CHAPTER 7

Training can...
◆ Increase employees’ knowledge of foreign
competitors and cultures.
◆ Increase employees’ knowledge of foreign
competitors and cultures,
◆Help ensure that employees have the basic skills to
work with new technology,
◆Help employees understand how to work effectively
in teams to contribute to product and service quality.
◆ Ensure that the company’s culture emphasizes
innovation, creativity, and learning.
◆Ensure employment security by providing new ways
for employees to contribute to the company when their
jobs change, their interests change, or their skills
become obsolete.
◆ Prepare employees to accept and work more
effectively with each other, particularly with minorities
and women.

Training is a planned effort by a company to facilitate

the learning of employees. Ensuring Employee Readiness for Training
High-leverage training:
◆is linked to strategic business goals and objectives, ◆Motivation to learn is the desire of the trainee to
◆is supported by top management, learn the content of the training program.
◆relies on an instructional design model, and ◆Self-efficacy is the employees' belief that they can
◆is compared or benchmarked to programs in other successfully learn the content of the training program.
organizations. ◆Managers can increase employees' self-efficacy level
Continuous learning requires employees to understand by:
the relationship between their jobs, their work units, ◆ Letting employees know that the purpose of
and the company and to be familiar with company training is to improve performance, not identify
business goals. incompetencies.
◆Providing as much information as possible about
the training program and its purpose.
◆Showing employees the training success of their
peers.
◆Providing employees with feedback.

Basic Skills

Cognitive Ability - verbal comprehension, quantitative

ability, and reasoning ability.

Reading Ability - the difficulty level of written materials

Creating a Learning Environment

◆Employees need to know why they should learn.
◆Employees need meaningful training content.
◆Employees need to have opportunities to practice.
◆Employees need feedback.
◆ Employees learn by observing, experiencing, and
interacting with others.
◆ Employees need to commit training content to
memory.
◆Employees need the training program to be properly
coordinated and arranged.

Cross-Cultural Preparation
◆An expatriate is an employee sent by his or her
company to manage operations in a different country.
◆To be successful in overseas assignments, expatriates
need to be:
◆Competent in their area of expertise
◆Able to communicate verbally and nonverbally in
the host country.
◆ Flexible, tolerant, and sensitive to cultural
Selecting Training Methods differences.
◆Presentation Methods ◆Motivated to succeed, able to enjoy the challenges,
◆Instructor-led classroom format
and willing to learn.
◆Distance learning ◆Supported by their families.
◆Audiovisual techniques

Hands-on Methods
◆On-the-job training
◆Simulations
◆Business games and case studies
◆Behavior modeling

◆Interactive video
◆Web-based training

Managing Workforce Diversity

To successfully manage a diverse work force,
companies need to ensure that:
◆ Employees understand how their values and
stereotypes influence their behavior toward others of
different gender, ethnic, racial, or religious backgrounds.
◆ Employees gain an appreciation of cultural
differences among themselves.
◆Behaviors that isolate or intimidate minority group
member improve.
Types of diversity training:
◆Attitude awareness and change programs
◆Behavior based programs

Socialization and Orientation

Organizational socialization is the process by which

new employees are transformed into effective
members of the company.

The three phases of socialization are:

1. Anticipatory Socialization

2. Encounter Phase

3. Settling In

Three Phases of Socialization

◆ Through anticipatory socialization, expectations
about the company, job, working conditions, and
interpersonal relationships are developed.
◆ The encounter phase occurs when the employee
begins a new job.
◆ In the settle-in phase, employees start to feel
comfortable with their job demands and social
relationships.
◆ Orientation programs play an important role in
socializing employees. It involves familiarizing new
employees with company rules, policies, and
procedures
CHAPTER 8 THE COMPARATIVE APPROACH

