08 Chapter - Performance Management
Chapter 08
Performance Management
True / False Questions
1. The link between performance management and the organization's strategies and goals is
often neglected.
True False
2. A performance planning and evaluation (PPE) system is any system that seeks to tie the
formal performance appraisal process to the company's strategy by specifying at the
beginning of the evaluation period the types and level of performance that must be
accomplished in order to achieve the strategy.
True False
3. Managers are usually comfortable confronting employees with their performance
weaknesses.
True False
4. Validity refers to the consistency of a performance measure.
True False
5. The extent to which a performance management system seeks performance consistent with
the organization's strategy, goals, and culture is known as its acceptability.
True False
6. Acceptability is affected by the extent to which employees believe the performance
management system is consistent.
True False
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Chapter 08 - Performance Management
7. Multifaceted rankings require managers to rank employees within their departments from
highest performer to poorest performer.
True False
8. Comparative techniques of performance management virtually eliminate the problems of
leniency, central tendency, and strictness.
True False
9. Attribute-based performance methods are quite easy to develop and are generalizable
across a variety of jobs, strategies, and organizations.
True False
10. Behavior-based performance methods are the most popular performance evaluation
approaches in organizations.
True False
11. The critical incident technique is a behavioral approach to performance management.
True False
12. An advantage of behaviorally anchored rating scales is increased interrater reliability.
True False
13. A major disadvantage of assessment centers is that they do not provide a very objective
measure of an individual's performance at managerial tasks.
True False
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Chapter 08 - Performance Management
14. Result-based approaches to performance measurement assume that subjectivity can be
eliminated from the measurement process.
True False
15. Management by objectives (MBO) systems seldom link employee performance to an
organization's strategic goals.
True False
16. A disadvantage of the result-based approaches to performance measurement is that
individuals may focus only on aspects of their performance that are measured, neglecting
those that are not.
True False
17. The assumption of Pareto analysis is that the majority of problems are the result of a small
number of causes.
True False
18. The quality approach relies primarily on a combination of the attribute and results
approaches to performance measurement.
True False
19. The best use of self-ratings is for administrative purposes.
True False
20. Subordinates are the most frequently used source of performance information.
True False
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Chapter 08 - Performance Management
21. A major advantage of the 360-degree appraisal is that it provides a means for minimizing
bias in an otherwise subjective evaluation technique.
True False
22. Leniency reflects that a manager rates all employees in the middle of the rating scale.
True False
23. Appraisal politics refer to evaluators purposefully distorting a rating to achieve personal
or company goals.
True False
24. Once the expected performance has been defined and employees' performances have been
measured, it is necessary to feed that performance information back to the employees so that
they can correct any deficiencies.
True False
25. Output is a factor to consider in analyzing poor performance.
True False
Multiple Choice Questions
26. Performance planning and evaluation systems seek to tie the formal performance appraisal
process to the company's:
A. organizational structure.
B. stakeholders' needs.
C. strategies.
D. size.
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Chapter 08 - Performance Management
27. The process through which an organization gets information on how closely an
employee's actual performance met the performance plan is:
A. performance appraisal.
B. performance management.
C. performance feedback.
D. ability analysis.
28. Which of the following is NOT a purpose of performance management systems?
A. Administrative
B. Developmental
C. Investigative
D. Strategic
29. Which of the following is NOT a recommendation for developing an effective
performance management system?
A. Mirror the corporate culture and values.
B. Differentiate performance subjectively and effectively.
C. Adjust the system as required.
D. Communicate the total rewards system.
30. _____ emphasizes the need for the performance management system to guide employees
in contributing to the organization's success.
A. Specificity
B. Reliability
C. Validity
D. Strategic congruence
31. _____ are factors in a company's business strategy that give it a competitive edge.
A. MBOs
B. OBMs
C. KPIs
D. CSFs
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Chapter 08 - Performance Management
32. Which performance management evaluation criterion is concerned with maximizing the
overlap between actual job performance and the measure of job performance?
A. Reliability
B. Acceptability
C. Specificity
D. Validity
33. A(n) _____ measure evaluates irrelevant aspects of performance or aspects that are not job
related.
A. unreliable
B. valid
C. contaminated
D. inconsistent
34. A university that assesses its faculty members more on research work than teaching,
follows which performance management system?
