and the oldest method of self-appraisal. With the straight ranking approach,
all employee ,are ranked from 'best' to 'worst' on the basis of comparative overall performance.
The primary attraction of straight ranking is its simplicity. It requires a minimum of bureaucracy
and may be an acceptable solution for small enterprises with just a few employees. Since it
involves rank ordering, it necessarily combats intentional assessment errtift particularly central
tendency and leniency errors.

Critical Incident Method

The critical incident method of performance appraisal involved identifying and describing
specific events (or incidents) where the employee did something really well or something that
needs improvement. It is a technique based on the description of the event, and does not rely
on the assignment of ratings or rankings, although it is occasionally coupled with a ratings type
system.

Group Appraisal
It is gener ally observed that some evaluator s evaluate their employees according to very high
standards though as per the usual practice, this may not be needed. This happens when the
performance of the evaluator himself is outstanding, which is why he expects the same from his
group. In order to overcome this difficulty, the group appraisal method is based on evaluation
of performance by a group of people having knowledge of the job and performance standards.
The evaluator gives the necessary briefing about his employees to the group members. The
group then discusses the standards of performance for the job and the actual performance by
the employees.

Confidential Reports
Assessing the employees' performance confidentially is a traditional method of performance
appraisal. Under this method, superior appraises the performance of his subordinates based on
his observation, judgments, and intuitions. The superior keeps his judgment and report
confidentially. In other words, the superior does not allow the employee to kn ow the report
and his performance. Superior writes the report about his subordinate's strengths, weaknesses,
intelligence, attitude of work, sincerity, commitment, punctuality, attendance, conduct,
character friendliness, etc_ Though confidential report is a traditional method, most of the
public sector organizations still follow this method in appraising employee's performance.

Modern/Future-Oriented Methods of Appraisal

25
Future-oriented methods include the following:
1) Behaviorally Anchored Rating Scales (BARS)
2) Assessment Centers
3) Management by Objectives
4) Psychological Appraisals
5) 360' Performance Appraisal
6) Human Resource Accounting

Behaviorally Anchored Rating Scales (BARS)

BARS sometimes called behavioral expectation scales are rating scales whose scales points are
determined by statements of effective and ineffective behaviors. They are said to be
behaviorally anchored in that the scales represent a range of descriptive statements of
behavior varying from the least to the most effective. A rater must indicate which behavior on
each scale best describes an employee's performance.

Assessment Centers
Mainly used for executive hiring, assessment centers are now being used for evaluating
executive or supervisory potential. An assessment centre is a central location where managers
may come together to have their participation in job. related exercises evaluated by trained
observers. The principal idea is to evaluate managers over a period of time, say one to three
days, by observing (and later evaluating) their behavior across a series of selected exercises or
work samples. Assesses are requested to participate in in-basket exercises, work groups
(without leaders), computer simulations, role playing, and other similar activities which require
the same attributes for successful performance, as in the actual job. After recording their
observations of rate behaviors, the raters meet to discuss these observations. The decision
regarding the performance of each assessee is based upon this discussion of observations.

Management by Objectives (MBO)

It was Peter F. Drucker who first gave the concept of MBO to the world way back in 1954 when
his The Practice of Management was first published. The MBO concept, as was conceived by
Drunker, reflects a management philosophy which values and utilized employee contributions.
Application of MBO in the field of performance appraisal is a recent thinking.

Psychological Appraisals
Large organizations employ full- time industrial psychologists. When psychologists are used for
evaluations, they assess an individual's future potential and not past performance. The
appraisal normally consists of in-depth interviews, psychological tests, discussions with
supervisors and a review of other evaluations. The psychologist then writes an evaluation of the
employee's intellectual, emotional, motivational and other work-related characteristics that
suggest individual potential and may predict future performance.

360-Degree Performance Appraisal

26
The 360-degree performance appraisal is an appraisal system that encompasses views of
employee's superior, co-workers/peers, and customers. Through 360- degree performance
appraisal, the employee has the chance to review the manager, which is not practiced with
traditional performance appraisals. The 360-degree appraisal gathers information from more
than one source. This appraisal system collects information from peers, subordinates,
superiors, and customer (internal and external) so that the employee can get a well-rounded, or
360- degree, view of his performance.

Human Resource Accounting Method

Human resources are a valuable asset of any organization. This asset can be valued in terms of
money. When competent and well -trained employees leave an organization, the human asset
is decreased and vice versa. Human resource accounting deals with cost of and contribution of
human resources to the organization. Cost of the employee includes cost of manpower
planning, recruitment, selection, induction, placement, training, development, wages and
benefits etc. Employee contribution is the money value of employee service which can be
measured by labor productivity or value added by human resources. Difference between cost
and contribution will reflect the performance of employees.

Rater Errors
A rater error is an error in performance appraisal that reflects consistent biases on the part of
the rater. Some of the most common rate errors are:
1) Halo Effect: Halo effect occurs when a rater attaches too much significance to a single factor
of performance and gives similar ratings on other performance elements. Thus, overall
evaluation is significantly influenced by a single factor. Such a perception undermines the
importance of other elements and leads to an unbalanced performance assessment of the
individual. For example, a manager rates a worker eery high on quality because of her
immaculate attention to details and of defects in her work. Then assuming the individual to be
an overall high performer based on the quality of his/her work output, the manager rates her
very high on efficiency, responsibility, punctuality, etc., without taking an objective look at her
performance in these areas.
2) Strictness, Leniency, and Central Tendency Bias: People differ in their tendency to evaluate
people or performance. Some supervisors are very strict or conservative in their ratings and
generally give low scores in their evaluations. This tendency may make high performers attain
somewhat average ranking and average performers appear as poor performers. Raters with
such tendency are known to have a strictness bias.

Data Collection
Performance evaluations should not be a one time event. Supervisors are encouraged to gather
data regarding employee performance in a systematic manner throughout the year. The
Performance Record and the Coaching Log are guides that can he used by supervisors, in
addition to their own best practices, to gather data throughout the year and provide ongoing

27
feedback to employees regarding performance. This information will then be available to
supervisors when drafting the annual performance evaluation.
Questionnaire: This method is usually used to obtain information about jobs through a mail
survey. The job incumbents who can easily express themselves in writing are asked to provide
date about their jobs in their own words. This method is, therefore, best suited to clerical
workers. But it is often a very time consuming and laborious process to analyze the data
obtained in this manner.

Observation: This method can be followed right on eh job. The analyst observes the incumbent
as he performs his work and questions him to get the required data. Besides being slow and
costly, this method also interferes with normal work operations. However, it generally produces
a good and complete job description. This method is particularly desirable where manual
operations are prominent and where the work cycle is short. Working conditions and hazards
can also be better described when observed personally by the analyst.

Interview: In this method a group of representative job incumbents are selected for extensive
interview usually outside of the actual job situation. The interview may be carried out either
individually on in a group to save time. The replies obtained from the interviewees are then
combined into a single job description. This method though very costly and time consuming
helps in getting a complete picture of the job.

Participation: In this method the job analyst actually performs the job himself. In this way he is
able to, obtain first-hand information about what - characteristics comprise the job under
investigation.

Conducting an Appraisal Interview:

An appraisal culminates in an appraisal interview. Appraisal interview has been considered by

most of the organizations, as well as employees, as the most essential part of appraisal system.
This interview provides the employee the feedback information, and an opportunity to the
appraiser to explain the employee his rating, the traits and behavior he has taken into
consideration for appraisal etc. Few people like to receive or give negative feedback. So,
adequate preparation and implementation is necessary.

How to Conduct the Appraisal Interview?

Preparation is essential. Review the person's job description, compare performance to the
standards, and review the employee's previous appraisals. Give the employee atleast a week's
notice to review his or her work, analyze problems, and gather questions and comments.Find a
mutually agreeable time for the interview and allow enough time for the entire interview.
Interviews with lower-level personnel like clerical workers and maintenance staff should take
no more than an hour. Interviews with management employees often take two or three hours.
Be sure the interview is done in a private place where you would not be
Interrupted.

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Guidelines while Conducting Appraisal Interview
There are four things to keep mind when actually conducting the interview:
I) Talk in Terms of Objective Work Data: Use examples such as absences, tardiness, quality
records, orders processed, productivity records, order processing time., accident reports, and
so on.
2) Don't Get Personal: Don't say, "You are too show in producing those reports". Instead, try to
compare the persons's performance to a standard. (These reports should normally be done
within 10 days.") Similarly, do not compare the persons's performance to that of other people.
("He is quicker than you arc')

How to Ensure the Interview Leads to Improved

Performance?
Many managers bring to the appraisal an erroneous (and unstated) assumption that simply
revealing the gap between where the employee should be and is, will trigger improved
performance. But in most human endeavors, that is not enough. For example, if getting
someone to lose weight merely required a scale, there'd be little need for all there diet
programs on the market. Similarly, identifying the gap is just the first step in improving an
employee's performance. Doing so often requires providing the tools and support the
person needs to move ahead. Here, clearing-up job-related problems with the employee and
setting measurable performance targets and a schedule for achieving them - an action plan -
are essential

Follow Up and Validation:

Any recommendations for action that have been made in the appraisal must be followed-up.
If the appraisal identifies training needs then these needs should be met as soon as practical.
There is little point in identifying an immediate training need and then not providing the
training for 12 months. How can the individual be expected to perform if they do not have the
opportunity to develop their skills? It might save the cost of the training course but it is
potentially 12 months' extra productivity lost, and that productivity is likely to be worth much
more than the cost of the training. There is also the danger of demotivating the employee by
recognizing a training and then failing to provide it. Providing appropriate training is parti
cularly important in jobs where there is rapidly changing technology. For example, a computer
programmer will need regular training to keep up-to-date with the latest programming
languages and development. It is widely acknowledged that an organization which fails to keep-
up with changes in technology is likely to be unsuccessful – but there is little point in keeping-
up with technology if employees do not receive appropriate training. Appraisal will help to
ensure that training keeps pace with changes in technology.
Making Recommendations

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If the appraiser is only able to recommend training rather than authorize it. Then the appraiser
should make sure they put forward the recommendations quickly, to ensure that the
organization can set-up the training quickly. if for some reason the organization refuses to
authorize the training, then the appraise should be told immediately, and provided with the
reasons why the training is not forthcoming. They can then appeal against this if they feel it is
appropriate. After all, the decision to recommend training will have been based on a detailed
discussion during the appraisal, so the organization will need to have very good reasons why
they should not receive that training.
Importance of Follow-Up
By following-up all the recommendations of the appraisal, the organization is showing the
employee that they are important. The appraisal should show this, by not only assessing
performance against objectives, but also assessing individual needs – e.g., ensuring the work-
life balance is met – and providing for these needs.

How to Validate the System?

The organization should consult with employees regarding the appraisal system; how it works,
where it does not work well. If the organization does not consult with employees the system
will not be accepted, and the organization will be seen as uncaring about its staff. After all,
employees are the ones who use the system, and they are likely to know best about why it
works or why it does not work.
There are several ways in which the organization can validate the system. The most important
are:
I) Detailed Interviewing,
2) Questionnaires.
1) Detailed Interviewing: Interviewing is time-consuming, and there may be issues of
confidentiality; but interviews are very effective. In order to carry-out the validation, accurate
records need to be kept. The records include those which are kept in the employee's personal
file, alongwith the job descriptions and person specifications for the job. There are also the
detailed records of the appraisal itself, the preappraisal reports, the appraisal reports, and any
records of job performance

2) Questionnaires: Questionnaires are faster; the organization can obtain information from a
large sample quickly, but will not provide as much depth of information. Validation should be
carried-out regularly, to ensure the smooth working of the appraisal system. Remember, the
appraisal system should belong to the employees of the organization. It should not be imposed
on them, so introducing this kind of consultation will help to ensure that employees feel that
the system is theirs – which it is,

Present Thoughts and Future Directions:

Present thoughts and future directions emphasize on the following issues:

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1) What is the state of appraisal?
2) Work-life balance,
3) Legal and ethical issues,

1) What is the State of Appraisal?

Staff appraisal has many supporters and perhaps even more detractor s. Some argue that it is
essential to organizational effectiveness; others argue that is should be done away with as
a waste of money. Unfortunately, research into the effectiveness of staff.
2) Work-Life Balance: The work-life balance has taken on an increasing importance in the last
few years, with both forward-thinking organizations and the British Government recognizing
that we have to take into account the personal and individual needs of employees; that by
taking these needs into account the person will have higher job satisfaction and be more
productive. There are moves both nationally and internationally to reduce working hours.

Legal and Ethical Issues: It is important to ensure that there is a fair appraisal system,
otherwise there ate potential legal issues. For example, an employee could leave and claim
constructive or unfair dismissal if they thought the appraisal was conducted unreasonably. Also,
if the employer has a contractual appraisal system then if they fail to follow it there could
be legal consequences. It i s important to ensure that the system does not discriminate on
race, sex, marital status, or disability.

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 MODULE 3
Performance management & employee development

Personal Development plans:

Personal development plans are perhaps the most important output of performance
management processes. They are agreed during performance and development review
meetings and progress in implementing them is reviewed at consequent meetings, although
progress should also be monitored continuously.

Development Plan Objectives:

A personal development plan may concentrate on the development required to improve

performance in the current job. It may extend to the development required for future career
moves and is thus part of a career development program. Career moves could be by promotion
or by lateral development to gain expertise in new areas of work. The latter is particularly
important in smaller organizations when there are limited opportunities for promotion but
more scope for lateral development.
1) Improve Performance in Current Job: A good performance and development plan helps
employees to meet performance standards. Thus, a performance and development plan
includes suggested courses of action to address each of the performance dimensions that are
deficient.
2) Sustain Performance in Current Job: A good performance and development plan provides
tools so that employees can continue to meet and exceed expectations regarding the current
job. Thus, the plan includes suggestions about how to continue to meet and exceed
expectations for each of the performance dimensions included in the appraisal form.
3) Prepare Employees for Advancement: A good performance and development plan includes
advice and courses of action that should be taken so that employees will be able to take
advantage of future opportunities and career advancement. Specifically, a good plan indicates
which new competencies and behaviors should be learned to help with career advancement.
4) Enrich the Employee's Work Experience: Even if career opportunities within the organization
are not readily available, a good plan provides employees with growth opportunities and
opportunities to learn new skills. These opportunities provide employees with intrinsic rewards
and a more challenging work experience, even if the new skills learned arc not a formal part of
their jobs. Such opportunities can make jobs more attractive and serve as a powerful employee

32
retention tool. In addition, the new skills can be useful in case of lateral transfers within the
organization.
5) Optimal results: It helps in integrating internal and external and inhibiting factors with
individual efforts

Content of Developmental Plan:

Plans should include a description of specific steps to be taken and specific objectives to reach.
In other words, what is the new skill or knowledge that will be acquired and how will this
occur? This includes information on the resources and strategies that will be used to achieve
the objectives. For example, will the employee learn the skill from a co-worker through another
job training? Will the company reimburse the employee for expenses associated with taking an
online course? The plan's objectives should include not only the end product, such as the
newskills to be learned, but also the completion date and how the supervisor will know
whether the new skill has indeed been acquired. Overall, objectives included in the
developmental' plans should be practical, specific, time-oriented, linked to a standard, and
developed jointly by the supervisor and the employee.