PERFORMANCE MANAGEMENT RANKING

● Simple ranking ranks from highest to lowest
is the process through which managers ensure that performer
employee activities and outputs are congruent with the
● Alternation ranking - crossing off best and worst
organization's goals. employees
PERFORMANCE APPRAISAL FORCED DISTRIBUTION
● Employees are ranked in groups
is the process through which an organization gets ● helps managers to tailor development activities based
information on how well an employee is doing his or her on their performance
job. PAIRED COMPARISON

PERFORMANCE FEEDBACK ● Managers compare every employee with every other

employee in the work group.
is the process of providing employees information
regarding their performance effectiveness. THE ATTRIBUTE APPROACH
GRAPHIC RATING SCALES
● A list of traits is evaluated by a five-point rating scale
● Legally questionable

MIXED-STANDARD SCALES
● Define relevant performance dimensions and then
develop statements representing good, average, and
poor performance along each dimension.
BEHAVIORAL APPROACH ● Control Chart
CRITICAL INCIDENTS APPROACH ● Histogram
● Requires managers to keep record of specific ● Scattergram
examples of effective and ineffective performance
BEHAVIORALLY ANCHORED RATING SCALES (BARS) SOURCES FOR PERFORMANCE INFORMATION
BEHAVIORAL OBSERVATION SCALES (BOS) 1. Customers
ORGANIZATIONAL BEHAVIOR MODIFICATION 2. Self
● A formal system of behavioral feedback and 3. Subordinates
reinforcement.
4. Peers
ASSESSMENT CENTERS
5. Supervisors
● Multiple raters evaluate employees’ performance on
a number of exercises RATER ERRORS IN PERFORMANCE MANAGEMENT
1. SIMILAR TO ME
RESULTS APPROACH 2. CONTRAST
MANAGEMENT BY OBJECTIVES 3. CENTRAL TENDENCY
● Top management passes down company’s strategic 4. HALO AND HORNS
goals to next layer of management, and these managers REDUCING ERRORS AND APPRAISAL POLITICS
define the goals they must achieve.
PRODUCTIVITY MANAGEMENT AND EVALUATION APPRAISAL POLITICS
SYSTEM (ProMES)
● A situation in which evaluators purposefully distort
● Goal is to motivate employees to higher levels of
ratings to achieve personal or company goals
productivity.
TWO APPROACHES TO REDUCING RATER ERROR
QUALITY APPROACH
A PERFORMANCE MANAGEMENT SYSTEM DESIGNED ● Rater error training
WITH A STRONG QUALITY ORIENTATION CAN BE
EXPECTED TO: ● Rater accuracy training
● Calibration Meetings
• Emphasize an assessment of both person and system
factors in the measurement system IMPROVING PERFORMANCE FEEDBACK
● Emphasize that managers and employees work
1. Feedback should be given frequently, not once a year
together to solve performance problems
2. Create the Right Context for Discussion
● Involve both internal and external customers in 3. Ask employees to rate their performance before the
setting standards and measuring performance session
● Use multiple sources to evaluate person and system
4. Encourage the subordinate to participate in the
factors
session
STATISTICAL PROCESS QUALITY CONTROL TECHNIQUES
5. Recognize effective performance through praise
USED:
6. Focus on solving problems
● Process-flow analysis
● Cause-and-effect diagrams 7. Focus feedback on behavior or results, not on the
person
● Pareto Chart
8. Agree to specific goals and set a date to review
progress

