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Report On Appraisals Of Red Square Industries Management Essay

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With the development of the Red Square Industries, a matter of human resources has
appeared recently. A forced ranking distribution (listed in table 1) is used by Red Square
Industries to assess employees, whose salary increases are based on their "title".
Employees, however, quickly learn these different levels and what level others stand
although the industry does mean to be confidential. The situation is becoming
increasingly terrible because even the managers think it is difficult to continue to
manage the company. As time goes by, the performance appraisal program has become
regarded more as an HR exercise.
As a role of a HR professional, here comes out some analysis about the current issues
and give out some recommondations according to some academic materials.

The performance appraisal system of Red Square

Employees in the industry are labeled with
different levels and titles
It is important and necessary for managers to have a particular reward strategy to direct
the organization to set up a programme which can make sure that the employees with
great outcomes and achievement will be rewarded. A suitable rewarding system can
motivate the employees and then create more profit for the company, which should be
based on an appropriate performance appraisal system. (Michael Armstrong, 2002),

It is indeed a good choice to distribut the employees into different levels according to
their own knowledge, experience and ability, because it is far easier for the managers to
manage the company and arrange the suitable workforce to different positions under

this situation. However, a forced ranking distribution will affect the later work
arrangement and performance because employee's performance may change after going
on their own duties and jobs. Some people who rated 1 (regarded as the superior
performancers) will try to slack off their jobs even though they are really with a store of
knowledge and rich experience; some people who rated 4 and 5 (regarded as
unsatisfactory performancers) will not have enough opportunities to perform well
because the so called rated 1 or 2 employees who are regarded as hotshots and will be
asked to solve significant problems. The five different "titles" are listed in table1 below:
Table1: the five-level performance appraisal system
Salary increase
Legally required increases
Superiro performers
(Top 10%)

Good performers
(The next 25%)

Acceptable performers
(The next 45%)

Marginal performers
(The next 15%)

Unsatisfactory performers
(The bottom 5%)

Problems caused by this appraisal system
First, non-cooperative attitude will arise in "level-1 group". People in level-1 group,
called "stars", may consider that one or some other star employees are incapable to
stand in their goroup, they may refuse to communicate and cooperate. So they may fail

to finish assignment and even strike, which results in an irreversible disaster to the
industries. The industries can not take the losses when the people regarded as the top
staff of the company can not do the job effectively.
Second, employees rated 3 will loss their motivation when they learn that they are only
average. What is more? At this time, employees rated 2 will try to quit the job because of
the industry's attitude----let the hotshots solve the problems. Those graded as "dogs",
therefore, become the major workforce of this industry. Employees who are rated 5 who
belong to a union are favourite by managers, inspite that the company denies, even the
people in this group are non-performing. This becomes a vicious circle and the
managers are reluctant to them.
Third, there also exists a major problem in the distinction of employees rated 3 and 4.
Although clarified in the appraisal record, the boundary is not easy to mark. Some
people rated 4 because they are new but they have good learning ability, but some
people rated 3 because they have been trained but are still not capable for the job. So the
coompany will loss many forces in these two groups.

Causes of these problems

Firstly, when the industry recruites, they may ignore to test the employee to check if
they fit in this job. The industry should make sure what kind of laborforce they need
before introducing new people. If the company does not do well in this field, and their
decisions turn out to be wrong, the candidates may be put in wrong position. The people
who suppose to perform well and outstanding but actually make little contribution to
the industries may be hired. However, others who are predicted to do limited work but
actually can have great achievement will be refused to be enrolled or only have a chance
to work as casual laborers. The loss will be disasterous and irreversible. Therefore,
employers should focus on some personalitier, such as loyalty, communication ability
and leadership. (Susan Jackson, et al., 2006),
Secondly, managers do not pay enough attention to the laws, which will help to cement
the employee-employer relationship as well as protect employees. As many acts are
designed and passed to protect employees, the employment laws have force of law in
various processes of recruitment and relationships between employees and employers
although the employment law is a fragmented work in progress in some areas. It is no

possible that the law will cover every possible case in the industry, but it does not mean
that the managers can do what they want. What the employers can do is to learn the
rules of law and follow them even the employment law is changing occasionally.
Thirdly, who has right to decide whether to hire or lay off a staff? The manager or the
HR? As Purcell et al (2003) claimed, "There is a need for HR policies to be designed for
and focused on front line managers", on the other words, the HR should have more
responsibility for implementing the policy, while the managers have priority and finally
decide about people. But the performance appraisal program will creat too much ill and
unfair over time, the HR department now should try to set up a new and complete
system to solve this problem. If the employees and employers can not cooperate well, it
is not easy to find suitable person to do the particular job.

Some recommendations to Red Square Industries

After listing the problems faced by Red Square Industries and analysing the problems, it
is necessary to give out some affirmative measures to solve these problems. In this case,
many things should be improved, such as the performance appraisal system, the
recruitment principles and even the design of the jobs.