Preparing a Personal Development Plan:

Personal development plans are prepared on the basis of the outcome of performance and
development reviews. These consist of a joint examination of progress and achievements —
comparing what people have done and how they were expected to do it.
In other words, the objectives they have attained and the capabilities they have demonstrated.
The personal development plan, as its name implies, is very much the property of individuals.
They have to set the direction in which they want to develop and decide on the actions
required to get there. The role of manager is to provide guidance as necessary in preparing the
plan and to support them when it comes to implementation. Of course, you should also
monitor progress and stimulate action or provide further support as required. The steps
required to prepare a personal development plan are:
1) Identify development needs: these can be defined in terms of knowledge skills and
capabilities competencies). These needs should be specified as precisely as possible in terms of
what people have to know and be able to do when the plan has been implemented.
2) Set Goals for Meeting these Needs (Personal Development Objectives): These can be defined
under headings such as:
i) The extension of relevant knowledge.
ii) The improvement or acquisition of skills, especially transferable skills, which will enable them
to ex t end their role and take on new responsibilities.
iii) The development of specified areas of capability or competence.
iv) Enlarging the current role.
v) Working towards future developments in the current role.
vi) Extending a career laterally across the organization to roles at broadly the same level but
which will enrich the individuals expertise and capabilities.
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vii) Increasing potential for provision in general or, possibly, in a specified ,direction.
3) Prepare Action Plans for Meeting the Development Needs: Action plans specify both the
means by which needs will be satisfied and how individuals and their managers will check that
they have been met. The areas could include any of the following:
Y'' 'Learning new skills or improving existing skills dur ing the normal course of work, with
coaching as appropriate from managers, team- leader s, mentors or specialized t r ainer s (
learning on the job).
ii) Taking on additional responsibilities or moving to a different role in the team (job rotation)
and acquiring additional skills (multi-skilling) through coaching and with the help of co-workers.
iii) Being appointed a member of a project team to develop something new, to achieve a task or
to solve a problem, extending knowledge and skills through their experience (learning on the
project) with guidance and coaching as required.
iv) Spare- time study to learn new skills, acquire extra knowledge, or obtain a qualification
(distance learning, guided reading, attending
courses provided by local educational institutions).
v) Attending in-company or external training courses designed to help people in learning new
skills and/or increase knowledge.
vi) Action learning programs.
4) Implement the Plans: Individuals should be encouraged, or indeed, expected to monitor their
own progress but their managers should review how things are going from time-to-time.
5) Evaluate: Evaluate the outcome of the personal development plan and decide if anything
more is needed to be done in any existing or new area.

360 dergree feedback:

Meaning of 360 Degree Feedback
360- degree feedback is can be defined as the systematic collection and feedback of
performance data on an individual or group derived from a number of the stakeholders in their
performance. This technique measures in detail the behaviors and competencir shown by the
individual or group in achieving goals. Participants can be confidentially assessed by
themselves, their boss, their staff, team members, internal/external customers, suppliers,
family and friends.

Objectives of 360-Degree Feed back

The objectives of the '361 Degree Feedback" system can therefore, be summarized as follows:
I) Identification of developmental needs and preparation of development plans more
objectively in relation to current or future roles, to facilitate performance improvements for an
individual or a group of individuals.
2) Provision of insights into the strong and weak areas of a candid late in terms of the effective
performance of roles, activities, styles, traits, qualities, competencies, etc.
3) Impact of knowledge, attitude, and skills.

34
4) Reinforcement other change management efforts and interventions directed at organization
effectiveness. These may include: TQM efforts, customer focused or internal customer
satisfaction enhancing interventions, flat structures, quality-enhancing and cost-reducing
interventions, decision process changes, etc.

360-Degree Feedback as a Developmental Tool

"360 Degree Feedback" is used purely as a developmental tool instead of as a method of
performance appraisal.
"360 Degree Feedback" is a developmental device to a method of appraisal. It can be treated as
an assessment-oriented approach to appraisal. There has been remarkable progress in the
adoption of this system by various organizations as more and more of them are getting
attracted towards it because it facilitates a shift towards a less hierarchical, more flexibly
structured and knowledge-based on organizations of future also a powerful developmental tool
because when conducted at regular intervals (say yearly) it helps to keep a track of the changes
others' perceptions about the employees. A 360-degree appraisal is generally found more
suitable for the managers as it helps to assess their leadership and managing styles. This
technique is being effectively used across the globe for performance appraisals. Some of the
organizations following it are Wipro, Infosys, and Reliance Industries, etc.

Advantages of 360-Degree Feedback System:

The advantages of 360-degree feedback system are:

1) Improved Feedback from More Sources: This is a participative method of employee
assessment. It provides a well- rounded feedback from many sources, such as peers, reporting
staff, co-workers, and supervisors. This broadbased assessment is better than that from a single
supervisor. It can save the managers' time, as they would be spending less time and energy for
providing feedback. For co-workers also this is an opportunity to be more objective while
assessing their peers. The recipient employees gain as it helps people to understand how other
employees view their work.
2) Team Development: I t helps team member s , learn to work more effectively together.
Teams know more about how their members are performing than their supervisor. It makes
team members more accountable to each other as they share the knowledge that they will
provide input on each member's performance. A well-planned process can improve
communication and team development.
3) Personal and Organizational Performance Development: 360-degree feedback is one of the
best methods for understanding personal and organizational developmental needs.
4) Responsibility for Career Development: The Individual employees can take charge of their
career development program, as they are directly informed by many sources about where they
need to focus. This is more so, because the employees feel that this method is more accurate
and dependable than the traditional evaluation by the supervisor.
5) Reduced Discrimination Risk: When feedback comes from a number of individuals in various
job functions, discrimination because of race, age, gender, and so on, is reduced.

35
6) Improved Customer Service: As this process involves the internal or external customer, each
person receives valuable feedback about the quality of his product or services. This would
enable the individual employee to improve his contribution towards the quality, reliability,
promptness, and comprehensiveness of the products and services.
7) Training needs assessment: 360-degree feedback provides: comprehensive information about
organization training needs and thus allows planning for courses regarding cross-functional
responsibilities.

Disadvantages of 360-Degree Feedback System:

The disadvantages of .160-degree feedback system are:

I) Expeem Hints by the Managements: The managements expect too much from this system, as
those who propose this may put too much emphasis on it to gain support from the
management. It should be remembered that 360-degree feedback is not the same as a
performance management system. It is merely a part of the feedback and development system.
2) Problems in Designing the System: Often, a 360-degree feedback process is introduced with a
recommeedation from the HR department or is promoted by an executive who had learnt
about it from a seminar or a book. These recommendations could be very far removed from the
ground realities in the organization. To be effective, it should incorporate effective change
management guidelines and it should be reviewed by a cross - section of management and
employees and discussed at length before any decision is taken in this regard.
3) Failure to Link the Process with the Strategy of the Organization: It will fail if it is viewed as an
additional system for employee assessment. On the other hand, it must be linked with the
overall long-term strategic aims of the organization. It should be treated as a support system to
give specific inputs for the organizational strategy, the big picture and as a guide for the
organization to measure its accomplishments in relation to its goals. For example, if the
organization has identified the requisite skills and competencies to reach the goal, the
employees should get the feedback on their skills, competencies, and performance.
4) Insufficient Information: Since 360 -degree feedback processes are usually anonymous,
employees receiving the feedback have no way of getting further clarifications even if it is
crucial. Ilene, it does not prevent employees from giving unpleasant remarks, thus crushing the
motivation of the employees. Under these circumstances, it is imperative to train the
Supervisors, HR staff people, interested managers, and others to assist the employees to
understand their feedback. The elaborate training should also include aspects such as
developing action plans based upon the feedback.
5) Focus on Weaknesses: It 'nay focus too much on the negative aspects of employee
performance, totally ignoring the achievements. This could be dangerous for employee.
6) Raters may not he Chosen Properly: The raters chosen for this may not have the requisite
experience. Or if very senior managers with expertise are chosen, they may not have the titre
or the inclination and so may take this assignment lightly. 'Him ate numerous ways the raters
can go wrong.

Performance Management & Reward System:

36
Reward System:
Reward system in the context of performance management is defined as an
integrated system that ensures equitable avenues to employees for fulfillment of
t h e ir f in an c ial an d n o n - f in an ci al n e e d s an d re co gn it io n u rge f o r t h e ir
contribution to attainment of organizational goals.

An employee reward system consists of an organization's integrated policies,

processes and practices for rewarding its employees in accordance with their
contribution, skill and competence and their market worth. It is developed
within the framework of the organization's reward philosophy, strategies and
policies and contains arrangements in the form of processes, practice s,
structures and procedures which will provide and maintain appropriate types and
levels of pay, benefits and other forms of reward.

Characteristics of Reward System:

Performance-stimulated reward system possesses the following

characteristics:

1) Re ward emp hasiz es no t on ly fin an cial co mpen sation, b ut also n on financial

rewards like enrichment of job, work autonomy/freedom, company
sponsored family tours, best employee awards and popularization of employee
achievements in house journals, etc.
2) Rewards must be offered in proportion to respective employee
contribution/services in fulfillment of organizational responsibilities and
achievement of organizational goals.
3) Reward must be equitable implying that there should be equilibrium in reward
offered to an employee in comparison to others.
4) Reward must be integrated i mplying that there must be balance and
comprehensiveness in design and application of the reward management
strategy.

Elements of Reward System

I) Base Pay: Base (or basic) pay is the level of pay (the fixed salary or wage) that
constitutes the rate for the job. It may provide the platform for determining
additional payments related to performance, competence or skill. It may also
govern pension entitlement and life insurance. The basic levels of pay for jobs
reflect both internal and external relativities. The internal relativities may be
measured by some form of job evaluation which places jobs in a hierarchy

37
 (although the trend now is to play down the notion of hierarchy in the new process -
based organizations). External relativities are assessed by tracking market rates.
2) Contingent Pay: Additional financial rewards maybe provided that are related
to performance, competence, contribution, skill and/or experience. These are
referred to as 'contingent pay'. if such payments are not consolidated into
base pay, they can be described as 'variable pay'. Variable pay is sometimes
defined as 'pay at risk'. For example, the pay of sales representatives on a
`commission-only' basis is entirely at risk.
The main types of contingent pay are:
i) Individual Performance -Related Pay: In which increases in base pay or cash
bonuses are determined by performance assessment and ratings (also known as merit
pay).
ii) Bonuses: Rewards for successful performance which are paid as cash (lump) sums
related to the results obtained by individual teams or the organization.
iii) Incentives: Payments linked with the achievement of previously set targets which are
designed to motivate people to achieve higher level s of performance; the targets are
usually quantified in such terms as output or sales.
3) Allowances: Allowances are elements of pay in the form of a separate sum of money for
such aspects of employment as overtime, shift working, call-outs and living in London or
other large cities. London or large-city allowances are sometimes consolidated;
organizations which are simplifying their pay structure may 'buy out' the allowance
and increase base pay accordingly.
4) 'Total Earnings: Total earnings are usually calculated as the sum of base pay and any'
additional payments. .
5) Employee Benefits: Employee benefits, also known as indirect pay, include
pensions, sick pay, insurance cover and company cars, They comprise elements of
remuneration additional to the various forms of cash pay and also include
provisions for employees that are not strictly remuneration, such as annual
holidays.
6) Total Remuneration: Total remuneration is the value of all cash payments (Total
earnings) and benefits received by employees.

Essentials of Reward System in Performance Management

Performance-based reward and compensation opportunities are highly effective in

developing th e performance of employees. Therefore, a performance -oriented
compensation system seeks to achieve the following:

1) Cost-effectiveness for the organ ization,

2) Internal, external, and individual equity for employees, and

38
3) Performance excellence for the organization.

Techniques of Designing a Reward System

1) Job Evaluation: This is a popularly employed technique to establish relative worth of jobs
in an organization for the purpose of determining pay. Job evaluation process
identifies contribution of each job for organizational functioning and effectiveness. Job
evaluation also determines:

i) Skills required to perform a job,

ii) Degree of responsibility involved,
iii) Effort required to perform the job, and
iv) Related working conditions.
Information as obtained, forms the basis for establishing compensation. There are four
techniques that are used as a part of job evaluation exercise. These are:Job ranking method,
Classification, Factor comparison, Point system.

Application of one or more of these job evaluation techniques yields valuable

information that can be effectively used to establish logical comparison and relative worth of
jobs in order to determine compensation level correspondingly.

2) Hay Guide Chart Profile Method: This is one of the techniques used in On of jobs. This is
similar to the point method but a more reliable isticated technique. Hay guide determines the
worth of a job based on four vital parameters. These are: Know-how: Knowledge and skills
required to perform job effectively. Problem-Solving: Abilities related to analyzing,
reasoning, evaluating, developing solutions and making execution plans. Ability:
Additional compensable elements such as unique and ea ceptional condition s in
which a job is to be performed.These parameters are broken into further measurable
elements_ Points are accorded to each of these elements that form the basis for establishing
said relative worth of a job.
3) Gain-Sharing Techniques: Gain-sharing plans are primarily employed to distribute
benefits of cost-cutting interventions, increased production, increased quality,
etc., to employees organization-wide. However, gain-sharing techniques are more
often used for enhancing production than anything else. Basically, there are four
techniques in gain-sharing. These are as follows:

i) Lincoln Electric Plan: This plan is named after its author John Lincoln. This technique
comprises four fundamental principles such as:
39
 a) There is no basic pay and only piecework pay,
b) No mandatory retirements implying that as long as an employee is producing
he/she continues in employment,
c) No pre-requisites, leaves, bonus, and
d) Employees who have worked for more than two years cannot be laid off.
In brief, this is a technique that provides for compensation in lump-sum,
proportionate to the service rendered. This means there will be a direct relationship
between compensation and results.

ii) Scanlon Plan: This is also named after its author Joe Scanlon. This technique
comprises activities such as suggestion, group incentive and employee participation.
Employees are organized into teams and whichever team invents and practices
methods to reduce waste, save time and increase productivity, is rewarded. This is a
comprehensive technique because it allows employees to participate and influence
decision-making.

iii) Rucker Plan: Like the Scanlon plan, this plan also promotes suggestions
from employees and their participation in improving productivity. But this plan
provides limited freedom to employees to participate in organizational decision-making.
Here employees give suggestions, which are evaluated by a screening committee
before they are adapted. Proportionate monetary reward is offered to employees if
their suggestions result in profits to the organization.

iv) Improshare: This technique is derived from consultative style of management.

Here employees do not have scope for participation or involvement, but managers in
the process of improving production and efficiency consult them. Employees are
offered bonus compensation if that.cores ithati on process results in the organization
making profits.

I m p l i c a t i o n s o f P e r f o r m a n c e M a n a g e m e n t o n Organizational Reward System

Reward management plays a pivotal role in improving organizational performance

by:
1. Stimulating by bringing forward new ideas.
2. Promoting commitment.
3. Motivating the business development team.
4. Attracting 'talents' into the organization at all levels from both internal and external
sources.
5. Communicating a change in organizational values in conjunction with
requirements of environment from time-to-time.

40
 6. Rewarding exceptional value creation.
7. Linking incentives to key business, development goals, including new ones.
8. Ensuring reward systems are appropriate to attract the right talent to the organization
at the right time.

