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Write 3-4 page paper discussing the following: See attachment for instructions

·  Paper must include a cover page, abstract and 3-4 reference. Do not use Wikipedia.

·  All sources used must be cited both within the text and in a references section at the end of the lecture (use APA conventions for citing)

·  No plagiarism  

·  APA conventions for citing

Week 6 Discussion 1:

Performance and Compensation

This week, our focus will be on performance and compensation. This process can only be successful if managers and employees work together to set performance plans for the future. This week’s objective is to create a performance evaluation plan for the workplace. Have a great week!

Upon successful completion of this week’s lesson, you should be prepared to: 

· Create a performance evaluation plan for the workplace

Review this week’s Learning Resources, especially:

· W6 Lecture – Performance

(See attachment)

· Employment Performance –

· Understanding Compensation Management – YouTube

Mello, J. (2015). Strategic Human Resources Management (4th edition). South-Western, Cengage Learning ISBN: 9781285426792


Performance and Compensation

Write 3-4 page paper
discussing the following:

1. Explaining the benefits of employee involvement in performance evaluations and feedback.

1. How performance measures are tied to compensation?

1. 3 – 4 references Do not use Wikipedia.

1. APA citing

1. No plagiarism

1. All sources used must be cited both within the text and in a references section at the end of the lecture (use APA conventions for citing)

Performance and Compensation

Effective performance management systems require cooperation between employees and supervisors to set performance expectations; review results; assess organizational and individual needs, and plan for the future. Today’s streamlined organizations have fewer employees with broader job assignments and increased responsibility and accountability (Mello, 2105). Some organizations may have employees working in two positions due to budget constraints, or the human resources office may have a difficult time recruiting a well-qualified person.

In the mid-1950s, Maslow developed a theory regarding personal motivation. The five levels of Maslow‘s hierarchy of needs begins with the base consisting of most important physiological needs of air, food, and water and progresses to higher levels of esteem and self-actualization. One must meet lower level needs before one can progress to subsequently higher levels of needs, according to Maslow. With respect to management, a key point is that once an individual meets a need, that need no longer provides motivation (Maslow, 1954). When these needs are no longer met, to generate the best outcome for employees, managers implement performance evaluation plans that are used to as an evaluation tool used by supervisors to successfully develop employees and maximize organizational productivity. The plan should be implemented within 30 days of an employee being hired in a position. The supervisor meets with the employee, and based on the employee’s job description, a set of measures is developed. Performance evaluation tools set clear employee expectations, measure and align employee goals with organizational goals. The performance evaluation system is also a tool used to reward employee accomplishments when goals are met. Using various studies, researchers supported the idea that transformational, transactional, and laissez-faire leadership styles influence the morale of an organization’s workforce, which they directly link to profitability and success (Levine, 2004). Levine went on to say employee morale is an important element of organizational success, as it creates an environment where individuals enjoy coming to work. Satisfied employees perform better, resulting in higher performance and efficiency, which leads to profitability. Effective leaders need the same common traits as transformational and transactional leaders.

Feedback is a part of the performance evaluation system.


Traditionally, performance evaluation was performed by the employee’s immediate supervisor, who has first-hand knowledge of what the employee does on a daily basis. A variety of perceptual errors by supervisors can occur, including:

·       Halo effect – rater allows one positive or negative trait, outcome or consideration to influence other measures.

·       Stereotyping or personal bias – rater makes performance judgments based on characteristics of employee, not performance.

·       Contrast error – employee assessment is based on those being given to other employees.

·       Recency error – evaluation is biased toward events and behaviors immediately preceding the evaluation.

·       Central tendency error – evaluator avoids the higher and lower ends of performance assessment ratings.

·       Leniency or strictness error – employees are generally all rated well above or well below average (Mello, 2015).

·       Many managers have no true knowledge of the technical or other skills that a worker may have, or the ability to observe the employee and the means by which the employee accomplishes work. To avoid this, some manages require the employee to meet with them on a weekly basis to inform the managers of the tasks that were accomplished that week, or some may require a monthly meeting. Other individuals, such as peers, customers, subordinates, or others could provide insights into an employee’s performance. The employee could also provide self-assessment date. Multi-rater or 360 degree feedback uses some combination of assessments by various individuals. Example – Peer Assessment at Coffee & Power and Performance Management at Otis Elevator (Mello, 2015).


Organizations are incorporating 360 feedback reviews into performance appraisals to enhance relationships between managers and employees. The best cultural environments for 360 degree feedback are where members trust one another in an open system. Within this culture, covert operations do not determine success and people are genuine with opinions. Feedback is the “existence of nonlinear feedback in complex systems that allows for emergence, self-organization, adaptation, learning and many other key concepts that have become synonymous with complexity thinking” (Richardson, 2008, p.13). Constructive feedback is specific, timely, and delivered in a considerate tone (Baron, 1988). Employees identify constructive feedback as the preferable feedback method because constructive feedback encourages growth (Baron, 1988). Positive feedback behavior influences growth among organizational members, as members see the feedback as an opportunity to correct shortcomings (Baron, 1988).


Compensation is a key strategic area for organizations, impacting ability to attract applicants, as well as insure optimal performance levels from employees. Compensation programs continue to assume an increasingly larger share of organizational operating expenses, especially in service industries (Mello, 2015). Compensation is a systematic approach to providing monetary value to employees in exchange for work performed. Compensation may achieve several purposes assisting in recruitment, job performance, and job satisfaction (HR Guide, 2013).


Baron, R. (1988). Negative effects of destructive criticism: Impact on conflict, self-efficacy, and task performance. Journal of Applied Psychology, 73(2), 199-207. doi:10.1037/0021-9010.73.2.199

Maslow, A. H. (1954). Motivation and personality (1st ed.). New York, NY: Harper and Row

Mello, J.A. (2015). Strategic human resource management. (4th Ed). Cengage Learning

Richardson, K. (2008, June). Managing complex organizations: Complexity thinking and the science and art of management. Emergence: Complexity & Organization, 10(2), 13-26. Retrieved from Business Source Complete database.


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