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02/20/2012

Thesis Chapter 4 - Examine The Effectiveness of Performance Management Of Wangfujing Department Store As Judged By The Employees


Chapter IV

Presentation, Interpretation and Analysis of Findings

 

Demographic Profile

Civil Status  

                Statistics

Q1

N

Valid

115

 

Missing

0

Mean

1.7130

 

 

 

 

                                                                        Q1

 

 

Frequency

Percent

Valid Percent

Cumulative Percent

Valid

Married

40

34.8

34.8

34.8

 

Single

68

59.1

59.1

93.9

 

Others

7

6.1

6.1

100.0

 

Total

115

100.0

100.0

 

 

 

 

Out of all the 115 respondents, 40 (34.8%) were married, 68 (59.1%) were single and 7 (6.1%) were separated/single parents.

 

Age

                      Statistics

 

Q2

N

Valid

115

 

Missing

0

Mean

1.5217

 

 

                                                                          Q2

 

 

Frequency

Percent

Valid Percent

Cumulative Percent

Valid

21-30

65

56.5

56.5

56.5

 

31-40

40

34.8

34.8

91.3

 

41 and up

10

8.7

8.7

100.0

 

Total

115

100.0

100.0

 

 

Out of 115 respondents, 65 (56.5%) were within the 21-30 age bracket, 40 (43.8%) were within the 31-40 age bracket and 10 (8.7%) were aged 41 and up.

 

Gender

                      Statistics

 

Q3

N

Valid

115

 

Missing

0

Mean

1.6000

 

 

                                                                        Q3

 

 

Frequency

Percent

Valid Percent

Cumulative Percent

Valid

Male

46

40.0

40.0

40.0

 

Female

69

60.0

60.0

100.0

 

Total

115

100.0

100.0

 

 

 

On the second part of the survey the respondents were asked to rate the importance of separate appraisal system attributes in building an effective performance appraisal system. This part of the survey was designed in order to ascertain the different attributes of a performance appraisal system that the employees value. The researcher used a four-point Likert scale with response choices ranging from “absolutely important” to “not important”.

 

The researcher, by reviewing different studies and literature about performance appraisal identified 31 attributes which were deemed by the researcher as important in the development and administration of an effective system. A response is scored as agreeing with the literature if the attribute is judged to be very important or absolutely important. Through this survey, the researcher will be able to find out if Wangfujing Department Store’s Appraisal System is effective. The effectiveness of the company’s performance appraisal will be measured by identifying whether the attributes that the respondents deemed as “important” are present in the company’s performance appraisal system.

Participation

Table1

 Statements

Mean

Interpretation

1. Participation by raters

1.9478

Very Important

2. Supervisory participation

3.4261

Somewhat Important

3. Employee participation

1.4261

Absolutely Important

4. Self-appraisal

3.4261

Somewhat Important

 

            There were three forms of participation that were included in the survey – rater participation, supervisory participation and employee participation. Employee participation in the performance appraisal process was considered by the respondents as absolutely important in effective performance management process. According to Roberts and Pavlak (1996) employee participation is linked with higher levels of performance appraisal system satisfaction, fairness, acceptance and trust. Employee participation therefore, should be considered by Wangfujing Department Store as employees tend to be more satisfied and they tend to view the performance appraisal process as effective if they are given the opportunity to participate in it. Rater participation was viewed by the respondents as very important in effective performance appraisal while they did not give considerable significance to supervisory participation and self-appraisal as components of effective performance appraisal.

Goal-Setting

 

Table 2         

 Statements

Mean

Interpretation

5. Specific goals

1.8348

Very Important

6. Allowing employees to set their individual goals

1.8348

Very Important

7. Participation of the employees performance goal setting

1.6696

Very Important

8. Setting of moderately difficult and challenging goals

3.6522

Unimportant

 

            Goal setting is considered as a critical component of an effective performance management program. Based on the results of the survey, the respondents consider setting of specific goals, allowing employees to set their individual goals and allowing employees to participate in the performance goal setting as very important in effective performance management. On the other hand, the respondents view setting of moderately difficult and challenging goals as unimportant in effective performance management.

Performance Feedback

 

Table 3         

 Statements

Mean

Interpretation

9. Annual performance appraisal

2.7739

Somewhat Important

10. Day-to-day interaction and coaching

1.5043

Very Important

11. Two-way interaction between rater and ratee

1.5304

Very Important

12. Timely, specific and non-threatening feedback

2.2696

Very Important

13. Regular counseling sessions

1.4870

Absolutely Important

 

 

Based on the survey, the respondents put emphasis on the absolute importance of regular counseling sessions in effective performance appraisal. According to Roberts and Pavlak (1996) effective performance appraisal requires regular, ongoing two-way communications between rater and ratee. The respondents view annual performance reviews as somewhat important, favoring day-to-day interaction and coaching, two-way interaction between rater and rate and timely, specific and non-threatening feedback more. Yearly performance appraisal evaluations are no substitute for the essential day-to-day interaction and coaching that is characteristic of effective supervision and leadership. Raters must be skilled at presenting feedback in a timely, specific, behavioral, and non-threatening fashion. Regular performance counseling sessions in conjunction with the formal appraisal interview provide additional coaching and guidance.