9. Minimize criticism

MANAGING PERFORMANCE OF MARGINAL

PERFORMERS

SOLID PERFORMERS

● High ability and motivation; managers should provide

development opportunities

MISDIRECTED EFFORT

● Lack of ability but high motivation; managers should

focus on training

UNDERUTILIZERS

● High ability but lack motivation; managers should

focus on interpersonal abilities

DEADWOOD

● Low ability and motivation; managerial action,

outplacement, demotion, firing

FOLLOWING LEGAL GUIDELINES

1. Conduct a valid job analysis related to performance.

2. Base system on specific behaviors or results.
3. Train raters to use the system correctly.

4. Review performance ratings and allow for employee

appeal

5. Provide guidance/support for poor performers

6. Use multiple raters

CHAPTER 9

Approaches to Employee Development

◆Formal education

◆Assessment
◆Myers-Briggs test

◆Assessment center
◆Benchmarks

◆Performance appraisals Job Experiences

◆Job experiences ◆Job enlargement refers to adding challenges and new
◆Interpersonal relationships responsibilities to employees’ current jobs.
◆Job rotation involves providing employees with a
Assessment Centers
◆At an assessment center, multiple raters or evaluators series of job assignments in various functional areas of
evaluate employees’ performance on a number of the company or movement among jobs in a single
functional area or department.
exercises.
◆ A transfer is usually a lateral move in which an
◆Usually off-site.
employee is given a different job assignment in a
◆Types of exercises include: different area of the company.
◆Leaderless group discussion ◆A downward move occurs when an employee is given
a reduced level of responsibility and authority.
◆Interviews
◆In-baskets Temporary Assignments
◆Role plays ◆Externship refers to a company allowing employees to
take a full-time operational role at another company.
Feedback Systems
◆ Temporary assignments can include a sabbatical
◆Upward feedback is a performance appraisal process which is a leave of absence from the company to renew
for managers that includes subordinates’ evaluations. or develop skills.
◆ 360 Degree Feedback is a performance appraisal Characteristics of Successful Mentoring Programs
system for managers that includes evaluations from a ◆Participation is voluntary
wide range of persons who interact with the manager. ◆Matching process if flexible
◆Mentors are chosen on ability and willingness
◆Purpose is clearly understood higher-level jobs in the company that adversely affects
◆Program length is specified women and minorities.
◆Minimum level of contact is specified
◆Contact among participants is encouraged ◆Succession planning
◆Program is evaluated ◆Identifying high-potential employees.
◆Dysfunctional managers
◆Employee development is rewarded

Benefits of Mentoring Relationships for Protégés

◆Career Support
◆Coaching, protection, sponsorship, and providing
challenging assignments, exposure, and visibility.
◆Psychological support
◆Serving as a friend and role model, providing
positive regard and acceptance, and creating an outlet
for a protégé to talk about anxieties and fears.
◆Additional benefits
◆Promotion, higher salaries, and greater influence.

Coaching
◆A coach is a peer or manager who works with an
employee to motivate him, help him develop skills, and
provide reinforcement and feedback.
◆Three roles a coach can play include:

◆one-on-one
◆help employee learn for himself or herself
◆may involve providing resources such as mentors,
courses, or job experiences

Special Issues

◆Melting the glass ceiling

◆The glass ceiling is a barrier to advancement to
CHAPTER 10  Interactional justice refers to the interpersonal
nature of how the outcomes were implemented.
EMPLOYEE SEPARATION ANDRETENTION
Four Determinants of Interactional Justice
To compete effectively, organizations must take steps
to ensure that good performers are motivated to stay 1) Explanation.
with the organization, whereas chronically low
performers are allowed, encouraged, or if necessary, 2) Social sensitivity.
forced to leave. 3) Consideration.
The two types of turnover are:
Involuntary turnover—turnover initiated by the 4) Empathy.
organization (often among people who would prefer to
PROGRESSIVE DISCIPLINE
stay).
Voluntary turnover—turnover initiated by employees Effective discipline programs have two central
components:
MANAGING INVOLUNTARY TURNOVER
 documentation
 The employment-at-will doctrine is a policy
that allows for termination of an employee  progressive punitive measures
with or without a “good or just cause.”
The organization determines responses for first, second,
 Violence in the workplace caused third offenses, and so on.
by involuntary turnover has become a major
organizational problem in recent years. ALTERNATIVE DISPUTE RESOLUTION

 A standardized, systematic approach  This is a method of resolving disputes that does

to discipline and discharge is necessary. not rely on the legal system.

