[Slide 2 – Here is the overarching framework we introduced in the last module. You just discovered ways firms attract an effective workforce to their organization. Now that we’ve got these workers on board, our attention moves to the second of these main HR goals: that of developing workers into the most effective they can be, to benefit both themselves personally but also so that they can contribute to the organization’s current and future goals.

[Slide 3 - If we consider what influences employee performance, a very general model might be the following: employee performance is a function of Ability X Motivation. Ability refers to elements such as employee knowledge, skills, and abilities, or whether they have adequate resources to do the job, or even the degree to which environmental factors (e.g., economic climate, competitor actions) impact one’s ability to attain some desired performance level. The second issue relates to motivation. How much effort and commitment is being exhibited towards

Performance? Together these factors can determine overall performance. We can refer to the ability factors as the “Can Do” factor…can the employee do their job, attain the desired performance level in their job The motivation can be consider the “Will Do” factors…..will the employee do his/her job. They may have the ability but are unwilling to put forth the needed effort to attain an acceptable level of performance. As you can see, these two factors – ability and motivation – are in a multiplicative function. This indicates that both factors must be non-zero in order for employee performance to be non-zero….said another way, if either factor is low, we can expect, in general, for employee performance to be relatively low. By the way, these two factors are not entirely independent. For instance, being low in ability may result in less effort being extended. However there are many issues related to motivation, a topic we will be exploring in a future module.

Effective training and performance appraisal programs can help a manager identify and address performance problems.

[Slide 4 – Organizations in the U.S. devote a large part of their resources to training and development programs. Most estimates are that U.S. companies spend over $60 billion dollars a year are spent on training programs. So who do you think wins when a workforce improves its skills and abilities through training?

Most economists see this expenditure as a win-win situation for just about all parties. The employee wins by gaining knowledge, skills, and abilities, which can lead to improved compensation and greater career opportunities and options. The employer wins by having a higher quality and more productive workforce which possess up-to-date skills aligned with their organizational needs. And society as a whole wins by having a more highly skilled workforce to attract foreign investment and being more able to compete in the global employment market.

[Slide 5 – This model illustrates the process a firm can use to determine whether training is needed, and if so, training on what specific issues. This model guides us to look at what tasks, behaviors, and abilities are needed on three different levels: the overall organization, the job, and the individual.

[Slide 6 – The model presented on the previous slide helps us determine whether training is needed in our organization. This step is more commonly referred to as a Needs Analysis. Once we identify a need, the next steps are to actually design the appropriate training program, deliver the program, and follow up with evaluation of the effectiveness of the training. This last step, evaluation, is often neglected by management. What sorts of issues do you think you would examine to determine whether a training program was effective? Pay particular attention to your text’s discussion of this part of the training process.

[Slide 7 – This slide presents some of the common training methods discussed in your chapter. On-line training is an increasingly popular method of delivery. Hewlett-Packard, for example, has on-line self-paced training programs on hundreds of topics that the majority of employees have access to at any time of the day.

[Slide 8 – The second piece of developing human resources relates to performance appraisal, the process of establishing performance standards and evaluating performance towards those standards. This is considered by many to be one of the most challenging and difficult aspect of human resource management. However, Jack Welch, the high-profile former CEO of General Electric considered performance appraisal a critical part of a manager’s job. Performance appraisals are conducted for a variety of reasons. Assessing performance provides documentation to support employment –related decisions, such as determining and justifying who receives raises, promotions, layoffs, training. This information also helps the employer identify training needs or to identify employees who can be developed for higher level positions in the organization. The performance appraisal process also provides information to employees about their performance. For some organizations, the annual performance appraisal interview may be the only time they actually have the opportunity to sit down with their boss and discuss their performance. Finally, the performance appraisal process clarifies to employees exactly what the organization expects, which behaviors are measured and therefore important.

[Slide 9 – The basic steps in the Performance Appraisal Process are listed on this slide. It starts by determining which behaviors, skills, abilities are important for a given job and finding measures for those behaviors. Recall, we can refer to our job analysis for this information. We then must construct the appraisal instrument, and there are many choices here as we will see in the next slide. Thirdly, we use the selected instrument and actually measure the performance. Finally, we give feedback on these performance measures to the individual employee in the performance appraisal interview.

An underpinning goal of this entire process is that we want our Performance Appraisal process to be an accurate reflection of an individual’s performance. We want a process that minimizes bias and subjectivity on the part of the evaluator, and where the results have high reliability and high validity. We can maximize the chance of obtaining this goal by careful thought to each step in the above process.

[Slide 10 – Your chapter does a fairly good job discussing the variety of performance appraisal methods that are commonly used. Which ones are you familiar with? Have any of these been used at companies you’ve worked for? What did you like and not like about the appraisal processes you’ve been associated with?

[Slide 11 – Finally, when the appraisal process indicates a performance gap between what is expected and what is realized, there are various options to explore, as noted in your chapter.

One of the activities for this module is the Self Assessment survey #43, to see how good you would be a giving performance feedback to an employee. Then, turn your attention to the next module which discusses how to maintain an effective workforce.