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This posting discusses performance appraisal in Lansing-Smit

SCENARIO: You are the Director of Compensation and Benefits for Lansing-Smith Corporation, a 6-month old sales and service organization that currently has a workforce of 150 employees. You recently joined the organization when the Vice President of Operations decided to move the Compensation and Benefits function out of the Accounting Department, into a separate function. From your own observations you have identified several areas in need of review, redesign or development, including projects such as an audit of current pay plans to ensure they are aligned with federal regulations, an analysis of various pay plans to assess which plans will provide maximum benefit for Lansing-Smith, extensive job analyses to ensure a solid understanding of each position, job evaluations to determine the worth of the positions, consideration of various incentive plan designs to identify a plan that effectively drives individual and group performance to achieve production goals and research, development, communication and management training for a company-wide performance appraisal process.
You are dedicated to developing compensation and benefit practices that are motivating and empowering for employees. You are confident that with well-developed programs and practices, employees will be motivated to perform at higher levels, thereby driving overall company performance.

As the company approaches its first year in operation, you are planning to roll out a company-wide performance appraisal program. The CEO is relying on you to develop a program that will drive company performance.
Using the internet and the other resources, locate information on performance appraisal programs. Then develop a detailed plan to present to your CEO. This plan should include:

Discussion of the various programs you have considered,
Which program you have selected and why.
How will the new program be communicated to employees?
What type of training will need to be provided for managers?
What additional issues/challenges need to be considered with the implementation of this program?

Solution Preview

STEP 1
Discussion of the various programs you have considered,
There are several programs for performance appraisal. These include the following: This material is taken direct from the website: http://www.performance-appraisal.com" In a landmark study, Locher & Teel (1977) found that the three most common appraisal methods in general use are rating scales (56%), essay methods (25%) and results- oriented or MBO methods (13%). For a description of each, follow the button links on the left.

Certain techniques in performance appraisal have been thoroughly investigated, and some have been found to yield better results than others.

Encourage Discussion
Research studies show that employees are likely to feel more satisfied with their appraisal result if they have the chance to talk freely and discuss their performance. It is also more likely that such employees will be better able to meet future performance goals. (e.g., Nemeroff & Wexley, 1979).
Employees are also more likely to feel that the appraisal process is fair if they are given a chance to talk about their performance. This especially so when they are permitted to challenge and appeal against their evaluation. (Greenberg, 1986).

Constructive Intention
It is very important that employees recognize that negative appraisal feedback is provided with a constructive intention, i.e., to help them overcome present difficulties and to improve their future performance. Employees will be less anxious about criticism, ...

Solution Summary

This posting discusses performance appraisal in Lansing-Smith Corporation. Issues related to selection of employees for appraisal and the manner in which he program will be communicated are also described in detail.

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