Performance Standards

 

Table 4         

 Statements

Mean

Interpretation

14. Performance standards based on job analysis

2.2348

Very Important

15. Clear performance standards

1.1826

Absolutely Important

16. Measurable performance standards

1.4348

Absolutely Important

17. Properly communicated performance standards

2.5304

Somewhat Important

18 Participation of rater and ratee in performance standards development

1.8522

Very Important

19. Important dimensions of work are measured

1.3826

Absolutely Important

20. Rater training

1.2870

Absolutely Important

21. Raters possess requisite skills in administering performance appraisal

2.4783

Very Important

22. Ability of the rater to observe employee performance

2.3043

Very Important

23. Consideration of external factors beyond employee’s control that influence performance

2.2522

Very Important

24. Proper documentation

2.1826

Very Important

25. Top-level management support in the performance appraisal process

2.3565

Very Important

 

 

Performance standards are considered as the building blocks of the appraisal process. In terms of the development of the system, the first step is the production of performance standards based upon a comprehensive job analysis. This is considered by the respondents as very important. The respondents on the other hand, do not consider properly communicated performance standards as important. Both raters and ratees should participate in developing performance standards and the rating form. The dimensions of work performance that are evaluated should be the most important for effective job performance.

Rater and Employee Acceptance

 

Table 5

 Statements

Mean

Interpretation

26. Employee Attitude toward performance appraisal system

1.3652

Absolutely Important

27. Rater commitment

2.4783

Somewhat Important

28. Rater-ratee agreement on the definition of good performance

1.2696

Absolutely Important

29. Interpretation of performance appraisal

2.8348

Somewhat Important

30. Absence of bias

1.1130

Absolutely Important

31. Conformance to Government employment policies

3.0087

Somewhat Important

 

 

Effectiveness of Performance Management at Wangfujing Department Store

            The third part of the questionnaire aimed to determine the effectiveness of Wangfujing Department Store’s performance management as judged by the employees.

 

                                                                        

 

Mean

Interpretation

Job Analysis

2.5739

Uncertain

 

 

The result revealed that there was no consensus as to the effectiveness of job analysis as part of the company’s performance management system.

 

 

Mean

Interpretation

Job Description

2.4957

Effective

 

A job description indicates the role of an employee within the organization and what results they are expected to achieve on the job. Ideally, job descriptions present a clear picture of employees’ roles, responsibilities, required outputs, and standards used to judge the quality of their performance (Gilley and Maycunich 2000).

Judging from the mean of the responses, the respondents viewed the company’s job description as an effective component of the company’s performance management system.

                                                                        

 

 

Mean

Interpretation

Performance Plan

1.5043

Effective

Performance Objectives

1.5913

Effective

 

The respondents viewed the company’s performance plan as an effective. Performance objectives were also viewed by the respondents as effective.

Performance planning is the process where in goals are set. Goal-setting should be done by the manager and the employee. To create a good performance plan, employees need to know where they are now (the current state) and where they want to go (the goal state). Goals should be measurable and achievable. The plan should include process and support during the execution phase to help managers and employees do the things necessary to have the plan succeed. This includes monitoring progress, identifying and addressing problems, and helping employees stay on their edge to maximize their growth and their performance. The plan should be modifiable during the execution phase to respond to changing circumstances (Zwell 2000).

 

 

Mean

Interpretation

Communication of Performance Objectives

1.4087

Very Effective

 

The respondents viewed communication of performance objectives by Wangfujing Department Store as very effective.

 

Mean

Interpretation

Performance Appraisal Process

1.6957

Effective

 

Performance appraisal is the process by which an employee’s contribution to the organization during a specific period of time is assessed (Sims, 2002). Performance appraisal is integral to the successful operation of most organizations. During this process, employees are evaluated formally and informally to determine the nature of their contributions to the organization. Appraisal occurs during time periods and in meetings that are scheduled to produce reasoned consideration of contributions, but it also occurs informally as employee contributions are observed, or when an evaluation is brought to the attention of others (Dickinson, 1993). The respondents viewed the company’s performance appraisal process as effective.

