1

SEMESTER II LESSON PLAN 4- MBA / 203 UNIT IV- MANPOWER TRAINING & DEVELOPMENT Ref: 1. HR Planning by HK Bhattacharyya Ch7, Ch10 2. HR Mgt by Decenzo / Robbins Ch !. Personnel / HR Mgt by Decenzo / Robbins Ch10, Ch1" ". M#$2, Bloc%!, &nit', &nit11 (. M#$2, Bloc%2, &nit ) ). #*ggeste+ Rea+ings ,-ra.ati &ni.ersity$ syllab*s /or MB, 20! UNIT OBJECTIVES MANPOWER TRAINING AND DEVELOPMENT PER!ORMANCE APPRAISAL " POTENTIAL EVALUATION "JOB EVALUATION WAGE DETERMINATION " LEARNING OBJECTIVES INTRO DE!INING TRAINING AND DEVELOPMENT NEED !OR AND BENE!ITS O! TRAINING MET$ODS O! DETERMING TRAINING NEEDS TRAINING OBJECTIVES !ORMULATION O! TRAINING POLIC& PRINCIPLE O! AN E!!ECTIVE TRAINING PROGRAM TRAINING MET$ODS PRINCIPLES MANAGEMENT DEVELOPMENT OBJECTIVE O! MANAGEMENT DEVELOPMENT TEC$NI*UES O! MANAGEMENT DEVELOPMENT W$AT IS PER!ORMANCE APPRAISAL+ JOB PER!ORMANCE & PER!ORMANCE MEASUREMENT VALIDIT& & RELIABILIT& O! PER!ORMANCE APPRAISAL MET$ODS O! PER!ORMANCE APPRAISAL MA,ING PA MORE E!!ECTIVE T$E MEANING O! JOB DISCRIPTION- JOB ANAL&SIS & JOB EVALUATION !ACTORS A!!ECTING JOB VALUES MET$ODS O! JOB EVALUATION ESTABLING PA& STRUCTURE INCENTIVE COMPENSATION PLAN E.ECUTIVE COMPENSATION CONCLUSION REVIEW *UESTIONS CASE STUD&

1 2 3 4 # 1 2 3 4 # % ' ( ) 10 11 12 13 14 1# 1% 1' 1( 1) 20 21 22 23 24 2# 2%

INTRO 1. 0e ha.e seen ho1 a ne1ly /012345e26 e-2loyee is intro+*ce+ to his /ello1 1or%ers, his s*2er.isor, the 1or% o/ his +e2t, its relations to other +e2t an+ its 2lace in the 1hole org to the org ob3ecti.e, 2hiloso2hy, 2ractices 4 so on. 5he ne1 e-2loyee then has to learn to 1or% -ost e//iciently 4 e//ecti.ely. 5his is thro*gh a 1ell$tho*ght

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o*t 4 2lanne+ training 2rogra-. 5raining is re6*ire+ at e.ery stage 1hen a 2erson is -o.e+ /ro- one assign-ent to another o/ a +i//erent nat*re. DE!INING TRAINING & DEVELOPMENT 2. 5raining 4 De.elo2-ent 2rogra- are necessary in any org /or i-2ro.ing the 6*ality o/ 1or% o/ e-2loyees at all le.els, 2artic*larly in a 1orl+ o/ /ast changing technology, changing .al*es 4 en.iron-ent. !. 5he 2*r2ose o/ both is si-ilar. ". 5he -ain +i//erence is in res2ect to the le.el o/ e-2loyees /or 1ho- these are -eant /or an+ the content 4 techni6*es e-2loye+. # Training.7 Training is a short-term process utilizing a systematic and org process by which a non-managerial person acquires technical knowledge and skills for a definite purpose. It refers to instructions. It is designed primarily for non-managers. It is for short duration for a specific job-related purpose. ). !"!#$%&!'T. e(elopment is a long-term education process utilizing a systematic and org process by which managerial persons) get conceptual and theoretical knowledge. 7n other 1or+s it re/ers not to technical %no1le+ge or s%ills in o2eration b*t to 2hiloso2hical 4 theoretical conce2ts. 7t in.ol.es broa+er e+*cation 4 its 2*r2ose is long$ter- +e.elo2-ent. 7. BENE!ITS O! TRAINING , 1ell 2lanne+ 4 e8ec*te+ training 2rogra- sho*l+ res*lt in the /ollo1ing bene/its9$ a: Re+*ction in 0astage 4 s2oilage. b: 7-2ro.e-ent in -etho+ o/ 1or%. c: Re+*ction in learning ti-e. +: Re+*ction in s*2er.ising b*r+en. e: Re+*ction in -achine brea%age 4 -aintenance costs. /: Re+*ction in acci+ent rate. g: 7-2ro.e-ent in 6*ality o/ 2ro+*cts. h: 7-2ro.e-ent in 2ro+*ction rate. i: 7-2ro.e-ent in -orale 4 re+*ction in grie.ances. 3: 7-2ro.e-ent in e//iciency 4 2ro+*ction. %: Re+*ction in -an2o1er obsolescence. l: ;nabling the org to 2ro.i+e increase+ /inancial incenti.es, o22ort*nity /or internal 2ro-otion 4 raising o/ 2ay rates. -: Personal gro1th, n: 0i+er a1areness a-ong 2artici2ants enlarge+ s%ill. ( MET$ODS O! DETERMINIG TRAINING NEEDS 5otal nee+ can be +eter-ine+ by analyzing the sit in r/o o/ each s%ill 4 each -e-ber o/ 1or% /orce. 5his to +eter-ine training nee+s one 1o*l+ ha.e to analyse the /ollo1ing 9$ a: <ob Re6*ire-ent. b: ;-2loyees 2resent 3ob s%ills. c: 5raining =ee+s. T809 4:1 ;e 2<e9 01 58e f<==<>01? >:@9:a: ,nalysis o/ an acti.ity. b: ,nalysis o/ Proble-s. c: ,nalysis o/ Beha.ior. +: ,nalysis o/ an >rg. e: ,22raisal o/ Per/or-ance. /: Brainstor-ing. g: B*zzing. h: Car+ #orting. i: Co--ittee. 3: Co-2arison.