Performance linked remuneration system:

Contingent Pay

Contingent pay (CP) is any form of financial reward that is added to the base rate or paid
as a cash bonus and is related to performance, competence, skill or services

Contingent pay is used as a means of incentivizing workers and promoting shared

interests in higher output, productivity, customer satisfaction, and other indicators of business
success.

Selecting a Contingent Pay Plan

A critical issue to consider is that of organizational culture. An organization's culture is

defined by its unwritten rules and procedures. For example, is the organization
fundamentally built around individual performance, or is teamwork the norm? Is the
organization one in which high-level performers are regarded as role models who should be
emulated, or are they viewed as a threat to upper management? Are we happy with the
current culture, or do we wish to change it? CP plans are powerful tools that help solidify
the current culture, and that can be used to create a new type of culture. There should be a
careful consideration of the culture of the organization before a specific type of CP plan is
selected.
Consider the types of systems that can be implemented in cultures that we can label
traditional or involvement cultures. Traditional cultures are characterized by top-down
decision-making, vertical communication, and clearly defined jobs. What type of plan
should be implemented in organizations with this type of culture? An effective choice would
be a plan that rewards specific and observable measures of performance, where that
performance is clearly defined and directly linked to pay. Examples of such CP systems are the
following:

1) Piece gate: Employees are paid based on the number of units produced or repaired.
This system is usually implemented in manufacturing environments. In service
organizations, this could involve the number of calls made or the number of clients, or
potential clients, contacted. This system is usually implemented in call centers.

41
2) Sales Commissions: Employees are paid based on a percentage of sales. THis system is
usually implemented in car dealerships.

3) Group Incentives: Employees are paid based on extra group production based on
result-oriented measures (e.g., sales volume for the group).This system is
implemented frequently in the retail industry.
Involvement culture is „different from traditional culture. Organizations with Involvement
cultures are characterized by shared decision-making, lateral communications, and
loosely defined roles. Examples of systems that work with in organizations with
involvement cultures are the following:

1) Profit Sharing: Employees are paid based on the performance of a group (e.g., team
or unit) and on whether the group has exceeded a specific financial goal. This type of
system is implemented in many large law firms.
2) Skill-Based Pay: Employees are paid based on whether they acquire new knowledge
and skills that are beneficial to the organization. This type of system is usually
implemented in knowledge-based organizations such as software development
companies.
In addition to the organization's culture, an important consideration in selecting a CP
plan is the organization's strategic direction. Strategy is not only a key element in
designing the performance management system; it is also a key element in designing
a CP plan.

If employee development is a key strategic priority, rewards should emphasize new

skills acquired. If customer service is a priority, then rewards should emphasize
competencies related to customer service and gain sharing. Gain sharing links
individual and group pay to an organization's overall profitability: the greater the
organization's overall profit, the greater the rewards given to individuals and teams in
the organization. In this case, gain sharing would be based on whether customer service
ratings improve during the review period. If the major goal of the CP plan is to increase
the organization's overall profit, choices include executive pay and profit or stock
sharing. Executive pay includes cash bonuses that are given in response to successful
organizational performance.

Possible Problems Associated with Contingent Pay plans

1) Poor Performance Management System is in Place: When a CP plan is paired with a

poorly designed, poorly implemented performance manage- ment system, one that
includes biased ratings and the measurement of unrelated performance
dimensions may lead some employees to challenge the CP plan legally. Also,
rewarding behaviors and results that are not job related is likely to cause good

42
 performers to leave the organization. Finally, those who stay are not likely to be
motivated to perform well.
2) There is the Folly of Rewarding a while hoping for B: When the system rewards
results and behaviors that are not those that will help the organiza- t i o n s u c c e e d
e m p l o y e e s a r e l i k e l y t o e n g a g e i n t h e s e o f t e n counterproductive behaviors
when this behavior is what will earn them the desired rewards. One such example is the
hope that executives will focus on long-term growth and environmental responsibility
when, in fact, they are rewarded based on quarterly earnings. Given this situation,
what are these executives likely to do? Will they think in the long term, or quarter by
quarter?
3) Rewards are not Considered Significant: When a CP plan includes pay increases,
and other rewards, that are so small that they don't differentiate between
outstanding and poor performers. Rewards are not viewed as performance-based
rewards, and they do not make an impact. The message sent to employee is that
performance is not something worth being rewarded. For rewards to be
meaningful, they need to be significant in the eyes of the employees. Usually, an
increase of approximately 12%-15% of one's salary is regarded as a meaningful reward
and would motivate people to do things they would not do otherwise.
4) Managers are not Accountable: When managers are not accountable regarding
how they handle the performance and the performance evaluation of their
employees they are likely to inflate ratings so that employees receive what the
manager thinks are appropriate rewards.

Performance Linked Career Planning & Promotion Policy:

Performance appraisal is a part of career development. The latest mantra being followed by
organizations across the world being – "get paid according to what you contribute" –
the focus of the organizations is turning to performance management and
specifically to individual performance. Performance appraisal helps to rate the
performance of the employees and evaluate their contribution towards the
organizational goals. Performance appraisal as career development leads to the
recognition of the work done by the employees, many a times by the means of rewards
and appreciation, etc. It plays the role of the link between the organization and the
employees' personal career goals.

Potential appraisal, a part of performance appraisal, helps to identify the hidden talents
and potential of the individuals. Identifying these potential talents can help in
preparing the individuals for higher responsibilities-and positions in the future. The
performance appraisal process in itself is developmental in nature.

43
Performance appraisal is also closely linked to other HR processes like helps to identify the
training and development needs, promotions, demotions, changes in the
compensation, etc. A feedback communicated in a positive manner goes a long way to
motivate the employees and helps to identify individual career developmental plans.
Based on the evaluation, employees can develop their career goals, achieve new
levels of competencies and chart their career progression. Performance appraisal
encourages employees to reinforce their strengths and overcome their weaknesses.

Policy Objectives:

1) To integrate the growth opportunities of the executives with the fulfillment of the
Company's objectives.
2) To identify, train, and develop competent personnel with growth potential and to
provide a policy environment for high levels of performance.
3) To provide a system of equality in opportunity, equity in assessment arc uniformity in
implementation among ail the Units, Business Groups Directorates, and Officers of the
company in the matter of promotion.
4) To seek and provide a continuous team of work sustained high levels o competence in the
company.

Scope

This Promotion Policy shall cover all promotions made in PS Grade posts arse shall apply
to all Units, Business Groups/Functional Directorates, Corporate and other Offices of the
company.

Definitions

1) Cadre: 'Cadre' means a group of grade put together for purposes o

consideration for promotion specifically at the unit or corporate level, to the case
may be.
2) Eligibility: 'Eligibility' means fulfillment of standards laid-down fo various norms
such as qualification, attendance, performance appraisal etc., as shall be prescribed
by the management from time-to-time.
3) Group: 'Group' means a grade or a set of grades codified for the purpose of
promotion.
4) Outstanding: 'Outstanding' means a Total Appraisal Score of more tha 200 for three
consecutive years in Performance Appraisal.
5) Promotion: 'Promotion' means placement of an employee in th immediate
higher grade within the group or between the groups.
6) Qualifying Period: 'Qualifying Period' means the number of years k minimum

44
 service prescribed for promotion from one grade to another froi time-to-time.

Cadres
The PS Grades shall be divided into two broad cadres:

1) The unit cadre comprising executives in the Scales PS Ito PS VI.

2) The corporate cadre comprising executives in the Scales PS VII and abov,
Promotion in the Unit Cadre shall be organized in respective Units. Promotion in
the Corporate Cadre shall be organized in the Corporate Office.

Promotion System

There shall be two systems of promotion within the executive positions in the company:

1)Promotions with in the groups,

2) Promotions between the groups.
All the promotions made in accordance with this Promotion Policy will be from ore scale of
pay to next without skipping any scale of pay.

Promotion Norms:

The promotion norms shall consist of two parts:

1) Eli!tibilIity Factors: Which include a qualifying period, qualification norms, attendance,

conduct, prescribed standards in Performance Appraisal.

2) Suitability Factors: Which include an interview and art assessment of the potential
ofthe executive in his own channel of promotion or for a post other than in his own
channel of promotion.

Promotions within the Groups:

These promotions shall be made in accordance with the above eligibility and suitability
factors and will be based on the availability of vacancies and the organizational need to
fill-up such vacancies. In considering the promotion of an executive from one group
to another, merit will be the primary consideration, which will include an assessment
of the executive's potential and aptitude for higher managerial position.

Outstanding Performers: Executives who have outstanding reports for three consecutive
years shall be considered for promotion in accordance with the qualifying periods prescribed be
for outstanding category. However, the outstanding ratings of these executives
shall be reviewed in detail before such consideration by the respective
performance review committees

45
Counseling Low Performers: The low performers who fail to fulfill the prescribed
eligibility norms for 3 successive years shall he counseled by the Committee. This is in
addition to the counseling done by their respective Reporting Officers as laid-down in the
Appraisal System. The Committee(s) may also recommend developmental training
and/or change of job to enable such low performers to improve their performance.

Dates of promotion: Promotions shall be processed once a year in the month of

May/June The qualifying period shall be reckoned as First of July in the current year.
Subject to fulfillment of other promotion norms, promotion orders shall be released
effective from 1stJuly only. Promotions with retrospective effect are totally discouraged.
Exceptions should have prior approval of the Director, Personnel.

Vigilance Cases: The Vigilance cases shall be dealt with under the 'Sealed Cover
Procedure' prescribed by the Bureau of Public Enterprises.

Interview:An interview shall he conducted in all cases of promotion by the Departmental

Promotion Committee or the Selection Committee, as the case may be.

Channels of Promotion

For considering promotions in the same or similar disciplines in the Unit Cadre, a
Division may be taken as unitary channel of promotion wherever this is practicable.
Otherwise, the unit could be taken as a chan nel of promotion. •

Departmental Promotion Committees:DPCs will be constituted for considering Promotions.

Following will constitute DPC for:

I) Supervisory Group

i) Head of the Works or Division,

ii) Representative of Finance Department,
iii) Representative of Personnel Department,
iv) Concerned Head of the Department/Sectional Head,
v) Representative of SC/ST.
Note: The Committee should invariably be headed by JGM/DGM and the members of the Committee
should be atleast 2 levels above the level of the candidates.
2) Executive Group
Unit Chief,
Chief of Finance,
Chief of Personnel,
Chief of Works,
Representative of SC/ST.

46
Selection Committee for Inter Group

I) Unit Cadre

i) Unit Chief,
ii) Chief of Finance,
iii) Chief of Personnel,
iv) Chief of Works/Division,
v) Representative of SC/ST.
2) Corporate Cadre

i) CMD or his Nominee,

ii) Director/ED concerned,
iii) Unit Chief,
iv) Representative of Personnel Directorate,
v) Representative of Finance Directorate,
vi) Representative of SC/ST.

47
 MODULE 4

Performance Consulting
Concept of Performance Consulting
Perform &rice consulting is a flow of steps with an entry and an exit. It is a systematic
and data-driven process that helps consultants and business managers make sound
decisions about people and their performance in the organization.

Performance consulting is a process in which a trainer (either internal or external to

the organization) and the organizational client work together to decide how to improve
organizational and individual results. That may or may not include training. Performance
consulting takes a broad approach by:

1) Focusing on identifying and addressing root causes of performance problems;

2) Recognizing that the interaction of individual and organizational factors influences
employee performance;
3) Documenting the actions and accomplishments of high performers and comparing
them with actions of more typical performers.
Regardless of whether the trainer is an internal employee or an outside consultant, a
performance consulting approach recognizes that training alone cannot automatically
solve every employer performance problem. Instead, training is one piece of a larger
"bundled solution". For example, some employee performance issues might be
resolved by creating a training program for employees, and others might call for
compensation or job design changes.

According to Jim and Dana Robinson, "Performance consulting is a process in which a

client and consultant partner to accomplish the strategic outcome of optimizing workplace
performance in support of business goals".

Need of Performance Consulting

Performance Consulting is needed for the following reasons:

1) Organizational assessment,
2) Change management,

48
 3) Performance improvement,
4) Process improvement,
5) Performance measurement,
6) Strategy implementation.
Performance consulting provides middle and upper management with the tools and
techniques they need to improve company and human perfortnance. Performance
consultants have the skills to lead company assessment, change management, performance
improvement, process improvement, re-engineering, and performance measurement projects.

Performance Consulting Process

The purpose of this eight step process is to turn a reactive situation into a proactive
partnership to achieve a performance improvement result. Here is the eight-step process:

1) Contact: Assess the initial contact for assistance by asking yourself these three
questions:

i) Who Contacted you? Where does this person report in the organization?
What level of authority does this person have? What is this person's relationsnip to
you? Is he or she a peer, your supervisor, or merely a messenger? Ele aware that
this contact person might not be the client. A client is one who has both a need to
be involved in the project and the authority to make critical project decisions.
i i ) What did this Person Ask for? Were you asked to investigate or fix a problem, put on
a training event? Was the contact posed as a request, or was the person merely
complaining about a troublesome situation? Based on the request, which role(s)
might be appropriate for this situation? It is critical at this point to
understand the request and initially determine your appropriate role. if the
training manager is only comfortable with the traditional training approach,
then every problem may be seen as a training problem.

2)Explore: Begin to look at the issue by asking several questions. Listen for
facts and feelings as the issue is described. Use this fact-finding step to discover as
many dimensions about the issue as you can.

Validate the assumptions made by your contact. Determine whether this is a training
problem or not. Determine whether this contact is the true "client" and decision -
maker or only a messenger. Identify what performance consulting roles) may he
appropriate for you. Identify how this request is related to a business need and sort out
what is truly needed
versus what is wanted. Determine at what point you are being asked to jump in.

3) Contract: Agree with the client on the outcome or results desired or objective to
be achieved. Note that at this point you have not agreed on a solution or event. Gain

49
agreement on the next step and mutually, decide the boundaries of the needs assessment that
will develop enough information to create a performance improvement plan. Decide when
you will present your plan.

4)Diagnose: Conduct a needs assessment using a performance analysis methodology

and other assessment tools as appropriate. This is the time to validate hypotheses made
during the Exploration step. Quantify as much factual information as you can.
5)Plan: Develop a performance improvement plan that contains these elements:
i) Defines the performance issue(s) and how it is related to a business need,
ii) Re-affirms the outcome, results, or objectives of the plan,
iii) Clearly states the performance deficiency and its causes,
iv) Identifies (or develops through a benchmarking process) performance standards,
v) Identifies the target population involved in the intervention,
vi) Establishes criteria for four levels of evaluation,
vii) Describes the intervention,
viii) Estimates the cost of the plan,
ix) Builds a partnership with management,
x) Creates a schedule for the intervention.

6)Act: Carry-out the intervention according to the agreed schedule. This can include a
variety of activities that may or may not include training. There can he multiple bias-free
solutions and may include: Establishing or clarifying a policy, Setting-up a process or
procedure, Creating a job aid, Distributing information in a written or brief presentation,
Conducting a demonstration, Conducting a training program, Setting individual action plans.