 

Mean

Interpretation

Performance Appraisal Tool

2.5304

Uncertain

 

In terms of the company’s performance appraisal tool, the respondents were uncertain as to the effectiveness of that that the company is using. The company uses rating scales as its primary performance appraisal tool. The rating scale is among the widely used method of appraising the performance. The method is simple and easy to use. Rating scales according to Rudman (2003) are readily adaptable to suit specific jobs and organizations, and there are virtually no limit to the aspects of person or performance that can be rated. In simple terms, rating scales require the reviewer to rate the employee’s performance in an absolute sense, not in comparison to other employees. Employees can be rated on virtually any trait or characteristic or dimension of performance or behavior. The characteristics to be assessed are chosen and each step on the scale is given a brief description in terms of quantity and quality. Another performance appraisal tool that the company uses is checklist. Performance appraisal checklists provide the evaluator with a series of statements, phrases, or adjectives that describe employee performance. These statements may be subdivided into specific factors such as quantity of work, quality of work, and so forth, with the descriptors listed under each category. Occasionally, the phrases or adjectives are simply listed without categorization. The appraiser marks the statement or adjective considered to be most descriptive of the employee’s performance during the period covered by the appraisal.

 

 

Mean

Interpretation

Performance Feedback

2.1391

Effective

 

Among the keys to effective performance is knowing what is expected to succeed on the job, how well those expectations are being met and what actions are required to improve. Information about these expectations is included in the communications between the rater and the employee. These are transmitted, on an ongoing basis, through goal-setting and feedback. Goal-setting usually takes place at the beginning of the performance cycle; feedback occurs continuously throughout the process. The employee receives feedback in two ways. Informal feedback should follow completion of each significant task. Formal performance reviews can be done quarterly, semiannually or annually (Martin and Bartol, 1998).

Wangfujing Department Store’s performance feedback was judged by the respondents as effective.

 

Mean

Interpretation

Rater

3.5043

Ineffective

 

The Rater as the one who administer the performance appraisal system of the company was considered by the respondents as ineffective.

 

Mean

Interpretation

Annual Performance Review

3.1826

Uncertain

 

The respondents were uncertain of the effectiveness of the company’s annual performance review.

 

 

Mean

Interpretation

Day-to-Day Coaching

1.9130

Effective

 

The respondents viewed day-to-day coaching as an effective component of the company’s performance management system. All employees have a strong psychological need to know how well they are performing. An effective performance appraisal system ensures that feedback is provided on a continuous basis—not in an annual written evaluation, but in the form of daily, weekly, and monthly comments from a supervisor. The annual evaluation and its accompanying interview or performance discussion must be devoid of surprises. While the interview presents an excellent opportunity for both parties to exchange ideas in depth, it is not a substitute for day-to-day communication about performance (Caruth and Handlogten 2001).

 

 

Mean

Interpretation

Performance Measures/Criteria

2.6261

Uncertain

 

The respondents were uncertain of the effectiveness of the performance measures or criteria that that company is using in performance review and appraisal.

 

Mean

Interpretation

Alignment of performance management/appraisal to reward and compensation

2.1739

Effective

Alignment of performance to employee training and development

2.0957

Effective

 

            According to Martin and Bartol (1998) performance appraisal must be linked to other HR processes, particularly rewards and recognition and training and development of employees. As one indicator, rewards and recognition should correlate with performance ratings. Those who perform better should receive higher ratings and subsequently get higher pay raises, be promoted faster, attend more advanced training, be assigned to more significant jobs and receive other types of rewards and recognition, which accompany doing a job well. Performance appraisal, according to (Thomas and Bretz, 1994) is also indispensable in training and development activities to assess potential and identify training needs.

The respondents believed that the company’s performance management system is effectively aligned to its reward and compensation. The respondents also believed that the company’s performance management system is effectively aligned with employee training and development.

 

 

Mean

Interpretation

Performance appraisal documentation

1.8696

Effective

 

According to Roberts (1998) documentation is important in performance management as it can facilitate behavioral change and document employee strengths and weaknesses, and positive performance documentation provides an additional tool for recognizing employees. The respondents believed that the performance appraisal results are effectively documented.

Problems in Performance Management System

            Question1

 

 

Frequency

Percent

Valid Percent

Cumulative Percent

Valid

Unclear standards

20

17.4

17.4

17.4

 

Raters are not properly trained to facilitate performance ap

61

53.0

53.0

70.4

 

Performance appraisal tools that are being used are not enough

23

20.0

20.0

90.4

 

Insufficient Information

4

3.5

3.5

93.9

 

Personal Bias

7

6.1

6.1

100.0

 

Total

115

100.0

100.0

 

 

When asked which do they consider as the main problem in the company’s performance management system, 61 (53%) respondents identified “raters are not properly trained to facilitate performance appraisal” while 23 (20%) respondents stated that “performance appraisal tools that are being used are not enough”. 20 (17.4%) respondents identified “unclear standards as the main problem in Wangfujing Department Store’s performance management system. The top three performance management problems therefore are insufficient rater training, inadequate performance appraisal tools and unclear standards.