PRINCIPLES OF JUSTICE The four stages of ADR are:

 Outcome fairness refers to the judgement that 1. Promote an open-door policy.

people make with respect to the outcomes
2. Perform peer reviews by individuals at the same
received relative to the outcomes received by
level in the organization.
other people with whom they identify.
3. Mediation by a neutral third party.
 Procedural justice focuses specifically on the
methods used to determine the outcomes 4. Arbitration organization by a professional,
received. from outside the

Six Determinants of Procedural Justice  EMPLOYEE ASSISTANCE PROGRAMS

These are programs that attempt to
1) Consistency.
ameliorate problems encountered by workers
2) Bias suppression. who are drug dependent, alcoholic, or
psychologically troubled.
3) Information accuracy.
 EAPs are usually identified in official
4) Correctability. documents published by the employer.
5) Representativeness.  There are several issues in controversy
6) Ethicality. regarding EAPs.
OUTPLACEMENT COUNSELING  Employees can sue their employers when
the disputed policies relate to an aspect
 A form of counseling that trys to help displaced of employment that is covered by legislation.
employees manage the transition from one job
to another. PHYSICAL WITHDRAWAL

 Can be performed in-house or through an There are several ways a dissatisfied withdrawal
outside source.
worker can physically from the organization:
 It is aimed at helping people realize that losing a
 Leave the job
job is not the end of the world and that
other opportunities exist.  Internal transfer
MANAGING VOLUNTARY TURNOVER- JOB  Absenteeism
WITHDRAWAL
 Tardiness
 Progression of withdrawal is a theory
that dissatisfied individuals enact a set PSYCHOLOGICAL WITHDRAWAL
of behaviors in succession to avoid their work
situation.  If the primary dissatisfaction has to do with the
job itself, the employee may display a very low
Three categories include: level of job involvement, which is the degree to
which people identify themselves with their
 behavior change Whistle-blowing jobs.
 physical job withdraw  If the dissatisfaction is with the employer as
 psychological job withdraw a whole, the employee may display a low level
of organizational commitment, which is the
o Job Involvement degree to which an employee identifies with
the organization and is willing to put forth
o Organizational Commitment effort on its behalf.
Withdrawal behaviors are related to one another, and JOB SATISFACTION AND JOB WITHDRAWAL
they are all at least partially caused by job
dissatisfaction. Job satisfaction is a pleasurable feeling that
results from the perception that one's job fulfills
BEHAVIOR CHANGE or allows for the fulfillment of one's important job
 An employee's first response to values.
dissatisfaction would be to try to change the Three important aspects satisfaction are:
conditions that generate the dissatisfaction.
 values,
 When employees are
unionized, dissatisfaction leads to an increased  perceptions, and
number of grievances.
 importance.
 Employees sometimes initiate change
through whistle-blowing - making grievances Frame of Reference is a standard point that serves as a
public by going to the media. comparison for other points and thus
provides meaning.
  It usually reflects average past experiences. Role-analysis technique - enables a role occupant and
other members of the role occupant’s role set to
 It can also reflect perceptions or other peoples’ specify and examine their expectations for the role
experiences. occupant

SUPERVISORS AND COWORKERS

A person may be satisfied with his or her supervisor

and coworkers for one of three reasons:

 shared values, attitudes, and philosophies,

 strong social support,

 help in attaining some valued outcome.

PAY AND BENEFITS

SOURCES OF JOB DISSATISFACTION For many people, pay is a reflection of self worth, so
pay satisfaction takes on critical significance when it
TASKS AND ROLES comes to retention.

Job enrichment -referring to a specific way to add SURVEY FEEDBACK INTERVENTIONS

complexity and meaningfulness to a person's work.
Reasons for routinely surveying employee
Job rotation- the process of systematically moving a attitudes include the following:
single individual from one job to another over the
course of time.  It allows the company to monitor trends over
time. uIt provides a means of assessing change
PERSONAL DISPOSITIONS impacts in policy.