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%: Con/i+ence. l: Cons*ltants. -: Co*nseling. n: 7n$bas%et. o: 7nci+ent Pattern. 2: 7n/or-al 5al%s. 6: 7nter.ie1s r: >bser.ations s: Proble- Clinic. t: Research. *: Role$2laying. .: #el/$,nalysis. 1: #%ill$7n.entory. 8: #li2 0riting. y: #t*+ies. z: #*r.ey. aa: 5ests. bb: 5as% ?orce. cc: @*estionnaires. ++: 0or%sho2. ) TRAINING OBJECTIVES a: 5o 2re2are e-2loyees /or the 3ob -eant /or the- 1hile in /irst a22oint-ent on training, or on 2ro-otion 4 i-2art to the- the re6*ire+ s%ill an+ %no1le+ge. b: 5o assist the e-2loyees to /*nction -ore e//ecti.ely in their 2resent 2osition by e82osing the- to the latest conce2ts, in/or-ation techni6*es 4 +e.elo2ing the s%ills that 1o*l+ be re6*ire+ in their 2artic*lar 3obs. c: 5o b*il+ a secon+ line o/ co-2etent o//icers an+ 2re2are the- to occ*2y -ore res2onsible 2ositions. 10 PRINCIPLE O! E!!ECTIVE TRAINING PROGRAM a: 5he ob3ecti.es 4 sco2e o/ a training 2lan sho*l+ be +e/ine+ be/ore its +e.elo2-ent is beg*n in or+er to 2ro.i+e a basis /or co--on agree-ent 4 coo2erati.e action. b: 5he techni6*es an+ 2rocesses o/ a training 2rogra- sho*l+ be relate+ +irectly to the nee+s 4 ob3ecti.es o/ the org. c: 5o be e//ecti.e the training -*st *se teste+ 2rinci2le o/ learning. +: 5raining sho*l+ be con+*cte+ in the act*al 3ob en.iron-ent to the -a8i-*- 2ossible e8tent. '. TRAINING MET$ODS 5raining /or +i//erent categories o/ e-2loyees9$ a: &ns%ille+ 0or%er. b: #e-i$s%ille+ 0or%er. c: #%ille+ 0or%er. +: #ales-en. e: #*2er.isory #ta//. 10. ,ll training -etho+s can be broa+ly classi/ie+ into 50>9$ a: >n the 3ob training. b: >// the 3ob training. 11 ON T$E JOB TRAINING. ,n e-2loyee is 2lace+ in a ne1 3ob an+ is tol+ ho1 it is to be 2er/or-e+. 7t ai-s at +e.elo2ing s%ills an+ habits consistent 1ith the e8isting 2ractices o/ an org an+ by orienting hi- to his i--e+iate 2roble-s. Coaching 4 instr*ctions is +one by s%ille+ 1or%ers, s*2er.isors, s2ecial training instr*ctors. , .ariety o/ training ai+s 4 techni6*es are *se+. b: VESTIBULE TRAINING OR TRAINING CENTRE TRAINING 7t in.ol.es class$rootraining i-2arte+ 1ith the hel2 o/ e6*i2-ent an+ -achines i+enti/ie+ to those in *se at the