HR resources should pay more attention to the

laws involving employees.
In the 1960s and 1970s, laws and statutes were passed to protect the human resources
management behaviours in the world. To some extend, the the human resources
management has changed due to change of circumstances. The dual pressure of national
policy and the advance of workplace trade unionism and collective bargaining have
vitally affected its evolution. (John Bratton, 1999). Recently, the US Supreme Court
issued a ruling that involved in the employment discrimination law, employees of
different physical conditions, ages, genders and races should be regarded equally, even
though it is hard to do this as a whole, the industry should obey this as much as possible.
(Norma Riccucci & Stephen Condrey, 2010),
HR managers should pay more attention to the laws and statutes about the relationship
between employee and employer. Before hiring a new employee, the industry should

make sure that this people can do well in this position, or at least, after training, because
the employers need a valid reason for dismissal to demonstrate substantive. With the
comparatively improvement of legislation and standard system on the employment, and
a scepticism about the morality of leaders of industry, they may get caught in trouble
even have a contract.
In this case, the company gives the employees who are rated 4 and 5 only legally
required increases. On the other words, employment laws at least protest the right for
these people, but once these people are hired, it is hard to fire them even they are not
capatable to finish the task of this position. But there are some reasons for an
organization to summary dismissal, such as serious misconduct, physical abuse, bribery
and incompetence. Why would the company still hire them? It is possible that they
ignore some important details during employment which are listed following.

Giving candidates an ability testings before hiring

In order to solve the problems arise in unsatisfactory caused in different group, the HR
department should take some affirmative measures. When recruiting or training new
employees, the industry should use some academic approaches to reduce the
troublesome in the future. For example, use the Hackman & Oldham's Job
Characteristics Model to identity the quality of employees before giving them offer. This
Job Characteristics Model can justify the employees by using three different kinds of
elements: firstly, skill varity, task identity, task significance, through which they will
learn the meaningfulness of the work; secondly, autonomy will make them feel
responsibility to the outcomes; thirdly, feedback gives them knowledge of results.
Because people who have these characteristics are possible to do better in their position.
(Richard Daft & Dorothy Marcic, 2009).
In order to assess the quality of employees after a serious training, industry can also
consider some other important requirements, for the reason that learning capacity is
various among different people, such as knowledge, skills and abilities (KSAs), and even
some physical assessment. (Robert Gatewood, et al., 2008) The design of the question
and the evaluation form should be pratical rather than too ideal, the question and
method should not be too difficult and complicated for ordinary people to answer, on

the generalization that respondent will try to guess the answers and result in distortion
of the profiling.
In this case, if the managers or the HR managers can distribute the employees into
appropriate positons, a number of matters can be deterred in the following hiring. If the
assessment system can be ideal and most people can also their own interests as well
through this system, the managers will also allocate them into suitable fields. But this is
not the only significant thing the industries should do; also important is to redesign an
effective performance appraisal system to follow when the human resources
management is facing problems. (George Bohlander & Scott Snell, 2010).

Design an effective performance appraisal system

Performance appraisal can not be kept intact all the time. It should be regarded as a
process, because the situation of the industries is changing all the time. It is believed
that there exists an ideal cycle and if people followed, it will come out a superiro results.
Where does the cycle start? Some academic argument claim that it begins at the job
instead of some designed form. On the other words, first of all, the industry must ensure
what shoud be done and point out in what way it can be achieved. A typical philosophy
should be concerned when finding an effective appraisal system, that is the Classic
management by objectives (MBO) which aims at the long-term goals and strategic
plans. All the projects are desinged to develop general systematical targets.

According to (Dick Grote 1996), the cycle is consisted by a five-phase process, which
start with the company has set up its strategies and general instructions. The five phases
are listed below:
Performance Planning
At this stage, the appraiser and appraisee should reach an agreement on the
responsibility of the subordinate's task, some specific objectives, standards of
subordiantes' achievement, performance factors and the development plan the
employee should complete.
Performance Execution

After reaching an agreement in phase 1, the supervisor should consider the feedback and
fix the obsolescent plans as long as they meet a mature agreement. Only in this way can
the plan be completed well.
Performance Assessment
After finishing some plans, these two groups need assess the accomplishments of plans,
and decide what degree they achieve independently. Not only the subordinate should
submit the self-appraisal to the supervisor, but they can also read others'.
Performance Review
When reviewing others' appraisal, they should focus on some elements, such as final
achievement, action effectiveness, general behaviour evaluation and developing
progress and so on. As metioned previous, people should exchange the self-appraisal in
addition submit to supervisor.
Performance Renewal and Recontracting
As time goes by, some outdate rules are not appropriate any more. Industries should
update and make sure that they will fit to the changing environment. This phase comes
back to phase 1 and complete an ideal circle.

Have a job analysis to help HR managers to

develop job descriptions
Job analysis is significant because it can obtain necessary information about what is
needed in a job, such as duties, tasks or some special skills. A good job analysis can
supply the HR managers to develop a job description. In this case, if the managers can
figure out some particular elements in different positons, and summarize in written
form, the HR managers can recruit some more appropriate people, which will deter
many troublesome from the source. (R kleynhans, et al., 2006).
Job analysis should be updateed when some conditions changed, such as a new job
position is created and a job is changed significantly. The orginal job analysis may not
suit for current situation any more, so if the industry wants to relate the ability of the

employees to the compensation or salary increase, they should try to update job analysis
date to identify employee specifications. (David Walsh, 2007),
The job advertisment should describe cleary what kind of person they need; the job
description should include but not limite to: job title, qualifications, required
experience, and the person the occupant reports to etc. The organization can get the
person with appropriate quality when they describe the details clearly to the public.

A good performance appraisal system is a very important element and process in the
whole development of industry. Red Square Industries is facing a common problem that
many other industries, especially those trying to expand its size. The industries should
use academic and professional methods to solve these problems; also important is that
the employees and employers should cooperate when they are applying these methods.