Reading: Lesson 6 - Improving Employee Performance

12.6.A - Improving Employee Performance

1. EMPLOYEE PERFORMANCE REVIEW

1. Companies depend on effective and satisfied employees. Just as a company cannot operate if equipment is outdated or malfunctioning, it must have employees with up-to-date skills who perform their jobs accurately and efficiently. Two requirements for maintaining a high-quality workforce are an effective system for performance review and well-designed training and development programs. Companies must ensure employees are performing as well as they possibly can. The process of assessing how well employees are doing their jobs is called performance review. The information obtained from performance reviews is then used for career planning, determining increases in wages and salaries, and planning training programs. Continuing poor performance reviews may lead to employee transfer, demotion, or even termination.
   
2. The first step in developing a performance review process is to determine what to evaluate. Each job should have an updated description of duties and performance expectations, which should be the primary focus of the review. Next, the human resources department prepares forms and procedures for performance reviews. Those materials should be designed to make the review process as easy and objective as possible. Managers conduct formal performance reviews of all employees, usually once a year. The formal review is based on regular observations of the employee’s performance throughout the year, checking the quality and quantity of the work the employee has produced and gathering information on the effectiveness of the employee’s interactions and relationships with coworkers and customers. Some managers fail to conduct regular objective reviews of each employee’s work and instead base their evaluation on the most recent work, general observations, or even biases. This procedure is unfair to the employee and does not result in an accurate evaluation or provide the chance to recognize positive performance or improve employee performance in weaker areas. To be most objective, managers should use observation forms and record information on the employee’s performance. Those forms and records should be specific to each employee’s job and based on the employee’s job description and job responsibilities. These records should also take into account the employee’s experience and training. If observations are too general or do not consider any unique requirements or expectations, they will not be fair, can be legally challenged, and will not contribute to specific performance improvement.
   
3. Based on the information collected, the manager fills out an evaluation form about the employee’s performance. The process in many companies also requires the employee to complete a self-evaluation using the same form. Some companies use 360-degree feedback, or similar methods, to obtain feedback from other pertinent staff members. Employees should be just as careful and objective in completing their self-evaluation as they expect their supervisor to be. Some employees find it difficult to specifically identify their strengths and weaknesses. But being specific and honest in the self-assessment is important if the goal is to be recognized for positive efforts and results as well as to identify ways to improve performance. In the same way, the employee should not cover up work or skills that have not been up to standard. If the supervisor believes the employee is not being honest, it will be difficult for the supervisor to recognize the positive parts of the self-evaluation.
   
4. After the manager and employee have completed the performance evaluation forms, they should discuss the information in a performance review conference. The conference is scheduled soon after the forms are prepared. The goals of the meeting are to review all evaluation information, discuss the employee’s performance and the reasons for the ratings, recognize areas of strengths as well as those needing improvement, and agree on a plan for performance improvement, including support the manager will provide.
   
5. An upcoming performance review conference may be a source of anxiety for both managers and employees. However, if carefully planned, the evaluation meeting should be a positive experience. The following guidelines for managers can help in achieving that goal: 
   
   1. Schedule enough time for the discussion and plan for it by reviewing the employee’s job requirements, previous evaluations, and career plans. Inform the employee well in advance and provide copies of the information that will be reviewed.
   
   2. Focus on the employee’s performance, not on the employee. Feedback should be based on objective information, not opinions.
   
   3. Allow the employee to discuss his or her performance, the job, working conditions, and available support. Encourage the employee to be objective and focus on the responsibilities of the position, not on other individuals.
   
   4. Discuss strengths and areas needing improvement. Identify how the strengths can contribute to the employee’s career goals and specific ways the employee can develop needed skills and improve performance.
   
   5. Agree on a specific development plan for the next work period. The plan should outline how the employee can improve, what incentives he or she will receive for meeting goals, and the support that will be provided.
   