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2lace o/ 1or%. 5heoretical training is gi.en in the classroo- 4 2ractical con+*cte+ on the 2ro+*ction line. 7t is o/ten *se+ to train cler%s, Ban% tellers, ins2ectors, -achine o2erators, ty2ists etc. c: S0A3=:50<1 7t is an e8tension o/ .estib*le training. 5he trainee 1or%s on Aclosely +*2licate+ real 3ob con+itions.B 5his is essential 1hen on$the$3ob 2ractice is e82ensi.e, -ight res*lt in serio*s in3*ry, a costly error, Destr*ction o/ 2ro2erly e.g. Pilots 5raining. +: DeA< & EBeC409e. Here the trainer +escribes an+ De-onstrates ho1 to +o a certain 1or%. He 2er/or-s the acti.ity hi-sel/ going thro*gh a ste2 by ste2 e82lanation o/ the A1hyB, Aho1B A1hatB he is +oing. e: ADDCe1504e980D. , -a3or 2art o/ training is s2ent on the on$the 3ob 2ro+*cti.e 1or%. ;ach a22rentice is gi.en a 2rogra- o/ assign-ents accor+ing to a 2re+eter-ine+ sche+*le 1hich 2ro.i+es /or e//icient training in tra+e s%ills a22ro2riate /or$ cra/ts$tra+es 4 technical areas. 12. $**-T+!-,$- $. /#011 .$$& &!T+$ 1. 5raining on the 3ob is not a 2art o/ e.ery+ay acti.ity. Cocation o/ training -ay be a co-2any class$roo-, e+*cational instit*tions or an association 1hich is not a 2art o/ the co-2any. Metho+s incl*+e the /ollo1ings9$ a: Cect*res. b: Con/erence. c: #e-inars/ 5ea- Disc*ssion. +: Case Disc*ssion. e: Role Playing. /: Progra--e+ 7nstr*ction. a: Le453Ce9 ?or-ally organize+ tal%s by an instr*ctor on s2eci/ic to2ics. 5his -etho+ is *se/*l 1hen 2hiloso2hy, conce2ts, attit*+es, theories, 2roble-s ha.e to be +isc*sse+. b: C<1feCe14e Me58<2 Hel+ as 2er an org 2lan. M*t*al 2roble-s are +isc*sse+ 4 2artici2ants 2ool their i+eas an+ e82erience in atte-2ting to arri.e at better -etho+s o/ +ealing 1ith these 2roble-s. Me-bers teach 4 learn /ro- each other. Con/erence -ay incl*+e B*zz sessions 1hich +i.i+e con/erence into s-all gro*2s o/ "$( /or intensi.e +isc*ssion. 5his -etho+ is s*itable /or a gro*2 o/ 20$!0 2ersons only. c: SeA01:C <C Te:A D0943990<1 5he gro*2 learns thro*gh +isc*ssion o/ a 2a2er on a selecte+ s*b3ect. 5he 2a2er is 1ritten by one or -ore trainees. +: C:9e D0943990<1 , real / Hy2othetical b*siness 2roble- +e-an+ing sol*tion is 2resente+ to the gro*2 4 -e-bers are traine+ to i+enti/y the 2roble-s 2resent 4 s*ggest .ario*s alternati.es /or tac%ling the- analyse each one o/ these /in+ o*t their co-2onent s*itability 4 +eci+e /or the-sel.es the best sol*tion. 5his -etho+ 2ro-otes analytical thin%ing. ;8tensi.ely *se+ in 2ro/essional school o/ la1 4 Mgt 4 in s*2er.isory 4 e8ec*ti.e training 2rogra- in in+*stry. e: ROLE PLA&ING ,lso calle+ /R<=e ReE0e>01?6 or /S<40<-DC:A:6 or /D9@48<=<?04:= DC:A:6. Here trainees are gi.en o*t a role to 2lay as in a stages +ra-a. =o 1ritten lines no rehearsals. Players 6*ic%ly res2on+ to e.er changing sit*ation. 1!. MANAGMENET DEVELOPMENT 7s a syste-atic 2rocess o/ training 4 gro1th by 1hich -anagerial 2ersons gain an+ s*22ly s%ills, %no1le+ge, attit*+es 4 insights to -anage the 1or% in their org e//ecti.ely an+ e//iciently. 14 O;Fe450Ee9 <f M:1:?eAe15 DeEe=<DAe159 a: ,ss*re the org o/ a.ailability o/ re6*ire+ n*-bers o/ -anagers 1ith the re6*ire+ s%ills to -eet the 2resent an+ antici2ate+ /*t*re nee+s o/ the b*siness. b: 5o enco*rage -anagers to gro1 as 2erson 4 in their ca2acity to han+le greater res2onsibility. c: 5o i-2ro.e the 2er/or-ance o/ -anagers thro*gho*t their career. 1(. , Dasg*2ta in DB*siness 4 Mgt in 7n+iaE has gi.en ob3ecti.es o/ +e.elo2-ent o/ -anagerial 2ersons /or .ario*s le.el o/ -gt as *n+er9$ a) Top Mgt.

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5o i-2ro.e thro*gh 2rocess an+ analytical ability in or+er to *nco.er an+ e8a-ine 2roble-s an+ ta%e +ecision in the best interest o/ the co*ntry 4 >rg. ii. 5o broa+en the o*tloo% o/ the e8ec*ti.e role, 2osition 4 res2onsibilities. iii. 5o thin% thro*gh the 2roble-s 1hich -ay con/ront the organization. i.. 5o *n+erstan+, econo-ic, technical 4 instit*tional as2ects in or+er to sol.e b*siness 2roble-s. .. 5o ac6*ire %no1le+ge abo*t 2roble-s o/ h*-an relations. FB: MIDDLE MGT. i. 5o establish a clear 2ict*re o/ e8ec*ti.e /*nctions 4 res2onse. ii. 5o bring abo*t an a1areness o/ the broa+ as2ects o/ -gt 2roble-s. iii. 5o +e.elo2 the ability to analyze 2roble-s an+ to ta%e a22ro2riate action. i.. 5o +e.elo2 /a-iliarity 1ith -anagerial *ses o/ /in acco*nting. .. 5o inc*lcate %no1le+ge o/ h*-an -oti.ation 4 h*-an relationshi2s. .i. 5o +e.elo2 res2onsible lea+ershi2. FC: &I #! *2'/TI$'0# !3!/2TI"! 4 1%!/I0#I1T1. i. 5o increase %no1le+ge o/ b*siness /*nctions 4 o2erations in s2eci/ic /iel+s in -ar%eting, 2ro+*ctions, /inance, 2ersonnel. ii. 5o increase 2ro/iciency in -gt techni6*es, 1or% st*+y, in.entory control, o2eration research, 6*ality control. iii. 5o si-*late creati.e thin%ing. i.. 5o *n+erstan+ the /*nctions 2er/or-e+ in a co-2any. .. 5o *n+erstoo+ H*-an Relations 2roble-s. .i. 5o +e.elo2 ability to analyse the 2roble-s. 56. T!/+'I72!1 $* &0'08!&!'T !"!#$%&!'T. a: Planne+ Progression. b: <ob Rotation. c: Creation o/ A,ssistant$toB Position. +: &n+er$st*+y. e: Coaching$Co*nseling. /: 5e-2orary Pro-otions. g: Co--ittees 4 <r. Bo+ies o/ -anage-ents. h: #yn+icates. i: Case Disc*ssion. 3: 7nci+ent Process. %: Role Playing. l: #ensiti.ity 5raining. -: Manage-ent / B*siness Ga-es. n: 7n$Bas%et e8ercise. o: 5ransactional ,nalysis. 1' W$AT IS PER!ORMANCE APPRAISAL+ APerformance appraisal (PA) is the process through which an indi(idual employee9s beha(ior and accomplishments for a fi:ed time period are measured 4 e(aluated. B 5he -ain 2*r2ose o/ -eas*ring an+ e.al*ating is to assess the 1orth or .al*e. 18. PER !RMA"#E APPRAI$AL. Is s%stematic & o'(ecti)e *a% of (+,ging t-e relati)e *ort- of an emplo%ee in performing -is tas./ Per/or-ance a22raisal is th*s the 2rocess o/ re.ie1ing an in+i.i+*alBs 2er/or-ance an+ 2rogra-, in a 3ob an+ assessing his 2otential /or /*t*re i-2ro.e-ent. 7t is a syste-atic -etho+ o/ obtaining, analyzing an+ recor+ing in/or-ation abo*t a 2erson that is nee+e+9$ a: ?or the e//icient Mgt o/ B*siness / >rg. i.

