CHAPTER 6

APPRAISING AND REWARDING

PERFORMANCE
REWARD - something that is given in
return of ones service, effort, or
achievement.
Types of Rewards
Extrinsic Rewards - concrete rewards
that employee receive.
Intrinsic Rewards - tend to give
personal satisfaction to individual.
A COMPLETE REWARD PROGRAM
BASE PAY - Job analysis and wage
surveys rate jobs, comparing one
job with another to determine base
pay.
PERFORMANCE REWARDS - Is an
incentive to improve performance
on the job.
PROFIT SHARING - Motivates
workers toward teamwork to
improve an organizations
performance.
Other Payments:
Service Reward
Sacrifice Reward
Nonworking Reward
MONEY AS A MEANS OF REWARDING
EMPLOYEES
Money has social and status value.
Money satisfies many drives and
needs.
Money often has high valence.
High instrumentality is desired.
PERFORMANCE APPRAISAL - it is the
process of evaluating the performance of
employees, sharing that information with
them, and searching for ways to improve
their performance.
Management By Objectives (MBO)
is a personnel management technique
where managers and employees work

together to set, record and monitor goals

for a specific period of time.
Four steps of MBO:
1. Objective Setting - joint
determination by manager and
employee of appropriate levels of
future performance for the
employee, within the context of
overall unit goals and resources.
2. Action Planning - participated or
even independent planning by the
employee as to how to reach those
objective.
3. Periodic Reviews - joint
assessment of progress toward
objectives by manager and
employee, perform informally
sometimes spontaneously.
4. Annual Evaluation - more formal
assessment of success in achieving
the employee's annual objectives,
coupled with a renewal of the
planning cycle.
Appraisal Philosophy
1. Performance Orientation - it is
not enough to put forth effort; that
effort must result in the attainment
of desired outcomes (product or
services).
2. Focus on goals or objectives employees need to have a clear of
what they are supposed to be
doing and priorities among their
task.
3. Mutual goal setting between
supervisor and employee - this
is the belief that people work
harder for goals and objectives that
they have participated in setting.
4. Clarification of behavioral
expectations - this is often done
via a behaviorally anchored rating
scale (BARS), which provides the
employee and manager with
concrete examples of various levels
of behaviors.
5. Extensive feedback systems employees can fine-tune their
performance better if they know

what they are doing in the eyes of

the organization.