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Establishing Performance Standards

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An effective system for reviewing performance must be based on clearly understood criteria. When these Standards are specific, it is easier for employees to judge their own performance and to set appropriate improvement goals. Naturally, Performance Standards make the Front Line leader’s job in providing feedback much easier as observations are based on criteria that the employee understands. 
Performance Standards are useful only if they are attainable, specific and area valid measure of the assigned responsibility. When establishing Performance Standards, the following four guidelines will prove useful: 

1. Be specific 

Ambiguous terms accomplish little in communicating what is expected of the employee in fulfilling his/her responsibilities. 


Avoid words such as:
 
Use Self Defining Terms: 
 Acceptable
With no more than 4 percent rejects 
 Adequately Within one day after receipt 
 Approximate By Tuesday 12 noon 
 Maximum No Later then the 15th of each month 
 As soon as possible According to instructions in our procedural manual 
 Carefully  
 Reasonable  
 Courteously  
 Desirable  


2. Set Standards 

Performance Standards should always be viewed within a normal range or, statistically, a bell curve. Some people will exceed the Standards, most will meet the Standards and some will fall short. 

If a Standard is unachievable, employees will tend to give up and perhaps perform less satisfactorily than if no standard had been set. If a Standard is too easily achieved; employees will not expend extra effort and the Standard will eventually have a negative effect on performance. 

As well as being specific and attainable, a Standard must differentiate between activity and accomplishment, focusing on the latter. It must also take into consideration those conditions that the employee cannot control. 

3. Set valid goals 

To expect an employee to make 75 telephone calls a day is not a valid Standard because it addresses the activity only. It is better to expect the employee to make 10 sales a day (the accomplishments) as a result of the telephone calls (the activity). Do not stipulate that an employee attend two seminars a year (the activity); rather, expect the employee to acquire and use specific skills related to current projects (the accomplishments). Likewise do not make the employee responsible for identifying cost-related problem areas. Instead, stipulate that the employee should hold costs down to three percent of the budget. 

4. Authority levels 

In its aim to sweep away the gray areas, management should make sure that levels of authority are clearly understood. A common cause of misunderstanding between an employee and Front Line leader is a lack of agreement on the employee’s authority. An employee who seems to lack initiative or who, alternatively, oversteps bounds may be confused as to the degree of authority he/she possesses. Authority levels should be clearly expressed. For example, employees with: 

• complete authority are expected to take action to carry out a key responsibility without consulting or reporting to the Front Line leader. 
• normal authority are expected to take action but to report the 
• action to the Front Line leader. 
• limited authority are expected to present their recommendations, 
• no authority will not be taken until a decision is reached by the Front Line leader or next-level manager. 

Each key area of responsibility should be examined to establish its level of authority. For instance, if performance is less than satisfactory, the Front Line leader should check to see if a misunderstanding concerning the employee’s level of authority has been a contributing factor. Similarly, it may be prudent to lower the degree of authority when unacceptable performance is a concern, thereby encouraging more frequent discussions between the Front Line leader and employee. The reverse is also an option when an employee is exceeding the establish Performance Standard. 

Your one-on-one discussion with an employee will be the most critical step in the Performance Appraisal and self-development process. 

The Goals of the discussion are to: 

• Clarify any misunderstanding or ambiguity concerning the employee’s role in meeting the job’s Performance Standards - within the parameters of the Values and Guiding Behaviours. 
• Set the tone as part of an ongoing and open relationship. 
• Act as a major motivational event. 
• Provide an opportunity to indicate, by your behaviour, the nature and depth of your concern for the employee.

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