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b: By the -anager to hel2 hi- to i-2ro.e the 3obhol+ers 2er/or-ance 4 2lan his career. c: By the 3obhol+er to assist hi- to e.al*ate his o1n 2er/or-ance 4 +e.elo2 hi-sel/. 1'. PA- !ROM AN ORG PERSPECTIVE P, is le+ by the 2ersonnel /*nction. P, can be .ie1e+ as )$ste2 se6*ence as sho1n in ?ig$1. 5he se6*ence is signi/icant beca*se it begins 4 en+s 1ith the 2ersonnel /*nctions 4 is *lti-ately 3*sti/ie+ by the .al*e o/ P, in hel2ing to -a%e se.eral a+-inistrati.e +ecisions. 20. PA !ROM A MANAGERIALS VIEW POINT 5he -anager sho*l+ers the res2onsibility /or P,. 5he -anager +e/ines the +e-an+s o/ the e-2loyeeBs 2osition 4 translates these into so-e e82ectations /or the e-2loyees i.e., D7 e82ect yo* to re+*ce absentee s*- by 20H. Ho1 the e-2loyee act*ally 2er/or-ance is obser.e+ o.er a /i8e+ ti-e$2erio+ res*lting in a e.al*ation /or-. ;.al*ation -*st be share+ 1ith a s*bor+inate. 5he 2rocess en+s 1ith reco--en+ation /ro- yo* to Higher Manage-ent /or one or -ore a+-inistrati.e +ecisions regar+ing the e-2loyee as *n+er9$ i. Pro-otion. ii. #alary 7ncrease. iii. 5raining. i.. ,ny >ther.

21. PROBLEM O! VALIDIT& & RELIABILIT& P, is inten+e+ to e.al*ate the APer/or-ance 4 PotentialB o/ e-2loyees. #till they -ay not be .ali+ in+icator o/ 1hat they are inten+e+ to assess beca*se o/ a Iariety o/ Ci-itations on their *se9$ a: T-e 0alo1 effect. 5he ten+ency o/ the e.al*ation to base assess-ents o/ all the in+i.i+*al characteristics on the raterBs o.erall i-2ression o/ the 2erson being e.al*ate+ is AHalo ;//ectB. 5he halo e//ect is the ten+ency to generalize /ro- a 2re+eter-ine o.erall i-2ression /or the a22raisal o/ s2eci/ic traits an+ characteristics. i. -ias. ,22raisers Bias colors the entire a22raisal base on religion, 2olitical, social, inter2ersonal con/licts. ii. Inflation of .atings. 5here is a ten+ency to gi.e rater higher ratings. iii. /entral Tendency. 5en+ency to a.oi+ e8tre-e ratings on both en+s o/ scale. i.. 1trictness !rror. 0hen rater arti/icially assigns all or certain gro*2s o/ e-2loyee lo1 ratings.