7) Evaluate: Ask for the reaction of the new analysts who attend orientation and
case management training. Conduct a test to identify what the new analysts have
learned. Check the log to identify whether the analysts have changed their behavior
and are using the log and case management techniques appropriately. Check for
bottom-line results by monitoring the forty-eight hour resolution standard and user
satisfaction/complaints

8) Integrate: By providing a job aid for the case management process and revised
case management training, the IS department can function independently
following your assistance.

Using this eight-step performance consulting process allows the organization to save
time, money, and employee satisfaction because inappropriate training (time
management) was not conducted. A real solution is possible because the problem was
diagnosed correctly and ways to measure the intervention provides concrete results.

Role of the Performance Consulting

50
 Performance consulting teaches training and HR professionals how they can become
performance consultants. In addition to providing FIR and learning solutions, these
consultants also address the performance needs of employees and:

I) Assist management in identifying the performance required to achieve business

goals;

2) Determine the degree to which the work environment of employees will support
and encourage the performance required; and
3) Determine the impact of the work done to support performance change, In the
process, performance consultants become valued partners to management,
assisting in identifying business goals and objectives and taking all actions needed
for employees to support them successfully.
Effective performance consulting and training can provide big pay-offs for the employer in
increased staff productivity, knowledge, loyalty, and contribution. These resources
increase your ability to do performance consulting, measure performance improvement,
and provide resultant training using internal staff. Increase your self-sufficiency in
performance consulting and improvement.
A. skilled group of in-house consultants can help your organization achieve these
benefits:
1) Performance results will be improved through the joint efforts of consultants
and line business units.
2) Development resources will be focused on priority areas, which enhances business
results and support business strategies.
3) Business units will be presented with options that combine performance improvement
expertise with business realities.
4) Consultants will choose from a number of performance improvement strategies,
including training, to help clients to solve problems, meet needs, and grasp
opportunities. More opportunities for performance improvement will be discovered.
5) Trainees are more motivated to learn and use new skills as a result of "just in time"
training addressing immediate needs. Pay-off from the investment in training will be
more immediate.
6) Human resource development staff will have increased credibility in the organization as
a result of their increased knowledge of each Unit's business strategies.

Training to Performance Consulting:

Strategic Plans for Moving from Training to Performance
Following steps, when followed, result in a strong plan:
1) Identify the current and future desired state for the function;
2) Form the framework for the function's purpose:
i) Mission statement,

51
 ii) Vision statement,
iii)Guiding principles for the function, and
iv) Clients and customers for the function.
3) Define the business context in which the function will operate:

i) Identify business goals and initiatives for the organization in the next three to five
years;
ii) Conduct environmental scan of forces within and outside the organization
that will either encourage or challenge the department's plans and fulfillment of its
mission.
4) Form strategic (three-year) goals:

i) Goals in support of client requirements, and

ii) Goals regarding the department itself.
5) Form tactical (one-year) goals:

i) Goals in support of client requirements, and

ii) Goals regarding the department itself.
6) Farm an implementation plan with milestones.

A strategic plan identifies the hopes and visions for the function and integrates them
into the business requirements of the organization. In this manner a "win -win" plan is
formulated.

Performance Relationship Maps:

We know that we can best influence management when we can illustrate how actions
being proposed will have a positive effect on the business. To do this we must be able to
illustrate the interrelationship between business goals, performance requirements,
training, and °work environment needs. What performance is needed if the business
goals arc to be realized? What is the current capability of individuals to demonstrate this
required performance? And what training and work environment actions will be
needed to change performance? These are the types of questions we need to
address with management.

A specific business need is written at the top of the rnap ( e.&., 'Increase reliability"
or "improve profits"). The map then indicates that information is required under box I
(Should operational results). Far this box the specific business goals regarding the
business need will be noted, e.g., How much waste is acceptable? How much profit is
desired?

The map requires information regarding the type of perforra2nc-e that people should
demonstrate if the desired operational results are to be realized. If the organization wants

52
to increase profits, what must people do to make that happen? If product reliability is to be
increased, how will people liaye to perform?

we identify the current performance (or the is) of people as compared to the
desired performance, or should, as noted in box 2. What kinds of gaps exist? Of course,
it is this performance that yields the currant operational results, or is, in box 4.

we identify the various factors and forces that impact upon the desired performance.

External causes are factors that are outside the control of a client team yet affect the
achievement of operational results and performance requirements. For example, if
the economy is in a recession, it imp acts upon an organization's ability to
achieve its revenue and profitability goals. Also, corporate headquarters can make a
policy decision that affects the performance of a plant; for a plant manager, this would be
an external factor.

Internal causes are factors that are within the control of a client team and that impact
upon achievement of operational and performance goals. If employees lack the skill and
knowledge to do what is required of them on-the-job, this will be a reason for their non-
performance. This cause can be addressed through training and development. lf,
however, employees lack any incentive or reward to do what is being asked of them,
this will also be a reason for their nonperformance. However, it cannot be addressed
through training actions; a client team will need to re-design the incentive system.

Designing and Using Performance Relationship Maps:

Performance consultants are continually seeking information. This can be done both
formally through performance assessments and informally over lunch with a manager. But
information must be obtained within the framework of a plan. Performance consultants
need to know where they are headed as they ask questions, targeting each question
like a laser beam to help to clarify the situation.

The plan used by performance consultants should be based upon a model or conceptual
framework which is the performance relationship map. This map is something that has been
developed and used over the past six years; it serves three purposes:

1) Provides Guidance to the Data Gatherer: It provides the data gatherer

(performance consultant) with guidance in determining what information is important to
obtain and what information may be unnecessary.
2) Alerts: It alerts us when we are missing data in one area – e.g., information about what
successful performers do.
3) Vehicle for Displaying Information: It acts as a vehicle for displaying

53
 information to management. The map specifically illustrates the
interrelationship between business, performance, training, and work environment
needs. This is critical because managers are most likely to support actions when they
understand that these actions will affect the achievement of business goals in a positive
manner.
We have been ash, the map for the past six years; we know it works. It has been
adopted by several hundred individuals with whom we have had the opportunity to
work.

Performance Consulting Services

1) Executive Coaching: Coaching helps individual in enhancing their skills, overcoming

performance blocks, and maximizing their performance. Areas of coaching expertise
include the following:

i) Oral presentation,
ii) Written presentation,
iii)Leadership and supervision,
iv)Facilitation,
v)Interpersonal skills, and
vi)Myers-Briggs analysis.
2) Team Development: Team development services to help organizations to create and
sustain high performing work teams. We work at varying levels of development. These
are:

i) New Teams: These teams need to define their mission, goals, and operating
guidelines.
ii) Struggling Teams: These teams need to work-out their difference constructively to
re-build team relationships and re-focus on their mission.
Est:delished Teams: These tears need to continually renew and re -energize to
iii)
remain motivated and productive.
3) Meeting Facilitation: It is both an art and a science. Three critical and
interdependent areas to make your meetings more efficient, effective, and interesting are as
follows:

i) Meeting Purpose: Define a clear purpose which includes meeting issue,

deliverables, and a compelling rationale to secure buy-in and appropriate participation.

ii) Participants and Stakeholders: Determine whose input is needed to best serve the
meeting's purpose, and how to manage attendees' comfort zones to get

54
 maximum appropriate . participation. A lso., understand and define the roles of
facilitator, recorder, leader, and facilitative participant.
iii) Process: Balancing task and relationship, define the most effective process
techniques and tools to achieve the meeting's purpose and deliver its outcomes.
iv) Management Skills Training: Learning is accomplished through presentation,
discussion, demonstration, and small and large group activities and simulations.

Contracting For Performance Consulting Services:

Organizations use consultants for these reasons:

1) To provide expertise for a special project.

2) To augment the workforce when the load is greater than the existing staff
can handle.
3)To provide an outside and unbiased opinion on a controversial topic.
4)To assume responsibility for a particular phase of operations (otherwise known as
outsourcing).
Before hiring a consultant one should examine the objectives, because they affect the choice of
consultant. Some consultants specialize in a narrow field.
Some confine their operations to a particular geographical area. There are multi-
consultant firms and sole operators. The objective in selecting a consultant is to
match his or her capabilities as closely as possible to your needs. Ask yourself these
questions – why, when, and where do I need a consultant; what do I want the consultant to
do; and what should the outcome be? Note that these are the same as the five
questions reporters ask – what, where, when, why, and how – except for the how, which
should be left to the consultant. You should not have to specify how; if the consultant is
truly an expert, he or she will know that better than you.
Organizing Performance Improvement Department:
The focus will be shifted from the individual to the entire department. How must the department (typically referred
to as the training department or HRD department) be structured if it is to truly encourage and support the role of
Performance Consultant? What accountabilities and reward systems need to be formed? What roles and skill sets
will be required of those who are in the department?
Key elements of a performance improvement department have been identified noting how they are different from
those of a more traditional training department.
One company's training department operates on a charge-back system, meaning that internal customers must pay for
the services they receive from the department. Unfortunately, the only service with a fee is delivery of a training
program. No fees are incurred for completing the performance consulting services, such as developing performance
models, identifying performance gaps and causes, and measuring the performance and operational results from an
intervention. This system encourages delivery of training (which yields fees) and not provision of performance
services.

Another organization has the expectation that people of similar titles or levels will work
directly with peers; however, trainers often are at a "lower" level in the organization than
the clients they are to support. They-- therefore are precluded from direct access to their
clients.

55
The performance measures for a member of the training department in another organization are
based upon the number of training programs conducted and favorable ratings on the
reaction evaluation forms. There are no measures for the quality of the client-consultant
relationship or the contribution to performance and operational impact.

Use the name training department to refer to functions formed to address the traditional
roles of training and development; . use the term performance improvement department
to refer to the type of function believed is required in the 1990s and beyond.

Six components of organizational structure separate a tr aditional training department

from a performance improvement department. These are: 1) The name of the department

2) The mission of the department,

3) The services offered by the department,
4) The roles of those within the department,
5) The actual organizational structure of the department.,
6) Accountability and measures for the department.

56
 Module 5
Competency Method in HRM

Meaning and Definition of Competency

Competency is a fairly deep and enduring part of a person's personality and can predict
behavior in a wide variety of situations and job tasks. A competency is something that
describes how a job might be done, excellently; a competence only describes what has to
be done, not how. A competency is a combination of tacit and explicit knowledge,
behavior, and skills that give somebody the potential for effectiveness in task performance.

A competency can be defined as a specific, identifiable, definable, and measurable

knowledge, skill, ability, and/or other deployment -related characteristic (e.g.,
attitude, behavior, physical ability) which a human resource may possess and which is
necessary for, or material to, the performance of an activity within a specific business
context".

Characteristics Of Competency
There are five types of competency characteristics – motives, traits, self-concept,
knowledge, and skills. Of these, motives, traits, and self-concept are invisible whereas
knowledge and skills are visible. These are described hereunder:
1) Motives: Things a person constantly thinks about or wants, which result in actions.
2) Traits: Physical characteristics and consistent responses to situations or information.
3) Self-Concept: A person's attitudes, values, or self-image.
4) Knowledge: Information that a person has in specific content areas.
5) Skills: The ability to perform a certain mental or physical task.

Types of Competency
The three types of competencies are:
1) Universal: These competencies emphasize that all the employees of an
organization must reflect the company's values, culture, and business imperatives,
e.g., customer focus, teamwork, communication skills, and cost-effective service delivery.
2) Transferable: These competencies include skills and abilities needed to perform
several roles in varying degrees of importance and mastery, e.g., leadership and
managerial skills.
3) Unique: These competencies refer to specialized know-how or abilities required
within a specific role or job.

57
 Competence Versus Competency:

Competence Competency
Means the ability to perform a job. Means behavioral competencies.
Skill and standard of performance The behavior by which the
reached. Competence has been achieved.
Skill based. Behavior based.
Standard attained. Manner of behavior.
What is measurable? I low the standard is achieved.
Result of Intelligence Quotient. Result of I motional Quotient.
It is about the knowledge required to It is about the underlying feelings, emotions,
perform a job effectively. & behavior to perform a job effectively

Features Of Competency Methods

Competency mapping methods are:
1) Assessment centers
2) Critical incident method
3) Interview techniques
4) Questionnaires

1) Assessment Centers
Organizations are using assessment centers for mapping competencies.
An assessment center is a comprehensive, standardized procedure in which multiple
assessment techniques are used to evaluate individual employees for a variety of decisions.
Assessment center technique is a process that allows participants to demonstrate
behaviors specifically related to a job role. It engages participants in structured exercise
designed to elicit specific behaviors, utilize activities that reflect "real life" situations by
simulating individual, group, and one-to-one tasks and involves trained assessors to
observe and evaluate performance.

An assessment center for performance appraisal of an employee typically includes the

following:
1) Social/Informal Events: An assessment center has a group of participants and also a
few assessors which gives a chance to the employees to socialize with a variety of
people and also to share information and know more about the organization.
2 ) Information Sessions: Information sessions are also a part of the assessment
centers. They provide information to the employees about the organization, their roles
and responsibilities, the activities and the procedures, etc.

58
3 ) Assignments:Assignments in assessment centers include various tests and exercises
which are specially designed to assess the competencies and the potential of the
employees. These include various interviews, psychometric tests, management games, etc.; all
these assignments are focused at the target job.It is mainly used for executive hiring,
assessment centers are now being used for evaluating executive or supervisory
potential. An assessment centre is a central location where managers may come
together to have their participation in job-related exercises evaluated by trained
observers. The principal idea is to evaluate managers over a period of time, say one to
three days, by observing (and later evaluating) their behavior across a series of
selected exercises or work samples. Assesses are requested to participate in in-
basket exercises, work groups(without leaders), computer simulations, role playing.
and other similar activities which require the same attributes for successful
performance, as in the actual job. After recording their observations of rate
behaviors, the raters meet to discuss these observations. The de cision regarding
the performance of each assesses is based upon this discussion of observations.

Uses of Assessment Center

1) Selection: ACs help organizations in getting the right people in.

2) Career Development: The identification of the competencies possessed by the

individual helps organization to decide his career plans.
3) Potential Appraisal: ACs help organizations to identify if the pL.son can handle the
challenges offered in the next higher position.
4) Identification of High Potential Managers: This creates a pool of managerial
talents and multi-functional managers that would be available Across the business
group, etc.
5) Succession Planning: Identifying the right individual for critical positions such as
CEO, CFO, etc., is very important for the success of the organization. ACs
reduces the risk of such wrong identification.
6) Allocations of Challenging Assignments: ACs provide the organization with the
strengths and weaknesses of every participant. This helps the organization in
deciding the candidates who would have the necessary abilities to undertake the
proposed challenging assignments.
7) Management Development: ACs provide ample opportunity to its participants to
reflect on one's capabilities and to improve by observing others performance in the
AC.
8) Identification of Training Needs: Assessment centers provide candidates and
organization with concrete data on the improvement areas, which can be utilized, for
training.
9) Identification of a Global Pool of Talented Managers: Adjusting oneself in the global
scenario is a critical requirement of some positions in the organization. ACs help
organizations to identify such managers.

