Revita, Louise Ann I.

April 12, 2018

BS PSYCH 4 TTH 1:30-3:00 P604A

1. Performance Management Systems

 Performance management system is tool which is used to communicate the
organizational goal to the employees individually, allot individual accountability towards
that goal and tracking of the progress in the achievement of the goals assigned and
evaluating their individual performance. Performance management system reflects the
individual performance or the accomplishment of an employee, which evaluates and
keeps track of all the employees of the organization.
Disadvantages
1. Time Consuming
It is recommended that a manager spend about an hour per employee writing performance appraisals and
depending on the number of people being evaluated, it can take hours to write the department’s PA but
also hours meeting with staff to review the PA.
2. Discouragement
If the process is not a pleasant experience, it has the potential to discourage staff. The process needs to be
one of encouragement, positive reinforcement and a celebration of a year’s worth of accomplishments. It
is critical that managers document not only issues that need to be corrected, but also the positive things an
employee does throughout the course of a year, and both should be discussed during a PA.
3. Inconsistent Message
If a manager does not keep notes and accurate records of employee behavior, they may not be successful
in sending a consistent message to the employee. We all struggle with memory with as busy as we all are
so it is critical to document issues (both positive and negative) when it is fresh in our minds so we have it
to review with the employee at performance appraisal time.

4. Biases
It is difficult to keep biases out of the PA process and it takes a very structured, objective process and a
mature manager to remain unbiased through the process. Performance appraisal rater errors are common
for managers who assess performance so understanding natural biases is an important aspect to fair
evaluations.
Advantages
1. Performance Based Conversations
Most anyone who has managed people or been managed by someone has experienced the
sometimes stressful, time-consuming process of performance management. In theory I agree that
organizations that do not have strong performance management systems can have a negative
effect both on employees as well as their managers. However, a well-designed performance
management process can be rewarding for both the employee as well as the manager. Managers
 get busy with day-to-day responsibilities and often neglect the necessary interactions with staff
that provide the opportunity to coach and offer work related feedback.

A performance management process forces managers to discuss performance issues with employees. It is
this consistent coaching that affects changed behaviors and employee development.

2. Targeted Staff Development

All employees are on a development journey and it is the organization’s responsibility to be preparing
them for increased responsibility. If done well, an effective performance management system can help to
identify employee developmental opportunities and can be an important part of a succession planning
process.

3. Encouragement to Staff
Performance appraisals should be a celebration of all the wonderful things an employee does over the
course of a year and should be an encouragement to staff. There should be no surprises if issues are
addressed as they arise and not held until the annual review. The trick to positive appraisals is to focus as
much on what the employee is doing well while gently course correcting undesired behaviors.
4. Rewards Staff for a Job Well Done
When pay increases and/or bonuses are tied to the performance appraisal process, staff can see a direct
correlation between performance and financial rewards. This motivates and encourages employees to
perform at higher levels.

5. Under-performers Identified and Eliminated

As hard as we try, it is inevitable that some employees just won’t cut the mustard as they say. An
effective performance appraisal process can help identify and document underperformers, allowing for a
smooth transition if the relationship needs to be terminated.

2. Horns Effect
 a tendency to allow one's judgement of another person, esp. in a job interview, to be
unduly influenced by an unfavorable (horns) or favorable (halo) first impression based on
appearances.

3. Long versus short cycle

 Long Cycle Basics

Saying a sales cycle is long means different things in different industries. In a retail
environment, sales cycles are typically short because people come to the retail store to
 buy. However, in sales industries in which you have to call on prospects, the cycle can
take days, weeks, months or even years. In the commercial furniture industry, for
instance, months is a normal cycle time because you often sell furniture to new
companies as they await a building.

 Short Cycle Basics

As with a long cycle, the meaning of a short sales cycle can vary. In the aforementioned
commercial furniture sales business, a cycle of a few months is often considered short.
Ultimately, the key is the goal of a salesperson should be to minimize the cycle time as
much as possible without sacrificing on the rapport with the prospect. Shorter sales cycles
offer many business benefits as indicated by the common adage "time is money" in
selling.
Advantages
1. Cost savings
Outsourcing helps to reduce the non-revenue and office taxes generated by the organisation. A fully
functional and highly developed human resource department would require a large and developed
infrastructure and a large amount of skilled employees.

2. Efficiency
Maintaining an efficient and productive workplace is critical. Advanced human resource technology
developed by deployed individuals, employees and providers helps to focus on other human resource
functions such as payroll, benefit administration and acquiescence and consent management.
Disadvantages
1. Poor Performance
Many companies outsource to limit costs; however, decreased costs often result in decreased quality of
performance by the outsourced provider.
2. Distance
Outsourcing human resources functions to an offsite location often leads to a sense of distance between
the employees and the company. When the human resources department is not instantly accessible,
employees experience delays in communication, leading the employees to feel frustrated and unimportant
to the company.