   
6. If performance is so far below standard that the employee may be penalized or even terminated, the manager should plan particularly carefully for that conference. The employee should not be surprised by the negative information. The decision should be based on previous evaluations as well as personal discussions the manager has held with the employee. Specific and objective reasons based on company policies and job requirements should be presented and discussed. The employee should have the opportunity to offer information, but the discussion must remain positive rather than argumentative. The manager should give the employee specific information on the penalties or termination procedures and arrange a meeting for the employee with the appropriate human resources personnel. Although the conference will not be easy, the manager should maintain a positive tone and thank the employee for the contributions made to the department and the company.
   
7. In addition to the formal performance review procedures, managers should regularly provide informal feedback, support, and encouragement to every employee. Employees also can conduct regular self-assessments or ask managers, coworkers, or others who know them well for feedback. These informal reviews can be very helpful to employees in understanding how well they are performing their jobs and what needs to be done to improve performance or to prepare for promotions and career advancement.
   

1. Businesses spend a great deal of money on training activities designed to improve the productivity of their employees. Training is divided into two categories, based on how it is organized and delivered. Formal training is carefully planned instruction with a specific curriculum and instructional resources. It may be conducted by supervisors, experienced employees, or professional trainers. Formal training may be offered by the company, professional and trade associations, schools and colleges, or private companies. Formal training can be delivered in traditional classrooms, training centers, laboratories, or organized areas in the workplace. It is increasingly delivered using such technology as computers, the Internet, and training simulators. Informal training is unstructured instruction developed for specific situations or individuals. Informal training is often delivered by a supervisor, coworker, or mentor in one-on-one situations with an individual employee or a small group of employees. For example, a coworker might show a new employee how to perform a specific job, or a vendor might demonstrate a new piece of equipment or software to employees who will use it. Informal training also includes self-study by individual employees and coaching provided by a supervisor or mentor. Studies estimate that U.S. companies spend over $70 billion each year on formal training programs. Informal training may cost businesses as much as an additional $200 billion each year. Beyond the costs of training, many companies pay some or all of the costs of college courses that employees take as part of preparing for promotions and career advancement or as an employee benefit. The large allocation of money for training and development can be justified if it results in increased productivity and higher-quality work among employees.
   
2. As companies recognize the value of training, they are working to develop more effective training procedures. On the average, companies spend more than $1,000 on every employee each year for training. Therefore, they want to be sure the training is effective at improving employees’ performance. Effective training is designed to help people learn. Important principles of teaching and learning are highlighted in the Figure below. 
   

   
   

3. A critical activity for all companies is determining the need for employee training. Some training needs are obvious. When the company buys new equipment, begins new operations, or introduces new procedures, employees must be trained for the changes. When new employees are hired or experienced employees are promoted to new jobs, they do not have all the skills they need to begin work immediately. In these cases, companies should offer the needed training. Other training needs are not as obvious. In some instances, poor work performance can be a symptom of insufficient training. Conflicts among employees, areas of customer dissatisfaction, or work hazards and employee injuries often signal the need for training. Unless companies are aware of problems and try to determine whether training can help solve them, the problems are likely to continue. In some companies, each department forms a problem-solving group made up of managers and employees. Those groups can identify training needs in addition to their other responsibilities. Because they work regularly with the equipment and the procedures of the department, the groups are in a good position to identify performance problems and help design training programs.
   

4. The Bureau of Labor Statistics (BLS) reports on the common types of training provided by U.S. employers. They are:
   
   • Basic-skills training: training in reading, writing, arithmetic, and language skills, including English as a second language
   
   • Occupational-safety training: information on safety hazards, regulations, and safe working procedures 
   
   • Employee health and wellness training: information and guidance on issues such as stress reduction, nutrition, and smoking cessation
   
   • New-employee orientation training: introduction to the organization, coworkers, personnel, and workplace rules and procedures
   
   • Awareness training: information and guidelines on policies and practices that affect employee relations or the work environment, including affirmative action, workplace diversity, and sexual harassment
   
   • Communication, employee development, and quality training: training in public speaking, conducting meetings, writing, time management, leader- ship, working in groups or teams, employee involvement, total quality management, change management, and job re-engineering
   
   • Job skills training: training in specific skills for different types of jobs in the organization.