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 2) Critical Incident Technique
Flanagan developed the critical incidents technique. In the literal sense, critical means
serious, vital, crucial, derogatory, and precarious. But in an organizational
context it is difficult to define critical incidents. Nevertheless, we can definitely opine that
critical incidents can contribute to the growth or decay of an organizational system, of the
organization as a whole. The critical incidents technique uses a set of procedures to
systematically identify behaviors that contribute to the success or failure of individuals or
the organizations in specific situations. This technique requires observers who are
frequently doing the job, such as supervisors, clients, peers, or subordinates.
Observers are interrogated to describe the incidents of effective and ineffective behavior
of a person over a long period of time. Organizations initially prepare an exhaustive list of
good or bad job behavior. The help of a panel of experts is sought to rate how good or
how bad the behaviors are. Next, the organization prepares a checklist of the good or
bad behavior.
There are certain criteria for the successful use of the critical incidents technique.
Some of these are:
1) Data are collected on direct observations of real critical incidents that occurred
while accomplishing a task in a real-life situation.
2) The actual jobholders perform tasks.
3) Data is gathered in the real-work environment.
4) Users are located in a real-work environment.
5) Users are required to report the critical incidents after they have occurred.
6) Direct interaction between the users and the evaluators does not take place.
7) Qualitative data can be gathered by the users at a very low cost.

Steps of Critical Incidents Technique

There are three steps involved in this technique, namely:
Step 1: Gathering Facts: Retrospective data are captured through an open-minded
questionnaire. Much gap is not allowed between the happening of the events and
capturing the data. In case of a longer time period, it becomes difficult to gather the
true responses as imagined stereotyped responses replace the true responses.

For gathering facts, generally two approaches are adopted — unstructured approach
and moderate structured approach. In the unstructured approach, individuals are
asked to submit two good things and two bad things while performing a given task or
set of activities. In the moderate structured approach, the individuals are requested to
respond to certain questions on the happenings relating to the activity he/she was
performing. The questions may be of the type:
1) What exactly had happened?

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 2) What might be the reason behind the happenings?
3) How did the happenings affect the outcome or result?

Step 2: Content Analysis: This step facilitates identification of incidents capable of

representing content dimensions or categories. Recording of incidents is an ongoing
process. Several incidents are recorded and submitted to the analysts, who study the
cluster of incidents and categorize and sort the incidents into content dimensions. This
process is just grouping the incidents based on the dimensions. The sorted incidents
resemble the affinity diagram of total quality management. The basis of grouping is 'identical',
'quite similar', or 'could be similar'. Each category is assigned a name and the number of
incidents are counted and recorded. The number of incidents in a category is expressed as a
percentage of the total number of incidents. The categories are often arranged in descending
order of the percentage counts. Then the report is compiled.

Step 3: Creating Feedback: Everybody has strengths and weaknesses that often
remain unidentified. In specific organizational situations, the person's strength
becomes useful. The supervisors in the HRD system bear the responsibility of
observing, identifying, and providing feedback to the junior colleagues about their
strengths and weaknesses. Added to this, they should have guidance to improve
enabling capacities and performance capabilities. It is important to provide both positive
and negative feedback.

3 Questionnaires
Interview technique as a method of competency mapping is unique, as a direct interaction
takes place between the interviewer and interviewee. The interviewer can observe
the body language of the interviewee from which he/she can record his/her readings.
An interview is the most commonly used personal contact method and many
organizations use this technique for competency mapping, they are as follows:

Certain steps must be observed for successful mapping:

Step 1: Preparation of a checklist of questions to identify the judging ability and skills.
The questions are to be framed based on the critical areas. The responses may be rated
on five-point or ten-point rating scales.
Step 2: The responsible person scrutinizes the information provided to identify the skills,
incidents, and experiences in the career of the candidate. He/she gets the answers to the
questions raised on critical areas. This procedure ensures that the interview is 'to the
point' without being removed from reality. The interviewee feels comfortable because
it is focused on his/her experiences.
Step 3: The interviewer must use tact and sensitivity to create a sense of ease and
informality so that the interviewees can get rid of tension, nervousness, and be at ease. If
tensed and afraid, they will lose creativity and originality. The interviewers should
create an environment where the interviewees are relaxed and open. They should also
honor the interviewee's motivation, attitude, feelings, temperament, etc.

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Step 4: The interviewer must cautiously build rapport with the interviewee. This can be
done if the interview process starts in a chatting fashion. The focus is on the interviewee's
fields of interest and the initial questions are framed on this. Otherwise, one may chat
on the weather, tourism, sports and games, and similar subjects.
Step 5: After creating an environment conducive to fruitful interaction, the interviewer
may start asking questions from the critical areas. Asking difficult and complex questions
at the beginning should be avoided. Gradually, confidence will build up and the
interviewee may then be able to answer complex questions. Thus, the pattern should be
from simple to complex questions.
Step 6: Disapproval or disagreement of answers inhibits the interviewee from responding
spontaneously. The interviewer must try to examine the viewpoint of the interviewee.
However, disagreement can definitely be expressed tactfully.
Step 7: The interviewer must avoid leading questions as the interviewee may feel that a
certain stereotyped response is expected. At the same time, the interviewer is alerted
that he/she must not allow the interview to get out of hand. He/she should check the
interviewee if the interviewee tries to lead the discussion in areas in which he/she has
mastery and feels himself/herself competent.
Step 8: The interviewer should prepare a checklist of questions, or else must study
carefully the questions or statements of the checklist prepared by others. He/she should
not take much time to prepare the questions, yet the checklist should be perfect.

Historical Development
The competency approach to human resources management is not new. The early
Romans practiced a form of competency profiling in attempts to detail the attributes of a
"good Roman soldier". The introduction of competency-based approaches was realized
around 1970, and their development since then has been rapid. The distinguished
Harvard psychologist David McClelland is credited with introducing the idea of
"competency" into the human resource literature, in his efforts to assist the United
States Information Agency in improving its selection procedures. The latter argued
that traditional intelligence tests, as well as proxies such as scholastic grades, failed to
predict job performance. McClelland's counterargument to the growing dissatisfaction with
intelligence testing and the traditional job analytic approaches to personnel selection was the
proposal to test for competency. As a case study, he proposed the selection of foreign
service information officers. In the research, it was found that competencies such as
interpersonal sensitivity, cross-cultural positive regards, and management skills
differentiated superior from average information officers.

Throughout the years, competency-based approaches have proven a critical tool in many
organizational functions such as workforce and succession planning, performance appraisal,
etc.
The main reasons for selecting these approaches are as follows:

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1) They can provide identification of the skills, knowledge, behaviors, and capabilities
needed to meet current and future personnel selection needs, in alignment with the
differentiations in strategies and organizational priorities.
2) They can focus the individual and group development plans to eliminate the gap
between the competencies requested by a project, job role, or enterprise strategy
and those available.

Approaches to Mapping
There are eleven approaches to competency analysis, and these approaches are also used as
tools to identify competencies. These approaches or tools are as follows:
1) Expert Opinion: The simplest method is for 'experts' (members of the personnel
department and representatives of line management) to get together and draw data
list from their own understanding of 'what counts', possibly by reference to other
published lists. This will certainly save time and trouble, but it may not be particularly
analytical and reliance on other people's ideas could result in a list being drawn up
which is irrelevant to the real needs and requirements of the business. When defining
generic or individual, role competencies it is essential to ensure that they flow directly
from the core competencies of the business so that people competencies are fully
integrated with and support business competencies.

2) Workshops: A more structured approach through a workshop is likely to produce

better results, particularly if the workshop is mainly comprised of people who are
actually doing the job. The competence definitions will then be expressed in the
language of the job-holders and are likely to be much more acceptable as well as
realistic.
The workshop facilitator's roles are to help the group to analyze its findings, to
prompt, to provide examples and to assist generally in the production of a set of
competence dimensions which can be illustrated by behavior-based examples. The
facilitator may have some ideas about the sort of headings that may emerge from this
process but should not try to influence the group to come to a conclusion which it has
not worked out for itself, albeit with some guidance.
3) Questionnaire Method: The most popular and widely used technique in assessing
competencies is questionnaire method. This method helps in all the three levels of
competency assessment: organization, function and job. A few relevant variables need to
be identified and developed. For example, competency variables for the job of human
resource manager can be:
i) Knowledge of human resource management theoretical aspects,
ii) Knowledge of best human resource management practices,
iii) Knowledge of organization's human resource policies and procedures,
iv) Knowledge about organization, it's business strategy and plans, operations,
financials competitors, various stakeholders,

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 v) Ability to use tools and techniques in human resource functions like recruitment,
performance appraisal, training and career planning systems,
vi) Interpersonal relationship skills,
vii) Communication skills,
viii) Conflict management skills,
ix) Change management skills, and
x) Commitment to the organization.
These variables must be operationalized into measurable statements. These statements can
be open-ended or in shape of checklist or with multiple choices or in a form of scale like
strongly agree to strongly disagree.

Similarly, this questionnaire method can be used for assessing competency profile at all
levels.
4) Interview Method: Interviewing job incumbents to elicit what competencies are
required to perform a job effectively reveals valuable information that helps in identifying
the most relevant competencies of a job. Resource persons who are trained on interview
method use both a standardized and contingency format to collect information. Format
contains combination of structured and open-ended questions. Taking into account the
scope of study, either all or representative sample of employees will he subjected to
these interviews. Likewise, interviewing head of department, chief executive can reveal
function and organizational level competencies.
5) Observation Method: Resource persons observe the top and average performers while
working and taking decisions, interacting with people, leading co-employees, learning new
aspects and applying them. Typically, the first part of such report contains record of
observations and the second part observer's own interpretation and analysis of this
record. This observation of extreme performers in action facilitates identification of the
competencies required to carry out a task or job in the most efficient manner and also,
what inadequacy in competencies result in average performance. However, effectiveness of
this method depends upon the objectivity and neutrality of observers.
6) Story Writing Method: In this method, employees and their superiors will be asked to write
in descriptive fashion, tasks they perform and knowledge, skills and behavioral characteristics
required performing such tasks with quality, precision and results. Writings from all
employees and superiors will be collected and analyzed to assess competency
requirements of various jobs and functions at the organizational level.
7) Critical Incident Technique: Major incidents either resulted in remarkable results or
failures to organizations and individuals if studied can provide wealth of information on
competencies required to handle such incidents. In this method, a few incidents happened in
the past or situations likely to arise at present or future will be chosen for a special study.
Both observers and incumbents of the jobs will write a descriptive version on the origin of
incident. how this has been tackled, why a particular approach is used over others, what
knowledge, skill or soft skills are used in resolving such an incident and what results are
expected and actually what is achieved. Data collected using this method particularly

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 helps in identifying critical competencies.
8) Repertory Grid: This method is somewhat similar to critical incident technique. Repertory
grid is used to identify dimensions of good and poor standards of performance. These
dimensions are developed through interviewing and surveying jobholders to explore what
behaviors make some to perform exceedingly well while others give poor performance.

9) 360-degree Survey: Collecting views as well as perceptions of all stakeholders

regarding what competencies are desirable and essential to lead an organization, manage
departments and perform various jobs in an organization effectively, yields a lot of
information. This data involving all stakeholders on all competency levels can be
collected using questionnaires, essay writings, debates and conferences.
10) Focus Groups: In this method, employees:
i) Who are performing exceedingly well, and
ii) Whose innovation rate is far superior and who have the record of breaking
status quo will be formed as a focus group. This group will work on identifying and
suggesting the ideal competency model to put into practice
at organizational, functional and job level for magnificent results.
11) Case Study Method: Highly successful performances which employees cherish and regard
the best in their career in an organization and events of under performances must be
studied in depth in order to understand circumstances in which performance goes to
peak and conditions that cause below average performance. Skills required to successfully
manage adverse conditions and skills required to create conducive conditions of superior
performances can be identified. The case study method is used where a detailed study is
required. Resource persons conduct the study with the help of a structured and
unstructured information seeking formats.

Methods of Competency Mapping

Competency mapping is necessary at an individual and organizational level. At the
individual level, competency mapping spells-out the performance level required to be
exhibited by an individual in order to achieve job goals and objectives successfully,
whereas it is the basis of performance management system for achieving organization
wide success in human performance. Therefore, competency mapping holds the key
to success of performance management in any organization. There are various methods
for competency mapping as explained below:
1) Past Performance-Based Method: This approach uses Behavioral Event Interview
(BEI). It is an adaptation of critical incident interview. This method uses Thematic
Apperception Test (TAT) in probing data about individual personality and cognitive
styles of thinking, feeling, etc. This is an interview technique based on the premise
that the best predictor of future behavior is past behavior. Steps followed in this method
are:
i) Identifying the position to be mapped.

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 ii) Identifying outstanding performers, and below average, or average performers.
iii) Interviewing them by using BEI.
iv) Generating the list of competencies needed (from outstanding performers)
and not needed (from below average or average performers).

2) Job-Focused Method: Job-focused approach/method has the task, role, or

job profile of the incumbent as the central point. The starting point of this
method makes use of position information questionnaire, which gathers
information on the incumbent's position. This method includes:
i) Understanding the purpose of the job.
•
ii) Asking incumbents to list down the job's major activities and
accountabilities.
iii) Mapping each accountability or major task.
3) Value-Based Method: This method uses normative, cultural, and traditional
values of the organization to construct competencies. It ranges from a very careful
and structured dialogue process involving top leadership, to simple
pronouncements made by the CEO or HR Head on the competency list generated by HR
group.

Model for Competency Mapping

There are three models in mapping the competencies described as follows:
1) One-Size-Fits-All Competency Model: This model uses the data obtained from existing
job descriptions and job analysis. The data pertaining to a class of jobs, e.g. civil
structural engineers/sales representatives will be consolidated and key features
will be identified to convert them into competency traits. The general features like
organizational mission, objectives and culture related competence would be added to
build a competency model for a civil structural engineer/sales representative likewise.
2) Multiple Job Competency Model: There are three steps in this. In the first step,
competencies required for organizational function will be identified. Secondly,
these competencies will be classified into technical, social, marketing, management,
finance and general. In the third step, combination of competencies will be grouped to
draw a particular role like finance manager, technical manager, quality manager likewise.
3) Single Job Competency Model: This is a traditional, time tested and commonly
used method. A position that is most important and being performed well will be
identified from a class of positions (jobs). Data will be obtained observing its
incumbent while performing the job, discussing with him/her and other related
departments, past records, decisions taken by that person, formal job description,
etc. The data so obtained will be used to build competency model for that particular
position.

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 Module 6
Competency Mapping Procedures and Steps
Business Strategies: At the heart of any successful activity lies a competence or a
skill. In today's competitive world it is becoming particularly important to build on
the competitive activities of business. There has been much thinking about business strategy
over the last three decades, particularly regarding what competencies a business needs to
have in order to compete in a specific environment. Top management is identifying
corporate core competencies and working to establish them throughout the
organization. Human resource development builds competency-based models that drive
business results.

All organizations are talking about competencies. Some have truly worked the concept
into several of their processes. A few have a fully implemented competency
modeling and reporting system in place. These address the development of people
from process design through succession. However, quite a few organizations are still
striving to build a competency model and implement it. Most organizations of all sizes
are still struggling with defining, designing, and implementing competency model projects.

The process is completely customizable. The decisions of competency design are driven
by a number of organizational factors, including management philosophy, customer
requirements, business needs, and in-place processes. These factors vary from one
organization to another, requiring a customized approach to competencies in the
workplace. Customization is essential to the overall success of competency efforts, since
every organization must integrate competency concepts into its own job design, recruitment,
hiring orientation, development, and succession processes.