Negative affectivity - a term used to describe a  If a company uses a standardized scale, it

dispositional dimension that reflects pervasive can compare itself with others in the same
individual differences in satisfaction with any and all industry.
aspects of life.
 If a company provides feedback and a
TASKS AND ROLES (CONTINUED) corresponding action plan to deal with
problems, dissatisfaction can become a plus.
Role – what an organization expects from an
employee. Surveys:

Role ambiguity - the level of uncertainty about what  emphasize overall satisfaction.
the organization expects from the employee in terms
of what to do or how to do it.  assess the impact of changes in policy.

Role conflict - the recognition of incompatible or  allow the company to compare itself with
contradictory demands by the person who occupies the others in the same industry.
role.
 allow the company to check for differences
Role overload - a state in which too many expectations between units and benchmark “best practices”
or demands are placed on the person. that might be generalized across units.
 Give employees a constructive outlet for voicing
their concerns and frustrations. Voicing is a
formal opportunity to complain about one’s
work situation.
CHAPTER 11 Developing Pay Levels – Market Pressures

Pay Structure Decisions Two important competitive market challenges in

deciding what to pay its employees:
Introduction
 Product-market competition – the challenge to
From the employer’s point of view:
sell goods and services at a quantity and price
 Pay is critical in attaining strategic goals. that will bring a return on investment.

 Pay has a major impact on employee attitudes  Labor-market competition – the amount an
and behaviors. organization must pay to compete against other
organizations that hire similar employees.
 Employee compensation is typically a significant
organizational cost. Employees as a Resource

From the employee’s point of view:  A philosophy that considers employees to be an

investment that will yield valuable returns.
 Policies having to do with wages, salaries, and
other earnings affect their overall income and  Controlling costs through noncompetitive pay
thus their standard of living. can result in low employee productivity and
quality.
 Both level of pay and fairness compared with
others’ pay are important.  Pay policies and programs are one of the most
important human resource tools for
Pay Decisions encouraging desired employee behaviors and
discouraging undesired behaviors.
 Pay structure refers to the relative pay of
different jobs (job structure) and how much Deciding What to Pay
they are paid (pay structure).
 Deciding pay levels is discretionary, and is based
 Pay level is the average pay in organizations, on a broad range.
including wages, salaries, and bonuses.
 The organization has to decide whether to pay
 Job structure is the relative pay of jobs in at, below, or above the market average.
organizations (i.e., the range of pay often
expressed by salary grades).  Efficiency wage theory states that wages
influence worker productivity.
 Pay policies are attached to jobs, not individuals.
 The benefits of higher wages may outweigh
Equity Fairness higher costs when the organization's technology
or structure depends on highly skilled
Two types of employee social comparisons of pay are
employees or when the organization has
especially relevant in making pay-level and job structure
difficulty observing and monitoring employee
decisions:
performance.

Market Pay Surveys

 Benchmarking is a procedure by which an

organization compares its own practices
against those of the competition.
The following issues must be determined before pay The evaluation process is composed of compensable
surveys are used: factors, which are the characteristics of jobs that an
organization values and chooses to pay for.
 Which employers should be included in the
survey? Job evaluators often apply a weighting scheme to
account for the differing importance of the
 Which jobs are included in the survey? compensable factors to the organization.

 If multiple surveys are used, how are all the Developing a Pay Structure
rates of pay weighted and combined?
Three pay-setting approaches include:

 Market survey approach - The greatest

emphasis is on external comparisons. It bases
pay on market surveys that cover as many key
jobs as possible.

 Pay-policy line - A mathematical expression

that describes the relationship between a job’s
pay and its job evaluation points.

 Pay grades - Grouping jobs of similar worth or

content together for pay administration
purposes.

Rate Ranges  The range spread is the distance between the

minimum and maximum amounts in a pay
 Rate ranges refer to different employees in the grade.
same job that may have different pay rates.