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;;. MET$ODS O! APPRAISAL a: Global ;ssays 4 Ratings. b: 5rait$rating scales. c: Ran%ing Process. +: Critical 7nci+ent Metho+s. e: Beha.ioral base+ scales 4 B,R#. &n/ort*nately there are no acce2te+ stan+ar+s to +eter-ine 1hich -etho+ o/ e.al*ation 2ro+*ces best res*lts. , range o/ -etho+s 4 techni6*es are *se+. 5here are no co--only acce2te+ nor-s. a: 8lobal !ssay 4 .atings. 7n a ty2ical Global Rating a22roach the rater is as%e+ to 2ro.i+e an o.erall esti-ate o/ 2er/or-ance 1itho*t -a%ing +istinction a-ong 2er/or-ance +ecisions. D2-at is %o+r o)erall e)al+ation of t-is in,i)i,+al1s performance for t-e past %ear3J b: T.0IT-.0TI'8-1/0#!1. &s*ally co-2rise a list o/ 2ersonality$traits. Ko* as a rater 1ill be re6*ire+ to in+icate in a n*-erical scale the +egree to 1hich the in+i.i+*als being a22raise+ 2ossesses these traits. 5he trait rating a22roach is -*lti+i-ensional is *s*ally con+*cte+ to generate a li-ite+ n*-ber o/ traits a22earing in the P, /or-. Ho1e.er since they lac% s2eci/ic 3ob$relate+ +e/initions, tra+e rating scales are e8tre-ely .*lnerable to errors s*ch as halo, strictness, central ten+ency 4 that se.erally a//ect the .ali+ity 4 reliability o/ the ratings. c: .anking %rocess. 5o2 1H, 5o2!H, 5o2(H, Botto- !0H, -arginal 4 *nsatis/actory. +: /ritical Incident &ethods. Ko* -*st +oc*-ent the 2ositi.e 4 negati.e beha.ior e.ents that ha.e occ*rre+ +*ring a gi.en 2er/or-ance 2erio+. Ko* can re.ise 2er/or-ance as ser.ices o/ LIe an+ MIe beha.ior relate+ to a 3ob. 5his a22roach re6*ires a great +eal o/ in/erence on yo*r 2art as a rater to +eter-ine 1hich inci+ent are critical to the 3ob 2er/or-ance. e: -eha(iorally based scales 4 -0.1. Beha.iorally ,nchore+ Rating #cales FB,R#: are +escri2tion o/ .ario*s +egrees o/ beha.ior 1ith regar+ to a s2eci/ic 2er/or-ance +i-ension. 5he beha.ior s2eci/ically +e/ines an+ 2ro.i+es yo* the anchors /or the rating scales. ,ltho*gh these scales re2resents 3ob rele.ant +i-ensions o/ 2er/or-ances, they still 2age 2roble-s /or yo* in +eter-ining 1hich act*ally obser.e+ beha.ior -atch 1ith s2eci/ically anchore+ 2er/or-ance scales. Des2ite this, B,R# are a signi/icant i-2ro.e-ent, since they re6*ire less in/erence on yo*r 2art as a rater than tra+itional trait$rating a22roach. /: $bjecti(e 4 8oal-setting %rocedure. 5here /oc*s on o*tco-es. ,n e-2loyee is assesse+ on the basis o/ 1hat he 2ro+*ces as a res*lt o/ 3ob$2er/or-ance. Goals an+ stan+ar+ are set e.al*ation is base+ on 1hether the goal has been -et in relation to 2re+eter-ine+ stan+ar+s. ;<.&0=I'8 %0 &$.! !**!/TI"!. 7/ P, is to be -ore s*ccess/*l, they sho*l+9$ a: Base+ on 2er/or-ance stan+ar+s. b: Res*lt in a /ace$to$/ace 2er/or-ance re.ie1 an+ c: Base+ *2on -*lti2le assign-ents a:Res+lts !riente, $c-eme. 5hese e-bo+y the 2rinci2le +e.elo2e+ by DMC Gregory 4 the MB> 2hiloso2hy base+ on Peter Dr*c%erBs 1ritings. #ho*l+ be shi/te+ /ro- a22raisal to analysis MC Gregor s*ggeste+ that the e-2hasis. #ho*l+ be shi/te+ /ro- a22raisal to analysis. 5his i-2lies a -ore LIe a22roach. 5he s*bor+inate is no longer being e8a-ine+ by the s*2er.isor to +eter-ine the /or-ers 1ea%ness b*t the s*bor+inate is analyzing hi-sel/$his 1ea%ness, strategies an+ 2otentials. He beco-es an acti.e not 2assi.e agent. 5he ai- is to relate assess-ents to a re.ie1 o/ 2er/or-ance against s2eci/ic training an+ stan+ar+ o/ 2er/or-ance agree+ 3ointly by the s*2er.isor 4 s*bor+inate.