Performance Criteria:
Performance criteria basically define what an individual needs to accomplish in order to be
deemed competent based upon a specific competent statement.

Performance criteria are expectations for performance of a specific competency.

They define the performance behaviors that are necessary for an identified competency.
Performance criteria have been used in the past to define the required standards for a job
applicant. Similarly, performance criteria have been used to monitor and manage job
performance through appraisals, and training and development programs have been designed
and evaluated using performance criteria.

As Human Resources (HR) departments have become more integrated it makes sense to
have one common set of criteria to cover common themes in different people-management
processes. This would ensure that key criteria used to select an individual are also used

67
 to monitor and manage their performance and to focus their training and development.
Competencies are an efficient way of providing a common framework of performance
criteria for use across the full range of people-management processes.

Characteristics of Performance Criteria

1) Describe employee behavior,
2) Describe behavior that is observable and measurable,
3) Are limited to a single behavior,
4) Include sufficient description of the behavior,
5) Include desired conditions imposed on performance,
6) Include a performance standard,
7) Include essential aspects of performance.

Benefits of Performance Criteria

A common framework of performance criteria for all people -management processes
has two further benefits, as it provides:
I) A common language . across all parts of an organization for describing effectiveness
in that organization. For example, users of the framework will have a common
understanding of what good leadership looks like or what it means to be effective when
working in a team
2) An opportunity to achieve a high level of consistency when assessing
performance. Whether for selection or in appraisal, all 'assessors' will know what
good performance should look like and will know what needs to be assessed and what
can be ignored.

Criteria Sampling
Criteria Sampling or Sampling Criteria also referred to as eligibility criteria;
include a list of characteristics essential for membership or eligibility in the
target population. The criteria are developed from the research problem, the
purpose, review of literature, the conceptual and operational definitions of the
study variables, and the design. The sampling criteria determine the target population,
and the sample is selected from the accessible population within the target
population. When the study is complete, the findings are generalized from the
sample to the accessible population and then to the target population.

A researcher might identify very broad sampling criteria for a study, such as all adults over
18 years of age able to read and write English. These criteria ensure a large target
population of heterogeneous or diverse potential subjects. A heterogeneous sample
increases the ability of the researcher to generalize the findings to a larger target
population. In descriptive or correlational studies, the sampling criteria may be defined to
ensure a heterogeneous population with a broad range of values for the variables beiag

68
studied. The sampling criteria may be specific and designed to make the population as
homogeneous as possible or to control for extraneous variables. In quasi-experimental
or experimental studies, the primary purpose of sampling criteria is to limit the
effect of extraneous variables on the particular interaction between the dependent and
independent variables. Subjects are selected to maximize the effects of the
independent variable and minimize the effects of variation in other variables. The
number of restrictions that can be imposed by the sampling criteria depends on the
typical patient load in the selected setting.

Sampling criteria may include characteristics such as the ability to read, to write
responses on the data collection instruments or forms, and to comprehend and
communicate using the English language. Age limitations are often specified, such as
adults 18 years and older. Subjects may be limited to those who are not participating in
any other study. Persons who are able to participate fully in the procedure for obtaining
informed consent are often selected as subjects. If potential subjects have diminished
autonomy or are unable to give informed consent, consent must, be obtained from their
legal representative. Thus, persons who are legally or mentally incompetent,
terminally ill, or confined to an institution are more difficult to access as subjects.
Sampling criteria can become so restrictive that an adequate number of subjects cannot be
found.

A study might have inclusion or exclusion sampling criteria (or both). Inclusion sampling
criteria are those characteristics that a subject or element must possess to be part of the
target population. Exclusion sampling criteria are those characteristics that can cause a
person or element to be excluded from the target population.

Tools for Data Collection

Following are the tools of data collection for mapping are:
1) Observation method
2) Repertory grid
3) Critical incidence technique
4) Expert panels
5) Surveys
6) Automated expert systems
7) Job task analysis
8) Behavioral event interview.

Data Analysis
Data analysis is a practice in which raw data is ordered and organized so that useful
information can be extracted from it. The process of organizing and thinking about

69
data is key to understanding what the data does and does not contain. There are a
variety of ways in which people can approach data Analysis, and it is notoriously easy
to manipulate data during the analysis phase in push certain conclusions or agendas. For
this reason, it is important to pay mention when data analysis is presented, and to think
critically about the data and the conclusions which were drawn.

Analysis of data is a process of inspecting, cleaning, transforming, and nodding data

with the goal of highlighting useful information, suggesting conclusions, and supporting
decision-making. Data analysis has multiple facets and approaches, encompassing diverse
techniques under a variety of names, in different business, science, and social science
domains.

Data analysis in competency mapping contains the following steps:

I) Review List of Competencies

i) Review the competencies that are identified, to check if they fulfill the purpose or
objective of the job.
i i ) Competencies are finalized for each job role.
i i i) Identify and list meta competencies.
iv) Have it agreed with the management teams.
v) Each role profile in turn would now have a detailed set meta- and sub-competencies.
Each of the competencies are now defined in the context of the role profile.

2) Assign Proficiency Level

i) Define what proficiency means to the organization and what use would it be
put to within the organization.
ii) Define levels and differentiate between appraisal ranking and proficiency
levels.
Validating The Competency Model
Validation can be done in three stages, which are as follows:
1) Content Validation Session
i ) Bring together an appropriate focus group consisting of top management,
cross-section managers, and typical role profile-holders. '
ii) Validate the skills identified and competencies profiled.
iii) Conduct a validation exercise to check for the ease of understanding implementation
possibility, time, and the process involved to roll it out through the enterprise.
iv) Define milestones for such an implementation work.
v) Tabulate the learning process.
vi) Evaluate whether the exercise has generated adequate information to
progress with the competency definition proficiency mapping exercise.

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 vii) Re-establish the business case for implementing a competency development
work process.
viii) Run pilot workshops wherever necessary.
2) Reinforce Proficiency of Critical Competencies
i) At this stage, proficiency analysis and validation is essential to be conducted
through similar cross-management focus groups.
ii) Illustrate with examples how proficiency levels have been articulated, valued, and
how they would be used.
iii) Handle insecurities and threat perceptions in the usage of proficiency levels.
iv) Run pilot workshops where necessary.
3) Refine Competency Definitions, if Necessary
i) Focus on the competency definitions obtained through the validation exercise.
ii) Conduct a top management workshop and finalize the definitions.

iii) Run a pilot focus group, if necessary.

Ways to Validate Competency Model
The competency model can be validated in three ways, which arc as follows:
I) The researcher can collect BEI data on a second criterion sample of superstar
and average performers. BEI stories from the second sample are then scored to see
if the competency model based on the first study predicts the superior and
average performers in the second sample. This approach is called "concurrent cross-
validation", meaning the competency model is tested by seeing if it predicts the
performance of people in a second group at a current point in time.
2) Tests can be developed to measure the competencies described by the
competency model and used to test people in a second criterion sample of superior
and average performers. Alternatively, managers and other knowledgeable
observers can be asked to rate and rank members of the second criterion sample on
competencies using rating forms or Q-sorts. If the competency model and the tests or
rating forms are valid, superstars in the second sample should get higher scores on
these tests and rating forms. I his is called "concurrent construct validation",
meaning-,different constructs or measures, the competency tests; are used to
predict performance of people at a certain point in time.
3) The third and most powerful way to validate a competency model is to select (using tests
or data from BEIs) or train people using the competencies and see if these people actually
perform better in the future. This is called "predictive validity" because the competency
model is expected to predict, how people will perform. This is what traditional
education, grades, test scores and credentials do not do–predict actual job

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 performance or success in life.

Clearly, predictive validity is the bottom line for selection or training. I mployers
hiring people want to use criteria that predict the people hired will (10 the job well.
Trainers want to teach skills that will enable people to do the lob well.

Short Competency Model Process Based on Expert Panels

Developing a Model

Step 1: Convene Expert Panels: For resources specialists, managers, and following:
1) Key Accountabilities: The most important duties, responsibilities, & product or
service outcomes.
2) Results Measures: The result measures for these accountabilities that can be Used to
identify superior performers in the job.
Ideal criteria are hard outcome measures such as productivity data. In the absence of
such criteria, supervisor, peer (if peers have an opportunity to observe one another's
performance), subordinate (e.g., organizational climate survey) and/or customer
ratings can be used. Even if a criterion sample is not identified, these data are useful for
designing performance management systems and in focusing the panel on the key
results outputs of the job when identifying characteristics that predict getting these
results.
3) Career Paths Optional: Career paths that typically lead to the job.
4) Competencies: The employees need toper form the job at:
i) A baseline or "threshold" level, and
ii) A superior level.
Expert panel members may also:
5)' Complete a Competency Requirements Questionnaire (CRQ), a survey that assesses
competencies required for threshold and superior performance in the job.
6) Respond as a group to questions posed by the computer-based "expert system".

Step 2: Conduct Behavioral Event Interviews (BEls) [Optional]: If possible, a few

superior incumbents are interviewed to confirm and provide narrative examples of
competencies identified by the expert panel. BEIs are most valuable in identifying the
nuances of how competencies are expressed in an organization's unique culture and
context. For example, a panel, survey, or expert system can identify "Uses Influence
Strategies" as a competency, but not how, when, or what an effective influence strategy looks
like in this particular organization. Even one BEI can provide the richness of detail to
make competencies identified "come alive" in sufficient detail to he useful for selection or
training applications.

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Step 3: Analyze Data and Develop a Competency Model: Data from the expert panels,
surveys, expert system, and BEIs are content analyzed to identify behaviors and personality
characteristics that:
I) Distinguish superior from average job incumbents, or
2) Are demonstrated by all incumbents adequately performing the job.

Step 4: Validate the Competency Model: A competency model can be quickly

validated by rating or ranking a criterion sample of superior and average performers on
the competencies identified in step 3 and confirming that superior performers are ranked
higher than averages on the competencies,

Outputs of a Short JCA

The outputs of a short JCA are one or more job description "competency models" that
include:

1) Purpose and Content of the Job/Job Family: Tasks, responsibilities, and performance
measures for the job rated as to level, frequency, and importance in a form that can be
used to compare the job's content with other jobs.
2) !Optional' Career Paths: Career paths for the job, with some estimate of when, where,
and how key competencies for the job are developed.
3) Competency Requirements: The skills and characteristics required for adequate and
superior performance in the job.

Mapping Future Jobs & Single Incumbent Jobs

Mapping future jobs means determining future work requirements. Forecasting
or planning for future work requirements is a fourth important component of an
effective SP&M program. After all, it is no more likely that work requirements will
remain static than it is that the organization itself will remain static. Organizational needs
change, and so do work requirements. It is therefore important to engage stakeholders
and decision-makers in planning for the changes that may be expected in the
organization and in its work requirements. That is essential if individuals are to be
prepared to meet future requirements. Even though few organizations regularly and
systematically forecast future work or competency requirements, the need to do
that is growing. It is simply not possible to prepare people if future work requirements
remain unknown.

Online and high-tech approaches have, however, provided new approaches to job forecasting,
scenario planning, and future-oriented competency modeling. Job forecasting estimates
future job requirements, addressing such questions as these:
1) What will be the future purpose of the job? How will that be different from the job's

present purpose?

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2) What are the expected work duties or responsibilities of the job in the future, and
how are they expected to change?
3) Summaries of individual skills (e.g., a personal skill inventory that details previous
work experience and language skills).

Special challenges are posed in determining the competency requirements for future
jobs and single incumbent jobs where there may be only one incumbent or the job being
defined does not yet exist. How can competencies for these
jobs be determined?

Approaches for Studying Future Jobs

Three approaches for studying future jobs (in inverse order of desirability) are
as follows:
1) Expert Panels "Guesstimates": An expert pane analysis of future jobs is similar to that
described for the short competency model process. Experts first list the
accountabilities, results measures and competencies of the mo st similar cu rr ent
j ob (s) in th e organiz ation, th en ident ify accountabilities and competencies likely
to be required by the future job(s). Experts can even construct critical incident
scenarios for future jobs by imagining typical situations a person in the future job might
face and then identifying competencies needed to deal with these situations effectively.
2) Extrapolation from Job Elements with Known Competency Correlates: Elements
or accountabilities for some future jobs may include competencies already identified
by previous competency research. Competency models for a future job can be
assembled from these elements. For example, a U.S. telecommunications firm
needed a model for senior marketing representatives capable of winning
European Government and community officials' approval for telecommunication
equipment to be sold in the European Common Market. With no overseas personnel or
experience, the firm had no superior or average performers to study.

An analysis of this future "technical ambassador" job indicated it will com bine elements
of diplomatic and high-tech sales jobs. Competency models already exist for both
diplomats and high-tech salespeople. From the diplomatic model, competencies
for the "technical ambassador" job included "cross-cultural interpersonal sensitivity",
"overseas adjustment" (adaptability, liking for novelty, resistance to stress caused by
living overseas), and "speed of learning (foreign) political networks" from the
diplomatic model; from the high-tech sales model competences include achievement
organization and consultative selling skills.

3) Analysis of Analogous Present Jobs: The best way to identify competency

requirements for future jobs is to:
i) Study superior performers in similar jobs now, then
ft) Use labor economics studies to extrapolate how many people will be employed in
these jobs, hence need the requisite competencies, at future points in time.

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Competencies for Single Incumbent Jobs
Competencies for single incumbent jobs can be determined by assembling data from key
people (dependencies) who interact with the person in the job.

A model was created for the Vice President of Human Resources of a certain hospital. This
position was empty; the incumbent had been fired. Competencies for this job were
identified by conducting BEIs with superiors (the hospitals' CEO and directors), peers (other
functional and operating vice presidents), key subordinates, and customers (union leaders
and prominent members of the community who dealt with human resource issues
with the hospital). Respondents were asked to identify critical incidents in which they
had seen previous VPs of human resources be particularly effective or ineffective. If they
could not think of incidents involving a previous job incumbent, respondents were asked
for incidents involving any health care VP of human resources.
It is not hard to identify competencies important to the CEO (or other
respondents) from these critical incidents – strategic thinking, concern for impact,
presentation skills, customer service orientation, quality concern, innovativeness,
political influence skills. Reasonably complete and accurate competency studies can be
prepared using the Short Competency Model Process and modified BEIs with key
dependencies of a job, even if its is single-incumbent job – and empty.

Using Competency Profiles In HR Decisions.

Meaning of Competency Profiling

Competency Profiling is a method utilized to identify the specific Knowledge, Skills,
Abilities, and Other Qualities (KSAOs) that are needed to complete and achieve particular
tasks and activities. Typically, these KSAOs are linked with specific behavioral indicators to
achieve the ultimate aim of fulfilling the needs of external clients and customers.
Competency profiling can be conducted through various job analysis methods such as
critical incidents technique and behavioral event interviews.

With well-designed competency profiling measures, an organization can ensure that its
objectives are fulfilled by providing clearly defined standards and methods for the
employees. The employees will also be provided with clear guidelines regarding what is
expected of them and provide them with the opportunity to address any potential
competency gaps so as to improve their individual performance. Having clearly defined
competencies is critical for activities such as recruitment, succession planning, and
organizational restructuring as it provides a map to the necessary knowledge, skills,
abilities, and other qualities that are necessary for the organization to fulfill its goals.