4. BARS (Behaviorally Anchored Rating Scale)

 are designed to bring the benefits of both qualitative and quantitative data to the
employee appraisal process. BARS compare an individual’s performance against specific
examples of behaviour that are anchored to numerical ratings.
Advantages
 1. Focus is on desired behaviors
2. Scale is for each specific job
3. Desired behaviors are clearly outlined
Disadvantages
1. Time consuming to set up

5. BOS (Behavioral Observation Scale)

 A technique for evaluating the performance of an employee which can be used as part of
the appraisal process. Like behaviorally anchored rating scales, the BOS technique
involves a process of identifying the key tasks for a particular job, but the difference is
that employees are evaluated according to how frequently they exhibit the required
behavior for effective performance. The scores for each of these observed behaviors can
then be totaled to produce an overall performance score. In such instances, the various
measures of behavior are normally weighted to reflect the relative importance of the
measure to the overall job.
Advantages
1. They provide a structure for thinking through and planning the upcoming year and developing
employee goals.
2. They can motivate employees if supported by a good merit increase and compensation system.
3. This method is very useful and exactly.
Disadvantages
1. They are based on human assessment and are subject to rater errors and biases.
2. Can be a waste of time if not done appropriately.
3. They can create a very stressful environment for everyone involved

6. NPA (Non- Performing Asset)

 nonperforming asset (NPA) refers to a classification for loans on the books of financial
institutions that are in default or are in arrears on scheduled payments of principal or
interest. In most cases, debt is classified as nonperforming when loan payments have not
been made for a period of 90 days. While 90 days of nonpayment is the standard period
of time for debt to be categorized as nonperforming, the amount of elapsed time may be
shorter or longer depending on the terms and conditions set forth in each loan.
Advantages
1. The initiative will strike a fear in the hearts of promoters from defaulting as they might end up
losing their companies. Such promoters might start bringing in funds from their other ventures to
keep this company from slipping away.
2. Banks will be able to clean up their books rapidly and still hold on to the asset. Banks will move
the company from their lending books as loans get converted to equity. Such a conversion has
also been exempted from calculation of capital market exposure and will not attract mark-to-
market provisioning.
Disadvantages
1. Reduced Income
Interest Income is the first account that gets hit whenever an asset is declared nonperforming. Lending
companies such as banks are primarily in the business of earning income from interest paid by borrowers.
2. Unrecoverable Principal
The principal, or money used by banks to finance loans, comes largely from the bank's depositors. Banks
borrow the money deposited by account holders and loan it to their customers. It is imperative for the
bank to recover the money, because it's not the bank's money in the first place.
3. Negative Indicator
Nonperforming assets can be used as indicators of a lender's ability to manage its loan portfolio
efficiently. The efficiency of lending companies in recovering their principal and earning interest can be
measured by comparing their nonperforming assets ratio against those of peer companies. Dividing the
amount of nonperforming assets by the total gross loans will yield this ratio. A lending company's
efficiency rating deteriorates as the ratio increases.

7. Labor Code and PA

 Labor Code- The field of human resources management is greatly influenced and shaped
by the state and federal laws governing employment issues. Indeed, regulations and laws
govern all aspects of human resource management—recruitment, placement,
development, and compensation.
 Performance Assessment- also known as alternative or authentic assessment, is a form of
testing that requires students to perform a task rather than select an answer from a ready-
made list.
Advantage
1. They provide a document of employee performance over a specific period of time.
2. They provide a structure where a manager can meet and discuss performance with an employee.
3. They allow a manager the opportunity to provide the employee with feedback about their
performance and discuss how well the employee goals were accomplished.
4. They provide a structured process for an employee to clarify expectations and discuss issues with
their manager.
5. They provide a structure for thinking through and planning the upcoming year and developing
employee goals.
6. They can motivate employees if supported by a good merit increase and compensation system.
Disadvantages
1. They are based on human assessment and are subject to rater errors and biases.
2. Can be a waste of time if not done appropriately.
3. They can create a very stressful environment for everyone involved.
REFERENCES:
http://oxfordindex.oup.com/view/10.1093/oi/authority.20110803095456852
http://performance-appraisals.org/faq/bars.htm
http://smallbusiness.chron.com/disadvantages-nonperforming-assets-80378.html
https://content.wisestep.com/top-pros-cons-outsourcing-hr-services/