#*bor+inates -a%e his o1n e.al*ation. >nce 3ob a -anager is shi/te+ /ro- criticizing the s*bor+inate to hel2ing hi- i-2ro.e his 2er/or-ance. iii. 7t is consistent 1ith the belie/ that 2eo2le 1or% better 1hen they ha.e +e/inite 7 3obs they -*st -eet in s2eci/ie+ 2erio+. PER!ORMANCE REVIEWS. Meaning/*l e8ercise in a22raisal o/ 2otential the 2*r2ose o/ Per/or-ance Re.ie1 i/ they are to achie.e their 2ri-e 2*r2ose o/ hel2ing 2eo2le to i-2ro.e an+ +e.elo2. &nless care/*lly 4 sensiti.ely han+le+, yo*r s*bor+inates beco-e -ore +issatis/ie+ a/ter yo*r co*nseling than they 1ere be/ore. i. POTENTIAL REVIEWS , -eaning/*l e8ercise in a22raisal sho*l+ incl*+e a re.ie1 an+ a22raisal 2otential. 5he re.ie1 o/ 2otential is concerne+ 1ith /orecasting the +irection in 1hich the s*bor+inateBs career can 4 sho*l+ go an+ the rate at 1hich he is e82ecte+ to +e.elo2. 5he assess-ent o/ 2otential re6*ires an analysis o/ e8isting s%ills, 6*alities an+ ho1 they can be +e.elo2e+ to the -*t*al a+.antage o/ the co-2any an+ the e-2loyee. 5here is also an i-2ortant co*nseling as2ect to the re.ie1 o/ 2otential 1hich consists o/ +isc*ssion 1ith the in+i.i+*al abo*t his as2irations an+ ho1 these can be best -atche+ to the /*t*re, increase /or hi-. 5hese +isc*ssions are a .ital 2art o/ the 2roce+*re beca*se they can 2ro.i+e yo* 1ith in/or-ation abo*t yo*r e-2loyeeBs /eelings on the s*b3ect 1hich -ay ha.e a +irect i-2act or 2lans /or +e.elo2-ent. 2". USING MULTIPLE APPRAISALS 5o re+*ce the 2roble- o/ .ali+ity 4 Reliability, it -ay be -ore *se/*l to *se -*lti2le ratings than single e.al*ation. 0hile the rating o/ one s*2er.isor -ay not be .ali+, the o.erall 2atterns o/ se.eral ratings +o 2ro.i+e an in+ication o/ o.erall 2er/or-ance an+ 2otential /or +e.elo2-ent. 2(. PEER. Ratings, sel/$ratings an+ s*bor+inate ratings are .ario*s atte-2ts that ha.e been -a+e recently to i-2ro.e the P, syste-s. JOB DESCRIPTION- ANAL&SIS & EVALUATION 2). ,ob escription. 4o'5Description is a 'roa, statement of t-e p+rpose6 ,+ties & responsi'ilities of a (o' or position. A (o' ,escription s-o+l, 'e 'ase, on a ,etaile, job analysis. 27. ,ob 0nalysis. 4o' anal%sis refers to t-e process of e7amining a (o' to i,entif% its component parts an, circ+mstances in *-ic- it is performe,. 5he central concern is to treat 3obs as *nits o/ org. 5he 2*r2ose is to gather, analyze an+ *tilize in/or-ation abo*t 3obs. <ob analysis is the /o*n+ation /or 3ob e.al*ation. 2 . ,ob e(aluation and %ay structure. 4o' e)al+ation is t-e process of esta'lis-ing t-e )al+e of (o's in a (o' -ierarc-%. <ob .al*es -ay be +eter-ine+ by negotiation or /i8e+ on the basis o/ broa+ ass*-2tions abo*t -ar%et rates an+ internal relati.ities. <ob e.al*ation is a co-2arati.e 2rocess. 5hro*gh the 2rocess o/ 3ob e.al*ation one is able to co-2are 3obs by *sing co--on criteria to +e/ine the relationshi2 o/ one 3ob to another. 5his gi.es *s the basis /or gra+ing 3obs an+ +e.elo2ing a 2ay str*ct*re one has to re-e-ber that 3ob e.al*ation is abo*t relationshi2 an+ not absol*tes. 5here/ore 3ob e.al*ation cannot be the sole +eter-ining /actor /or +eci+ing 2ay str*ct*res. <obs ha.e intrinsic .al*e$the laborer is 1orthy o/ his hire. 0hat is the .al*e in -onetary ter-s *nless 1e ta%e into acco*nt a) T-e press+re of $+pplies & Deman, ') Internal Differentials c) feelings of e8+it%/ 2' !ACTOR A!!ECTING JOB VALUES a: Mar%et rates. b: =egotiate+ Pay #cales. c: 7nternal Di//erentials. +: ;6*ity. i: Mar.et Rates. , 3ob is 1orth 1hat the -ar%et says it is 1orth. Ko* 1ill ha.e +i//ic*lty in obtaining or retaining 2eo2le i/ their 2ay are not %e2t in line 1ith those 2re.ailing in the local 4 =ational labo*r -ar%ets /ro- 1hich yo* recr*it yo*r e-2loyees. #o-e s2ecialize+ 3obs 1ithin the co-2any 1ill be go.erne+ -ore by internal than e8ternal

MeC059:i. ii.

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co-2arison. Mar%et rates 2ro.i+e +ata on +i//erentials bet1een 3obs as 1ell as act*al le.els 2ay. ii: "egotiate, Pa% $cale. Many 2ay str*ct*res are b*ilt aro*n+ 2ay scales negotiate+ either at 2lant / =ational le.els. 5he negotiate+ rates 1ill be in/l*ence+ by -ar%et ratesN the relati.e stan+ar+s o/ e-2loyees o/ *nions, the econo-ic sit, legislation 4 go.t anti$in/lationary 2ay reg*lations. >/ten one 2ays -ore than the locally or nationally negotiate+ -ini-*- 3*st to %ee2 ahea+ o/ -ar%et rates or in res2onse to *nion 2ress*res. iii: Internal Relati)ities & E8+it%. Pay str*ct*res are e82ecte+ to re/lect +i//erences in the relati.e s%ill an+ res2onsibility o/ 3obs. 5hey sho*l+ ai- to achie.e e6*ity in the sense that in+i.i+*als sho*l+ /eel that their re1ar+s are in balance both 1ith their o1n o*t2*t in the sha2e o/ e//orts, s%ills an+ contrib*tion, an+ 1ith the re1ar+s recei.e+ by others in relation to their o*t2*t. i.: E8+it% is the /eeling that 3*stice 4 /airness are only achie.e+ 1hen e6*al 2ay is recei.e+ /or e6*al 1or%, 1hen 2ay +i//erentials can be relate+ to /inite +i//erences in +egrees o/ res2onsibility, an+ 1hen 2ay -atches in+i.i+*al ca2acity an+ the le.el o/ 1or% carrie+ o*t. 2(. <ob e.al*ation is *se+ to create 50> Di-ensions o/ relationshi2s. 5he /irst is .ertical relationshi2 1ithin the sector o/ an org 1here the basic s%ill is si-ilar. Here the or+er o/ seniority -ay be ob.io*s b*t the s2acing o/ the r*ngs on the seniority lea+er nee+s to be establishe+. 5he secon+ +i-ension is lateral relationshi2 bet1een 3obs o/ a +i//erent nat*re. <ob e.al*ation is there/ore basically the atte-2t to /in+ a -eas*re by 1hich the relati.e 2ay-ents -a+e to +i//erent 3obs are internally consistent. SUMMAR& ,n *n+erstan+ing o/ all the conce2ts in this *nit 1ill i-2ro.e the ability to *n+erstan+ 1hat -oti.ates -en an+ i-2ro.e o*r ability to -anage the- -ore e//ecti.ely. 2). MET$ODS O! JOB EVALUATION 1. Ran%ing Metho+. 2. Classi/ication. !. ?actor Co-2arison. ". Point Metho+. a: Ran.ing Met-o,. Ran%ing Metho+ re6*ires a co--ittee ty2ically co-2ose+ o/ both -anage-ent an+ e-2loyee re2resentati.es to arrange 3obs in a si-2le 1or% or+er, /ro- highest to lo1est. 2 3obs are co-2are+ an+ it is 3*+ge+ as to 1hich one is -ore i-2ortant / +i//ic*lt. 5hen they co-2are another 3ob 1ith the /irst t1o an+ so on *ntil all the 3obs ha.e been e.al*ate+ an+ ran%e+. Diffic+lties5 i. Ho1 +o yo* ran% h*n+re+s 4 tho*san+s o/ 3obsJ ii. ii: =o ob3ecti.ity in stan+ar+s o/ 3*+ging t1o 3obs. b: #lassifications Met-o,5 Classi/ication gra+e are establishe+ by i+enti/ying so-e co--on +eno-inator$s%ills, %no1le+ge, res2onsibilities$1ith the +esire+ goal being the creation o/ a n*-ber o/ +istinct classes or gra+es o/ 3obs. ;8a-2les M sho2 3obs, clerical 3obs or gra+e o/ 3obs, +e2en+ing on the ty2e o/ 3obs in the org once classi/ications are establishe+, they are ran%e+ in an o.erall or+er o/ i-2ortance accor+ing to the criteria chosen an+ each 3ob is 2lace+ in its a22ro2riate classi/ications. 5he classi/ication -etho+ shares -ost o/ the +isa+.antages o/ the ran%ing a22roach, 2l*s the +i//ic*lty o/ 1riting classi/ication +escri2tion 3*+ging 1hich 3obs go 1here. c: A#T!R #!MPARI$!" MET0!D. 5his is a so2histicate+ an+ 6*antitati.e ran%ing -etho+. 5he e.al*ators select %ey 3obs in the org as stan+ar+s. 5hese 3obs chosen sho*l+ be 1ell %no1n, 1ith establish 2ay rates in the co--*nity an+ they sho*l+ consist o/ a cross$section o/ all 3obs that are being e.al*ate+ D/ro- the lo1est to the highest 2ai+ 3ob, /ro- the -ost i-2ortant to the least i-2ortant an+ co.er the /*ll range o/ re6*ire-ents o/ each /actor, as agree+ *2on by a co--ittee re2resenting