Competency profiling aims to identify all of these KAPS in order to help to create a real
and sustainable change in behavior:
I) Knowledge: Information that is organized, learned, and applied through experience,

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 study, or investigation.
2) Ability: Innate potential to perform mental and physical actions.
3) Personal Attributes: Individual traits, values, motives that indicate employee's
behavior.
4) Skills: Result of repeatedly applying knowledge or ability.

Advantages of Competency Profiling

The advantages of competency profiling are as follows:
1) It provides a clear guideline to all members of staff regarding the behavioral
indicators that they will be assessed on, when staff are involved in the competency
profiling process, they will gain insight and clarity regarding their role and
responsibilities;
2) It can also serve as motivation when employees track their development over their
career;
3) It allows for training needs and Return on Investment (ROI) to be readily assessed
and measured and finally it provides managers with key information with which
to make decisions on the selection or development of employees.

Personal Attributes

C o m p e t en c y A p p r o a c h i n R e c r u i t m e n t and Retention
Companies very conveniently use the competency approach in the important HR
function of recruitment and retention. 'Competency mapping plays a significant role
in recruitment, selection, induction, and placement as it gives a more accurate analysis of
the job requirements and the candidate's capability.

Elements of Recruitment and Retention

In any organization, recruitment needs consideration of the following points: I)
Identifying and recruiting good and talented people is difficult.
2) Retaining them is truly a much more difficult task.
3) Increasing attrition rate at managerial level.
4) Looking for responsibilities, recognition, comfortable working environment,

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 satisfaction, autonomy, etc., by high level managers.
5) Deriving satisfaction from saying 'I have done this', 'This is my achievement', etc., by
achievers.
6) Shaping individual's behavior through his/her need satisfaction.
7) Recognizing, appreciating, and nurturing subordinates' talents bring rewards.
8) Helping to take drives, and fulfilling desires directed tow ards achievements.

Competency-Based Selection Process

Competency-based selection can gain a greater competitive advantage. The market for
human talent is imperfect. High turnover is usually done with the high failure rate
amongst the newly hired. Competency-based selection increases performance and
also decreases turnover rates. High job performance and satisfaction in turn predict
retention because good performers need not be fired and satisfied employees are less
likely to be dissatisfied with their job. The people well-matched to their jobs intrinsically
enjoy their work more while producing a better organizational climate.

Steps to Develop a Competency-Based Selection System

There are concrete steps in developing a competency-based selection system:
1) Develop competency model for the target jobs.
2) Select or develop assessment methods.
3) Trainers certainly assessment that had.
4) Assess the competencies of candidates for jobs.
5) Make job person match decisions for selection placement and promotion.
6) Valid data selection system – wherever possible organization should track the
performance of people selected using competency assessment methods to confirm the
validating and return on investment in the method.
7) Develop a competency-based job and person database and matching system.
8) Many standard assessment center exercises can be observed and coded for competencies.
9) In basket exercises.
10) Stress exercises and interviews.
11) The presentation, vision, and strategy speeches.
12) Job interview.

Competency Mapping Procedures and Steps (Module 6) , 267

13) Leaderless group exercises
14) Treasure hunt.
15) Business production game.
16) Role plays.
17) Peer coaching and counseling exercises.

In a selection interview, rating of the candidates by managers can be completed to 360

77
degree meeting or appropriate rating methods can be used. This can include
competency assessment questionnaire or a competency queue starts, customer survey,
systematic multiple level observation of groups, manager style, and organizational
climate.

Preparing Organizations to Facilitate Competency-Based Selection Process

Organizations commence at the socialization stage as a part of the selection process
and follow it through formal training interventions, feedback mechanisms,
appraisals mentoring, etc., the roles and responsibilities at each of these stages of the
competency selection process is explained below:

Stage 1: Socialization: Organizations today, particularly those at the leading edge of

technology, are faced with a dynamic environment, shaking the very roots of
humanvalues and organization competency-driven culture. There is an increasing need for
experimentation, for learning from exper ience, for Ilexibility, and adaptability for
growth.

A strong competency-driven culture is a set of shared meanings – values, norms, and

beliefs, a way of doing things, that make it possible for members and new members of
an organization interpret and act upon their environment thereby helping everyone to
head in a unipolar direction as that of the organization.

In organizations to get new recruits too acclimatize into a competency-driven culture an

elaborate familiarization and socialization program is being drawn for various level.

stage 2: Selection Standards and Hiring Demands: The corporation in search for
talent has articulated policies for hiring of top performers would subject applicants for
employment to a selection process so rigorous and extended that it often seems
designed to discourage individuals rather than encourage them to take on the company
and the job. By employing selection standards and methods, by grilling the applicants
through the several stages of assessment interviews, highlighting strengths and weaknesses
and making sure not to oversell the job or the company, the organization prods the candidate.

Stage 3 Basic Familiarization Program: This is followed by a business familiarization

program to all new recruits through a orientation of the corpora ion by providing
them a bird's eye view of our business/functions and the leavers these businesses and
functions. The objective of this familiarization program is to help the new recruit to meet
with a random assortment of managers of the company including senior managers,
understand the profile of people across the company, appreciate the values, the climate and
the competency-driven culture in which the company operates.

Stage 4: On-the-Job Training: An specific instances for professionals like field/territory sales
managers, production managers in far-flung locations the company is expected to conduct an
on-the-job training program completely structured ranging between a periods of 24-46 weeks

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as the case may be, depending upon the needs of the individual manager.

Stage 5: Unit/Factory/Sales Branch Familiarization: Soon after the new recruit completes
his/her corporate familiarization, he/she is sent to the concerned unit where he is being
located for his initial placement for on-the-job training. On joining at. the unit, the unit head in
turn draws a 3-5 day familiarization program providing more in-depth information the overall
unit's operations.

Competency-Based Feedback
The feedback is regular, planned, and is a joint endeavor to make improvements
happen. Tasks and agreements are recorded and action plans drawn for improvement.
Therefore, there are quarterly appraisals that are completed by the unit head on each of the
managers working at the unit and the appraisals are so designed to provide upfront feedback on
the strengths, areas of development of the new recruit, This feedback is based on the experience
that the unit head has encountered alongwith the new recruit during the first quarter or second
quarter as the case may be. This feedback is of vital importance as the new manager is
constantly curious know-how the new organization is looking at his performance, learning, and
his contribution.

It is, therefore, the organization's responsibility to provide the manager complete inputs
on how he has been shaping-up and settling-down in the organization and, at the same time,
also tell him frankly and fairly, the areas he needs to sharpen or develop. The unit head, while
going through his feedback session will not stop at identifying areas but would also take pains to
help the new recruit to identify ways and means to overcome these weaknesses.

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 Module 7
Methods Of Data Collection For Mapping

Following are the methods of data collection for mapping:

1) Observation method,
2) Repertory grid,
3) Critical incidence technique,
4) Expert panels,
5) Surveys,
6) Automated expert systems,
7) Job task analysis,

8) Behavioral event interview

1) Observation Method
Resource persons observe the top and average performers while working and taking
decisions, interacting with people, leading co-employees, learning new aspects, and
applying them. Typically, the first part of such report contains record of observations
and the second part observer's own interpretation and analysis of this record. This
observation of extreme performers in action facilitates identification of the
competencies required to carry-out a task or job in the most efficient manner and also,
what inadequacy in competencies result in average performance. However, effectivene ss
of this method depends upon the objectivity and neutrality of observers.

Advantages of Observation Method

1) Used in Competency Studies: Because observations provide a sample of what the job
is like in "real life", they are often used in competency studies to provide preliminary
information. This serves as an excellent orientation to the job for the research team.
2) Validity is High: If representative samples of employees are observed, the validity of the
competencies identified is high because actual job behavior is viewed.
3) Provide a Full Perspective of the Job: Observations can provide a full perspective of
the job when incumbents' interactions with colleagues, managers, and clients are
observed.
4) Verbal and Non-Verbal Behavior can be Observed: Both verbal and non-verbal
behavior can be observed. Many employees in an organization tend to have greater
confidence in competencies identified through observations.
5) Directness: A major advantage of observation as a technique is its directness.
One does not ask people about their views, feelings, or attitudes; interviewer
watches what they do and listens to what they say.
6) Presented in Natural Setting: Moreover, data collected by observation may describe

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 the observed phenomena as they occur in their natural setting. Other data
collection methods introduce elements of artificiality into the research environment.

Disadvantages of Observation Method

1) Time-Consuming: The primary disadvantage is that these are very time-consuming and
expensive, especially for complex jobs.
2) Validity and Credibility Low: if only a relatively small proportion of job incumbents are
observed, the validity and credibility of the results can be low.
3) Extensive Experience is Required: Extensive experience in competency work and
strong analytical ability is required to accurately infer the competencies from the
observations.
4) Biasness of the Observer: There is considerable opportunity for bias by the observer in
filtering and documenting the job behavior.
5) Need for trained Observer: Requires that observer be trained to observe relevant job
behaviors.

2)Repertory Grid
In a repertory grid analysis, the jobholder is asked to write on separate cards the names of
atleast six people whom .he supervises or works with. The jobholder separates the cards
into two sets, one those who are good at work and other those who he considers are less
efficient. The cards are shuffled with name face down and the jobholder is asked to pick
two cards from a pile and one from the other. The jobholder has to now describe the ways
in which the two are similar to each other and different to the third. This process
generates a list of attributes. The jobholder is asked to describe the behavioral
indicators that made it possible to distinguish the good and less efficient.

The repertory grid technique can hel p a company to identify its core competencies
as well as superior performance competencies. This technique is best used by businesses
that are either in the introductory stage, where it is important to identify key success
factors, or in the maturity stage, where becomes critical. This is done at the level of
"elements". For example, the team might identify a company with an excellent
distribution network as a threat; distribution is the element in this case. These constructs
are laddered, or taken to their logical denouement to understand the core competencies
of the business. The same approach is used to arrive at superior-performance
competencies; only, this time instead of companies, the team identifies three people:
1. A superior performer,
2. performer, and
3. A low performer.
Thus, the competencies stand revealed.

Advantages of Repertory Grid

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The advantages of repertory grid are as follows:
1) Effective in both picking-up unexpected competencies.
2) Avoids the existing bias or prejudice.
3) It has the ability to focus on the key aspects which are important performance.
4) If does not predetermine the outcome of the analysis by confining responses to
predetermined formats.
Disadvantages of Repertory Grid
1) Need skilled practitioners to undertake them.
2) Rely upon view points of effective performance, is that biases about the way in which jobs
should be performed creep into the process for being selected.
3) Overlook the crore standards which are essential for all levels of performance.

3)Critical Incidence Technique

The jobholders are interviewed in a systematic manner. They are asked structured
questions about what situation and challenges they have faced. The remarks about what
they thought did and consequences of the actions are note down. Both the incidences,
ones in which the interviewee has been successful and also unsuccessful, are recorded.
The interviewee is asked about what factors he/she attributes to the success or failure in an
incidence. The recorded observations are analyzed to infer the needed competencies.

This approach draws on the learning from the past behavior. Due to the dynamic
nature of the business and strategies, there is a danger that past learning may not be a
correct indicator of the competencies_ needed today and in the future.

Advantages of Critical Incidence Technique

1) Focus on unusual or extraordinary may be more helpful than routine data
2) Does not force the respondents into any given framework
3) Flexible method
4) Inexpensive and provides rich information
5) Identifies even rare events that might be missed by other methods which only focus on
common and everyday events
6) Useful when problems occur but the cause and severity are not known
7) Emphasizes the features that will make a system particularly vulnerable and can bring
major benefits.
Disadvantages of Critical Incidence Technique
1) Respondents may be reluctant to express incidents that reflect badly on themselves.
2) The critical incidents are recorded after the events have already taken place — both
routine and non-routine.
3) The process of collecting a fairly good number of incidents is a lengthy one.
4) The analysts overseeing the work must have analytical skills and ability to translate the
content of descriptions into meaningful statements.

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5) Respondents may reply with stereotypes, not actual events (using more structure
improves this).
6) The meaning of "critical incident" must be clear to participants.

4)Expert Panels
In this method, a team or panel of experts is constituted to identify the competencies
required in the organization.

The experts are the following members:

1) Top management representatives (Strategic decision-makers).
2) Experts from different functional background who have a fair idea of the nature of
tasks performed in each function.
3) Representatives from the Human Resource Department.

The panel goes into the details of the critical behaviors needed for successful performance in
each job or a group of jobs. The business strategy and the expected behavior for
achieving the desired results is studied and documented. The panel could start with a list
of standard competencies and arrive at modifications needed. The advantage of this
method is that it is a faster process and a politically expedient way to define competencies
as experts may question the validity of the methodology.

Advantages of Expert Panels

1) Quick and Efficient collection of Data: Quick and efficient collection of a great deal of
valuable data.
2) Kn o wle d ge ab le f o r P an e l M emb e rs: Pan e l me mb ers be co me knowledgeable
in competency concepts, assessment methods, and variables; and their
involvement can develop consensus about and support for study findings.

Disadvantages of Expert Panels

1) Possible Identification of Folklore or Motherhood Items: Such items sound good and
reflect the traditions of the organization but do not predict competent performance.

2) Omission of Critical Competency Factors for which Panel Members Lack

Psychological or Technical Vocabulary: For example, superior furniture salespeople have
competency called "eliciting visual and tactile imagery", which means they think in terms
of color (mauve, taupe, rust) and textures (nubby, silky, scratchy). They also get their
customers to think in these terms, and thus can steer the prospect to specific
pieces of furniture. Expert panel members may not know a concept such as "eliciting
imagery", and hence would miss this important competency.

Surveys
A survey is "a process of collecting data from existing population units, with no particular
controle over factors that may affect the population characteristics of interest in the

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study".Almost every country in the world uses surveys to estimate their rate of
unemployment, basic prevalence of immunization against disease, opinions about the
Central Government, intentions to vote in an upcoming election, and people's satisfaction
with services and products that they buy. Surveys are a key tool in tracking global
economic trends, the rate of inflation in prices, and investments in new economics
enterprises. Surveys are one of the most commonly used methods in the social sciences
to understand the way societies work and to test theories of behavior. In a very real way,
surveys are a crucial building block in a modern information-based society.

Characteristics of Surveys
Surveys that have the following characteristics:
1) Information is gathered primarily by asking people questions.
2) Information is collected either by having interviewers ask questions and record
answers or by having people read or hear questions and record their own answers.
3) Information is collected from only a subset of the population to be described — a
sample — rather than from all members.
Advantages of Surveys
1) Quick and Inexpensive Data Collection: Considerable data can be collected quickly
and inexpensively.
2) Easy Information Gathering: Information can be easily collected from geographically
dispersed respondents.
3) Convenient: Respondents may complete the survey at a time and place that is
convenient for them.
4) Facilitate Acceptance of Competency Study: Surveys permit the input of many people
in the organization, and thus facilitate acceptance of the competency study.
5) Can be Easily Customized: The survey questionnaires can be easily customized for
sub-groups of respondents.
6) Encourage Candid Responses: The anonymity of surveys encourages candid
responses.
7) Data can be Easily Summarized and Analyzed: The multiple-choice or rating-type
questions result in quantitative data that can be easily summarized and analyzed.
Disadvantages of Surveys
I) Collected Data is Limited to Job Content or Competencies: The data collected is often
limited to the job content or competencies included in the survey. For example,
respondents may be asked to list additional job competencies that they believe are
important, but there is no opportunity to probe their responses as you might in
interviews and focus groups.
2) Lack of Mechanism for Understanding Questions: There is no mechanism to
check for respondents' understanding of the questions.