 Key jobs are benchmark jobs that have

relatively stable content and are common to Conflicts between Market Pay Surveys and Job
many organizations so that market-pay survey Evaluation
data can be obtained.
 In resolving the conflict, emphasizing the
 Nonkey jobs are unique to organizations and internal data would drive up labor costs and
cannot be directly valued or compared through creates product-market problems.
the use of market surveys.
 If external market data are emphasized and a
job is paid lower internally, the comparisons
that employees make internally would result in
Developing a Job Structure dissatisfaction.

 A job structure refers to the relative worth of  There are no right answers. An organization
various jobs in the organization, based on should consider its strategy and what jobs
internal comparisons. and/or functions will be critical for success.

 Job evaluation is an administrative procedure

that measures a job's worth to the organization.
  The bureaucracy, time, and cost required to
generate and update job descriptions can
become a barrier to change.

 The job-based structure may not reward

desired behaviors, where the knowledge, skills,
and abilities needed yesterday may not be
helpful today and tomorrow.

 The system encourages promotion-seeking

behavior, but discourages lateral movement.

Responses to problems with job-based pay

structures include the following:
Globalization, Geographic Region, and Pay Structure
 Delayering is reducing the number of job levels.
 Pay structures can differ substantially across This provides more flexibility in job assignments
countries both in terms of their level and in and assigning merit increases.
terms of the relative worth of jobs.
 A second response to job-based pay structure
 Expatriate pay and benefits continue to be problems has been to move away from linking
linked more closely to the home country. pay to jobs and toward building structures on
However, this link appears to be slowly skill, knowledge, and competency.
weakening and now depends more on the
 Skill-based pay typically pays individuals for the
nature and length of the assignment.
skills they are capable of using rather than for
the job they are performing at a point in time.

Current Challenges

Job-based pay structures can create the following

problems:
Executive Pay
 They encourage bureaucracy.
Executive pay has been given widespread attention in
 They reinforce top-down decision making as the press.
well as status differentials.
 However, executive pay accounts for a small
proportion of the labor costs of an organization,
 and executives have a disproportionate ability The proportion of black to white earnings in 2000
to influence organizational performance. was 79 percent.

 Executives also help set the culture, so if their Comparable Worth

pay seems unrelated to organizational
Comparable worth (or pay equity) is a public policy that
performance, employees may not understand
advocates remedies for any under evaluation of
why their pay should be at risk depending on
women's jobs.
the organization's performance.
 Based on the idea that individuals should obtain
equal pay, not just for jobs of equal content, but
for jobs of equal value or worth.

 The courts have consistently ruled that using

the going market rates of pay is an acceptable
defense in comparable worth litigation suits.

Wage Laws

 The Fair Labor Standards Act (FLSA) of 1938

established a minimum wage and overtime pay
rate.
Reasons for Executive Pay Criticisms
 Minimum wage is the lowest amount that
 Some executives are very highly paid, such as employers are legally allowed to pay.
the CEO of Walt Disney, who earns over $600
million.  Minimum wage now stands at $5.15 an hour.

 Executives in the United States are the best paid  Executive, professional, administrative, and
in the world. outside sales are exempt from FLSA coverage.
The ratio of executive pay to average worker
 Exempt means that these employees are not
pay is cited as creating a "trust gap" in which
covered by the FLSA, and they are not eligible
workers do not trust executives' intentions and
for overtime pay.
resent their pay.
 The Davis-Bacon Act and Walsh-Healy Public
Equal Employment Opportunity
Contracts Act require federal contractors to pay
 Equal Employment Opportunity (EEO) (Title VII) employees no less than the prevailing wages in
prohibits discrimination in all employment the area.
outcomes, including pay, unless business
necessity can be proven.

 Two trends related to EEO are the increasing

participation of women and nonwhites in the
labor force.

The proportion of wages that women earn compared to

men was 76 percent in 2000.