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1or%ers 4 -anage-ent. D5y2ically 10$2( %ey 3obs are selecte+ by the co--itteeE. 0hat /actors in the %ey 3obs 1ill the other 3obs are co-2are+ againstJ 5hese criteria are *s*ally -ental re6*ire-ents, s%ill re6*ire-ents, 2hysical re6*ire-ents, res2onsibility 4 1or%ing con+itions. >nce the %ey 3obs are ta%en 4 criteria chosen, co--ittee -e-bers ran% the %ey 3obs on the criteria. 7n the ne8t ste2, the co--ittee -e-bers agrees *2on the base rate /or each o/ the %ey 3obs 4 then allocate this base rate a-ong the ( criteria. 5he /inal ste2 is to co-2are its o.erall 3*+g-ents an+ resol.e any +iscre2ancies. 5he syste- is in 2lace 1hen the allocations to the %ey 3obs are clear 4 *n+erstoo+, an+ high agree-ent has been achie.e+ in co--ittees -e-bers 3*+g-ents abo*t hi- -*ch o/ each criteria e.ery 3ob has. Dra*'ac.s5 i: Co-2le8ity. ii: &se o/ sa-e ( criteria to assess all 3obs 1hen in /act 3obs +i//er across an+ 1ithin organization. iii: P!I"T MET0!D. 5his -etho+ brea%s +o1n chosen 3obs base+ on .ario*s i+enti/iable criteria$s*ch as s%ill, e//orts, an+ res2onsibility an+ then allocates 2oints to each o/ these criteria. De2en+ing *2on the i-2ortance o/ each criteria to 2er/or-ing the 3ob a22ro2riate 1eightage are gi.en 2oints are s*--e+, an+ 3obs 1ith si-ilar 2oints totals are 2lace+ in si-ilar 2ay gra+es. &erits. 5he 2oint -etho+ o//ers the greatest stability o/ the /o*r a22roaches. <obs -ay change o.er ti-e b*t the rating scales establish *n+er the 2oint -etho+ stay intact. ,lso there is a -ini-*- o/ rating errors. Demerits. i. Co-2le8. ii. Costly 4 ti-e cons*-ing to +e.elo2. 5he 2oint -etho+ is the -ost 1i+ely *se+ -etho+. 27. Esta'lis- Pa% $tr+ct+re. >nce the 3ob e.al*ation is co-2lete, its +ata beco-e the n*cle*s /or the +e.elo2-ent o/ the org 2ay str*ct*re. 5his -eans establish 2ay rates or ranges that are co-2atible 1ith the ran%s, classi/ications, or 2oints arri.e+ at thro*gh 3ob e.al*ation. a: 0age #*r.eys. Most org *se s*r.eys to gather /act*al in/or-ation on 2ay 2ractices 1ithin s2eci/ic co--*nities an+ a-ong /ir-s in their in+*stry. 5his in/or-ation is *se+ /or co-2arison 2*r2oses. 7t can tell -anage-ent i/ the org 1ages are in line 1ith those o/ other e-2loyees an+ in cases 1here there is a short s*22ly o/ in+i.i+*als to /ill certain 2osition -ay be *se+ to acti.ely set 1age le.els. >rg obtain +ata by carrying o*t its o1n s*r.eys 4 ta22ing in/or-ation /ro- >'ational -ureau of labor statistics.9 b: 0age c*r.es. 0hen -anage-ent arri.es at 2oint totals /ro- 3ob e.al*ation an+ obtains s*r.ey +ata on 1hat co-2arable org are 2aying /or si-ilar 3obs then a 1age c*r.e can be /itte+ on to the +ata. 5his e8a-2le ass*-es *sage o/ the 2oint -etho+ an+ 2lots 2oint totals an+ 1age +ata. , se2arate 1age c*r.e can be constr*cte+ base+ on s*r.ey +ata 4 co-2are+ /or +iscre2ancies.