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 3) Low Response Rates: Response rates are typically low, so it can be challenging to
secure an adequate representative sample.
4) Difficult to Summarize and Analyze: It is difficult to summarize and analyze the
responses in open-ended questions.

6) Automated Expert System

Expert system tools can be used to analyze the need to re-schedule based on progress
toward expected performance. They can also identify problems in production schedules
developed for alternative scenarios and present them in an easy-to-interpret format. They
can extend the scheduler's experience and greatly ease the data analysis requirements.

Expert systems could perform data reductions as well as analyze the output. They could
make decisions to generate alternative scenarios and select the best. This application of
expert system technology would also be of use in automated environments, where the
user of the scheduling module might be a cell controller, or another CPU. In this
circumstance, the need is to be able to reschedule and evaluate the results of the
simulation scheduling application without human intervention. If the analysis
procedures could be captured in an expert system, the decisions could be made
automatically.

Advantages of Expert Systems

I) Access to Data: Access to several hundred competency studies in the database can
provide comparison data for reality-testing competencies suggested by other data
collection methods (e.g., filling in competencies found in previous studies of a job when
missed by a current study).
2) Efficiency: Serving as "smart" questionnaires, expert systems quickly narrow
questions to those relevant to the job being analyzed, rather than eliciting answers on
all questions from all respondents as surveys do.
3) Productivity: Expert systems analyses can provide in an hour what other competency study
methods require days or weeks to produce. Expert systems do not require highly trained
experts, saving labor time and expense.

Disadvantages of Expert Systems

1) Dependency: Data depend on the accuracy of responses to questions (i.e., expert
systems are subject to "garbage in garbage out" problems). This is also true of panels,
surveys, and other data sources, but the computerized expert system may be more
vulnerable when used in an unsupervised setting.
2) Overlook Specialized Competencies: The method may overlook specialized
competencies not in the database. Like questionnaires, expert systems can find only
those competencies that have been programmed in. They cannot discover new
competencies or organization-specific nuances of known competencies.

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3) Prohibitive Cost: Costs of system hardware and software may be prohibitive
(although with personal computers, these costs rarely exceed three days of specialist
consultant time).

7) Job Task Analysis

Basically, task descriptions are generated through the review training manuals or direct
observation of the job performance. The task descriptions are then clustered and
weighed to reflect the essence of the job.

The steps involved are:

I) Generation of task description item banks by scientific staff,
2) Subject matter specialists review the consolidated list and delete the tasks not
performed or out-of-date tasks,
3) The task list narrowed down to most representative tasks,
4) Experts rank the tasks based on the importance (least/most, sort tasks into clusters
based on the performance requirements,
5) Competencies required performing the tasks identified.

This method requires a great deal of time and effort.

Advantages of Job Task Analysis

1) Produces complete job descriptions.
2) Can validate or elaborate on data collected by other methods.
3) Easily done.
4) Does not require elaborate skills or training.
5) Appropriate for lean form of analysis.
6) Very job related.

Disadvantages of Job Task Analysis

1) Provides characteristics of job rather than those of the people who do the job well.
2) Task lists too detailed to be practical and do not separate truly important tasks from
the routine activities.
3) Inappropriate for broader goals.

8) Behavioral Event Interview

The behavioral interview technique (BEI) is used by employers to evaluate a candidate's
experiences and behaviors in order to determine their potential for success. The
interviewer identifies desired skills and behaviors, then structures open-ended questions
and statements to elicit detailed responses. A rating system is developed and selected
criteria are evaluated during the interview. This methodology is used to identify
competencies in a person. It includes sitting through with the candidate in an
interview situation carrying-out a behavioral interview followed by recording of responses

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and identification of behavioral codes. These codes will in turn help in identifying the
competencies in a person and arriving at a form of relative ranking for each competency:
1) Empirical identification of competencies,
2) Precision about how competencies are expressed,
3) Freedom from gender, cultural, bias,
4) Generation of data for assessment, training, etc.

Advantages of Behavioral Event Interview

1) Provide Perspectives of Job Challenges and Competencies: The interviews provide
an in-depth perspective of the job's challenges and the competencies needed to master
them.
2) Discriminate Between Top Performance and Baseline Competencies: When average
and low performers are interviewed as well as high performers, BEIs clearly
discriminate between the competencies required for top performance and the baseline
competencies needed for acceptable performance.
3) Identify Interpersonal and Management Competencies: BEIs are an excellent
method for identifying the interpersonal and management competencies that are
often difficult to define.
4) Used to Develop Behavioral Examples: The very specific descriptions of effective and
ineffective behaviors produced in BEIs can be used to develop behavioral
examples for competency models or case studies, role-plays, or other simulations for
training.
5) Empirical Identification of Competencies Beyond or Different from those Generated
by other Data Collection Methods: BEI data are by far the most valuable for validating
competency hypotheses generated by other methods and for discovering new
competencies.
6) Precision about How Competencies are Expressed: This refers not only to the "use of
influence" but to how influence is used to deal with specific situation in a specific
organization's political climate.
7) Identification of Algorithms: BEI data can show exactly how superior perfimiter,
handle specific job tasks or problems. For example, the Navy wanted to help officers
to handle race-relations issues. The BEI method was used to ask superior and average
officers to describe the toughest race relations incidents they had faced. Analysis of
about 60 stories of volatile situations revealed eight specific actions superstar
officers took either to avoid racial conflicts or to deal with them quickly, fairly, and
effectively. These action steps could then be taught to other officers.
8) Freedom from Racial, Gender, and Cultural Bias:
i) The BEI approach has been adopted by many organizations because it is
predicatively valid without being biased against minority candidates.

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 ii) Generation of Data for Assessment, Training, and Career Pathing: Behavioral
event interviews provide very specific descriptions of effective and ineffective job
behaviors that can show and teach others what to do — and what not to do — on the
job.

Disadvantages of Behavioral Event Interview

1) Time and Labor Intensive: BEIs are time and labor intensive. Up to a full day can be
required to conduct an interview and then analyze the data.
2) Requires Highly Trained and Skilled Interviewer: A highly trained and skilled interviewer is
essential to obtain accurate information. The interviewer must have strong
analytical ability and experience in competency identification to accurately infer the
competencies.
3) Inefficient for Analyzing Series of Jobs: BEIs are not practical for analyzing a series
of jobs because of the time, expense, and expertise required for administration and
data analysis.
4) Focus on Current and Past Behaviors: BEIs focus solely on current and past behaviors, which
may be different from those needed in the future.
5) Because BEIs focus on critical incidents, the competencies needed for the more routine
aspects of work may be missed.
6) The data collected may not be widely accepted by stakeholders because it is provided
by a small number of interviewees.

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 MODULE 8
Developing Competency Models From Raw Data

Competency model can be developed from

1) Behavioral Event Interview (BEI),
2) Survey,
3) Panel,
4) Expert,
5) System, and
6) Observation Data.

Analyzing Behavioral Event Interview Data

Two "thematic analysis" methods are used to identify competencies in BEI data:
1) Coding interview transcripts for known competencies, using the Competency
Dictionary; and
2 ) Co n ce pt u aliz in g n e w co mp et en ce the me s f ro m in t erview n arrat ive s.
Thematic analysis is the most difficult & creative part of the competency analysis process.

Thematic Analysis:
This ability is itself two levels of the competency conceptual Thinking:
1) Use of concepts Is the ability to re cognize or apply a concept already known from
previous study or research.
2) Concept creation or "Conceptualization" is the ability to recognize a pattern arid
invent it new concept to make sense of raw data.

Thematic analysis is a continual comparing and contrasting of superior and average

performers. Any difference may suggest a competency.

It may be helpful to organize observations of difference into general categories, such as the
following three:
1) Cognitive/Intellectual: Skills involved in creating, getting, or using information;
learning from experience; objectively analyzing data; or t h i n k i n g t h r o u g h
a l t e r n a t i v e s f o r a c t i o n . U s e o f c o n c e p t s , conceptualization, analytic
thinking, logical thought, and divergent thinking are cognitive/intellectual
competencies.
2) Interpersonal: Skills involved in communicating with, understanding, and influencing
others, such as accurate empathy, positive regard and expectations, articulateness
and public speaking ability are interpersonal competencies.
3) Motivational: The needs or drives that cause people to want and do different

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 things; achievement, affiliation, and power motives; and emotional self-control,
are motivation competencies.

Identifies Competencies: What To Look For

One systematic way to organize thematic analysis of competency data is to look at

how superior & average people answer each of the key questions:

1) Situation: Do supiror & average talk about different kinds of thing s in their BEIs? Do
they focus on different parts of job? Self-concept competencies are often indicated
by the way people think about their lobs (e.g., "I am a salesman" versus "I am an
administrator").

2) Who is Involved: Are there differences in the why superiors and averages see
their involvement with people or equipment? Do they regard others positively
or negatively?
For Example: Alcoholism Counselors, Diplomats Consultants
.
Superiors express positive regard Averages express negative
and expectations for clients. sentiments toward clients.

She was having a bad time, but I Face it – we get the real dregs here
knew she was a strong person – there is not much we can do for
who was going to get it together. them.

3) Thoughts: Are there differences between superiors and averages in the way
they think, use concepts or knowledge, make sense of complex data, remember
details, organize things in logical order

For Example: Manufacturing Managers, Military Officers, Pilots

Superiors are high in attention to
detail: They think in checklists and
are able lo tick-off numerous items
involved in planning tasks; they
are also high in logical thought
prioritizing tasks in order of
importance and scheduling them in
logical order.
There were 20 steps required to get
the aviation fuel-pumping system
Averages talk about tasks in vague,
general terms, appear
overwhelmed by detail, and do not
prioritize or schedure tasks by
detail, or in logical order.
I am in a continual state of crisis
management. There is no way to

4) Motivation: Do superiors and averages talk about wanting different things? Do

they see situations in different terms?

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 For Example: Small-Business Entrepreneurs
Superiors think about Averages think about power,
achievement, doing better against influencing others, enhancing their
goals. status.
I set my goal at 110% of quota, for I knew the way to impress the
the challenge – last year I'd made competition was to put on a
quota, and just doing that again did splashy show with a big booth at
not seem like much fun. the trade fair, so I did it, even
though I could not really afford it.

5) Actions: Do superiors or averages do different things or show different skills in

dealing with similar situations or people?
For Example: Entrepreneurs, Managers, Superstars in Almost Every
Field
Superiors are proactive: take initiative Averages are reactive: tend not
non-routine action to accomplish to take non-routine actions,
objectives or solve problems - and and give up rather than persist
persist (try two or more action steps to when blocked.
overcome obstacles) when blocked.
She wanted a transfer - she was a good I sent the request through
kid and I wanted to keep her. I called channels. Personnel said no. I
Personnel; they said "no way". I called patiently explained to her that
Corporate; they said the same. I kept there was not much I could do
submitting the request. Then I - it was out of my hands.
remembered I had a friend in Texas who
had some clout at Corporate and who
owed me one. I called him, and he
pounded it through.

Identifying Competencies: How to Look

The following team approach has been found to help researchers in identifying competencies.
This approach consists of three analysis and four validation steps.

Analysis Steps
Step 1) Form the Analysis Team: Ideally, a competency thematic analysis team should
include atleast four persons who conducted the BEIs for the study. If fewer
interviewers were used, non -interviewers experienced in thematic analysis may
also be suitable. Interviewers are preferred because the very experience of
interviewing and observing subjects in their work settings makes team members
more sensitive to the nuances, language, and culture of the people and job being
studied.

Step 2) Individual Analysis of Interviews: Analysis team members work in pairs. Each
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 analyst receives BEI transcripts for a mix of four to six superior and average
interviewees drawn from a sample of half of the interviews conducted (but atleast
10). Analysts should receive some of their own interviews and some done by other
team members. This minimizes analyst bias yet ensures a variety of analyst
perspectives.

Working independently, each analyst reads each assigned transcript and identifies
competency themes. Good practice is to underline everything in an interview that
might suggest a competency theme. Any competency recognized from the
competency dictionary is noted, or coded, on the margin of the transcript opposite
the words underlined. The analysts use their own words for themes and/or the
abbreviation for the competency and its level.

A high-tech method of coding uses a word processor with multiple windows. The
transcript is in one window and the competency dictionary in another. Examples of
competencies can be copied from the transcript to the dictionary to provide custom
examples of each competency level coded. The dictionary itself can be
customized by tailoring the definitions of competencies and competency levels to
describe the data.

Step 3) Thematic analysis team definition of competencies: The analyst team meets in
daylong sessions to discuss & document competency themes identification by
individual analysis of transcripts

Validation Steps:
If the competency model is to be used for research or selection, additional validation
steps can be used to refine the Competency Model Dictionary and develop inter-rater
reliability.

Step 4) Preliminary Testing of the Competency Coding System: Individual Coding:

Analyst team pairs receive copies of the codebook and copies of BEI transcripts not
previously coded. Each analyst codes the transcripts assigned to him or her,
indicating the competency abbreviation from the codebook after each note in the
transcript.
Step 5) Analyst Team Meets to Reconcile Coding: Analyst team pairs meet to discuss
their coding, reconcile differences, and agree on coding for each interview
transcript. This process results in further refinement of the competency code book.
Step 6) Statistical Analysis of preliminary BEI sample: Interview code is analyzed statistically to
see: if codes have reached an acceptable level of inter-rater reliability.
Step 7) Coding the Remainder of the BEI Sample: The revised codebook is validated by
scoring applied to the remainder of the BEI transcripts (i.e., transcripts not
considered in Steps. 1-5). Two members of the core interview team will ordinarily be
selected to code these interview transcripts. Coders independently score these

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 transcripts blind (i.e., they do not know whether the transcript they are scoring is
that of a superior or average performer), They meet only to discuss problem
cases or examples that are difficult to code.

Step 8) Final Statistical Analysis: Statistical analyses are performed on the scores given to
the BEI transcripts in the validation sample to see if the codebook competencies really
distinguish superiors from averages.

Step 9) Preparation of Final Competency Codebook for the Job: The final Competency
Codebook is prepared. It contains precise definitions of each competency with
detailed rules and examples of scoring from BEI transcripts.
Issues In Developing Competency Model
Competency practitioners and consultants have followed various combinations
steps in developing the model and assessing the competencies. Steps have been added,
deleted, modified, and refined depending on both the internal and external factors.

In general, all the practitioners or consultants have addressed the following six issues while
developing the model:
1 )Strategize: Assess business needs, evaluate contextual drivers, engage ,stakeholders,
and set goals.
2) Initiate: Identify methodologies, develop project plans, review existing data,
benchmark competencies, and collect competency data.
3) Model: Analyze and synthesize data, identify competencies and develop models, and
validate models.
4) Pilot: Develop implementation and evaluation plans, develop and initiate competency
applications, and continuously communicate activities.
5) Link: Link to all human resources system components, and phase in implementation
of other competency-based applications.
6) Evaluate: Establish and evaluate measures, and continuously improve the system.

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