1. Insufficient Rater Training

The manager is the one who appraise or review employee performance. Presently, there is little training in how to evaluate performance and conduct performance appraisal interviews. The lack of training among appraisers has led to other difficulties and problems. The organization at present does not give much attention to training the managers in performing performance appraisal.

The effectiveness of performance appraisal is greatly affected by the ability of the raters to accomplish their task in reviewing, providing feedback, and identifying the needs of the employees. According to the ability of the rater to adeptly appraise the employee is critical to successful performance appraisal. Dorfman et al (1986) identified in their study the successful rater/supervisor behaviors in performance appraisal:

·         Providing a clear reason for conducting a performance evaluation interview.

·         Presenting the positive and negative qualities of the employees’ performance while maintaining a pleasant atmosphere and tone of conversation.

·         Participation discussions to resolve conflicts and clear up job problems.

·         Establish specific goals and discussing ways to improve job performance.

·         Indicating how the employee’s performance will affect pay and promotion decisions.

·         Using the review to increase understanding and communication.

·         Indicating the importance of the individual to the organization.

·         Providing support to the employee whenever possible.

Kirkpatrick (1986) suggested that rater training must provide the knowledge, teach the skills, and create the attitudes necessary for effective program implementation. If this can be achieved, perceived discrimination or accusations of subjectivity may be avoided or diffused (Dipboye, 1985).

2. Inadequate Performance Appraisal Tools

            The company uses rating scale as a primary performance appraisal tool. Rating scales are among the popular performance appraisal tools. They are easily to construct, use and understand. However, there are significant problems in using rating scales.

1. Ratings are sometimes subjective.

2. Not all the characteristics of a job are equally important and certain characteristics are more important for some jobs than for others.

3. Ratings can be given easily enough for individual characteristics or dimensions, but it is more difficult to turn into a valid or useful overall assessment.

            The performance appraisal tool that the organization uses is simple and easy to understand which is good because performance appraisal should be like that. However, it also has limitations and weaknesses.

Sample Performance Appraisal Form: Rating Scale

Performance Ratings

5 Points – Consistently Exceeds Expectations

  • Employee displays at all time, without exception, a consistently high level of factor related skills, abilities, initiative, and productivity.

  • All assignments/responsibilities are completed beyond the level of expectation.

  • Initiative and self-direction are characteristic.

 

4 Points – Often Exceeds Expectations

  • Employee displays a high level of factor related skills, abilities, initiative and productivity, exceeding requirements in some areas, but not consistently or not without exception.

 

3 Points – Meets Expectations

  • Employee displays and maintains an effective and consistent level of performance of the job factor under review. Work output regularly achieves desired or required outcomes or expectations.

  • Problems and errors are reported and corrected quickly.

 

2 Points – Some Improvement Needed

  • Employee at this level displays inconsistency in the performance of the job factor under review and output frequently falls beyond acceptable levels.

  • Tasks may be significantly late at times or incomplete, with serious or potentially serious consequences.

 

1 Point – Major Improvement Needed

  • Work output is consistently low, regularly fails to meet required outcomes, and error rate is high requiring repetition of duty or completion by others.

  • The employee may require constant supervision, and show an indifference to job responsibilities.

 

Performance Factors

Rating

5

4

3

2

1

Quality of Work

 

 

 

 

 

Productivity

 

 

 

 

 

Knowledge of the Job

 

 

 

 

 

Adaptability

 

 

 

 

 

Dependability

 

 

 

 

 

Initiative and Resourcefulness

 

 

 

 

 

Judgment and Policy Compliance

 

 

 

 

 

Interpersonal Relations

 

 

 

 

 

Attendance

 

 

 

 

 

Safety and Security

 

 

 

 

 

 

Another performance appraisal tool that the company uses is checklist. Shown below is an example of a simple checklist that are being used in Wangfujing Department Store.

 

Employee’s Name:

Reviewed By:                                                                           Date:

 

Does this Employee

 

Yes

 

No

 

1.  Arrive for Work on Time?

2.  Exhibit expertise in his/her job?

3. Have good working relationships with his/her co-workers and supervisors?

4. Follow the company’s rules and regulations?

5. Handle his work according to procedure?

6. Finish his/her work on time?

 

 

 

3. Unclear Standards

            Insufficient, inadequate and incorrect information is also a problem in the performance appraisal. Standards and processes in the performance appraisal are not well-defined. Also, the employees do not fully understand the purpose of the performance appraisal aside from ‘judging or measuring’ their contributions.

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