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c: ?age structure. 7t is only a short ste2 /ro- 2lotting a 1age c*r.e to +e.elo2ing the org 1age str*ct*re. <obs that are si-ilar in ter-s o/ classes, gra+es or 2oints are gro*2e+ together. ?or e8a-2le Pay Gra+e$1 -ay co.er /ro- 0 to 100 2oints, Pay Gra+e$2 /ro- 101 to 200 2oints 4 so on. 5he res*lt is i-2ortant 3obs are 2ai+ -ore an+ as in+i.i+*als ass*-e 3obs o/ greater i-2ortance they rise 1ithin the 1age hierarchy. ;ach 2ay gra+e has a long range an+ that the ranges o(erlap. INCENTIVE COMPENSATION PLANS 7ncenti.e 2ay is gi.en in a++ition to basic 2ay an+ 2ro.i+es a++itional +i-ension to the 1age str*ct*re. a) In,i)i,+als Incenti)es. aa: Piece 1or% 2lanBs ab: 5i-e sa.ings bon*ses. ac: Co--issions. 7n+i.i+*alBs incenti.es are 1i+es2rea+ in 2ractice. +: Gro+p Incenti)es. 51o or -ore e-2loyees can be 2ai+ incenti.es /or co-bine+ 2er/or-ance e8a-2le$ tea- .ictories. e: !rg *i,e incenti)es. 5he goal o/ s*ch incenti.e is to +irect the e//orts o/ all e-2loyees to1ar+s achie.ing o.erall org e//ecti.eness. 5his 2ro+*ces re1ar+e+ /or all e-2loyees base+ on org 1i+e cost re+*ction. ;8a-2le &# #canlon 2lan$ labor sa.ing i-2ro.e-ents 2ro3ect sharing 2lans. /: ;O;C&57I; C>MP;=#,57>=#. ;8ec*ti.e 2ay has se.eral t1ists that +eser.e attention. ?irstly, Base salaries o/ e8ec*ti.e are high. #econ+ly, e8ec*ti.e o2erate *n+er Bon*s 4 stoc% o2tion 2lans that can +ra-atically increase their total co-2ensation. 5hir+ly, e8ec*ti.e recei.e 2er6*isites or s2ecial bene/its. /$'/#21I$' Co-2ensation a+-inistration is 2art o/ e.ery org. 5he syste- -*st be tailore+ to -eet the ob3ecti.es 4 nee+s o/ the co-2any.

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SEL! REVIEW *UESTIONS @1. #tate .ery brie/ly the +isting*ishing /eat*res o/ A<ob ,nalysisB, <ob Descri2tion, an+ <ob e.al*ationJ @2. Describe the -a3or ste2 o/ <ob +escri2tionsJ @!. 0hat is co-2ensation a+-inistrationJ 0hat +oes it entailJ @". Di//erentiate bet1een 1age s*r.ey, 1age c*r.es 4 1age str*ct*resJ CASE APPLICATION GPER,-UPH 1. Cast year an+ in ! o/ the ( 2rece+ing years A1mithson Industries9 lost -illions o/ +ollars. ,ltho*gh a large conglo-erate, s-ithsion has /o*n+ these losses har+ to acce2t a so*ght to /reeze 1age increases /or its e8ec*ti.e. Ho1e.er a/ter con/erring 1ith the 2resi+ent o/ the co-2any the chair-an o/ the boar+ has +eci+e+ to o//er non$/inancial incenti.es. His reasoning 1as that co-2etition 1as hea+$h*nting, an+ to -a%e s*ch a blatant no$increases state-ent -ight ca*se the -ore$2ro-ising e8ec*ti.es to lea.e the org. 5his he /elt, 1o*l+ be e8tre-ely +eter-ental. He belie.e+ that 1hen ti-es 1ere to*gh, as they ha+ been, i.e. 1hen e8cellent -anagers are re6*ire+. Cosing the- no1 co*l+ only sno1ball the +ecline. ,ccor+ingly, the Boar+ o/ Directors has .ote+ to 2ro.i+e each e8ec*ti.e 1ith a -e-bershi2 in the local health #2a, 1hile consi+ere+ a 2er-anent 2er% an+ in lie* o/ a raise this year, the boar+ rationalize+ that -anaging the cor2oration the -onths ahea+ 1o*l+ be e8tre-ely stress/*l an+ that this -e-bershi2 1o*l+ be a -eans o/ re+*cing the stress 1hile enabling the e8ec*ti.es to beco-e healthier. &n/ort*nately, ho1e.er the 2er% 1as =>5 eno*gh. Gr*-bling abo*t the chain o/ e.ents t1o e8ec*ti.es A jumped ship.9 5he oneBs that staye+ +i+ so beca*se o/ their ti-e in.este+ in the co-2aniesB 2ension. Ho1e.er they too 1ere *2set o.er the boar+s +ecision. *UESTIONS @1$ Ho1 co*l+ this APer%B ha.e been o//ere+ or -ar%ete+ better to these e8ec*ti.esJ @2$ 0hat +o yo* belie.e is the reason 1hy -ost o/ the e8ec*ti.es +i+ not /in+ the Per% re1ar+ingJ @!$ ?ace+ 1ith a si-ilar +ile--a, 1hat yo* ha.e +one i/ yo* ha+ been chair-an o/ the Boar+J 0hat 1o*l+ yo* +o no1 that the e8ec*ti.e are *2setJ