A. Contaminated
B. Deficient
C. Unreliable
D. Inconsistent
35. The consistency among the different individuals who evaluate the employee's
performance is known as:
A. internal consistency reliability.
B. interrater reliability.
C. intrarater reliability.
D. test-retest reliability.
36. A measure that results in dramatically different ratings over time lacks:
A. internal consistency reliability.
B. interrater reliability.
C. intrarater reliability.
D. test-retest reliability.
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37. Which of the following statements about acceptability is incorrect?
A. Acceptability refers to the extent to which the performance measure assesses all of the
relevantand only the relevantaspects of performance.
B. Acceptability is affected by the extent to which employees believe the performance
management system is fair.
C. The three categories of perceived fairness include procedural fairness, interpersonal
fairness, and outcome fairness.
D. Research suggests that performance management systems that are perceived as unfair are
likely to be legally challenged, used incorrectly, and decrease employee motivation to
improve.
38. The extent to which the performance measure gives guidance to employees about what is
expected of them is called:
A. reliability.
B. validity.
C. specificity.
D. acceptability.
39. Which of the following is an inappropriate approach to measuring performance?
A. Comparative approach
B. Attribute approach
C. Consequential approach
D. Behavior approach
40. _____ ranking consists of a manager looking at a list of employees, deciding who the best
employee is, and crossing that person's name off the list. From the remaining names, the
manager decides who the worst employee is and crosses that name off the listand so forth.
A. Simple
B. Alternation
C. Reverse
D. Forced
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41. The technique that ranks employees into predetermined categories or groups according to
performance is called:
A. forced distribution.
B. high/low ranking system.
C. paired comparison.
D. strictness.
42. Companies that have clear goals and management criteria, train evaluators, use the
rankings along with other HR metrics, and reward good performance find the following
ranking technique useful.
A. Paired comparison
B. High/low ranking system
C. Forced distribution
D. Strictness
43. The _____ method requires managers to compare every employee with every other
employee in the work group, giving an employee a score of 1 every time he/she is considered
the high performer.
A. partner measurement
B. mixed-standard scales
C. forced distribution
D. paired comparison
44. Company XYZ is facing problems of and has to make administrative decisions of
promotions in order to address its requirement of more mid-level managers. Which
performance management approach should it follow?
A. Attribute approach
B. Comparative approach
C. Behavioral approach
D. Quality approach
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Chapter 08 - Performance Management
45. The approach to measure and manage performance that focuses on the extent to which
individuals possess desirable characteristics is called the:
A. attribute approach.
B. leadership approach.
C. personality approach.
D. performance approach.
46. Which attribute approach to performance management is the most frequently used?
A. Behaviorally anchored rating scales
B. Mixed standard scales
C. Behavior observation scales
D. Graphic rating scales
47. If a manager considers one employee at a time and circles a number or a word to signify
the degree to which that employee demonstrates a particular trait, he/she is using a:
A. critical incidents approach.
B. mixed standard scale.
C. behavior observation scale.
D. graphic rating scale.
48. In which performance technique are managers given three statements of performance per
dimension and asked to indicate whether the employee's performance is above (+), at (0), or
below (-) the statements?
A. Behaviorally anchored rating scale
B. Mixed-standard scale
C. Behavior observation scale
D. Graphic rating scale
49. Which of the following is TRUE of the attribute approach to performance management?
A. They result in high strategic congruence.
B. They are difficult to use.
C. They are generalizable across organizations and strategies.
D. They provide specific guidance and feedback to employees.
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50. This approach to performance management fails to provide any definite guidance on how
an employee can support the company's goals or correct performance deficiencies and also
elicits defensiveness from employees.
A. Quality approach
B. Comparative approach
C. Behavioral approach
D. Attribute approach
51. The performance management approach that requires managers to keep a record of
specific examples of effective and ineffective performance is called:
A. behaviorally anchored rating scales.
B. behavior observation scales.
C. critical incidents.
D. organizational behavior modification.
52. Which performance management technique involves the identification of a large number
of critical incidents, the classification of these incidents into performance dimensions, and the
rank ordering of these incidents into levels of performance?
A. Behaviorally anchored rating scales
B. Graphic rating scales
C. Comparative rating scales
D. Organizational behavior modification
53. The performance management method that requires managers to rate the frequency with
which the employee has exhibited a behavior during a rating period is the:
A. behaviorally anchored rating scale.
B. behavioral observation scale.
C. graphic rating scale.
D. organizational behavior modification.
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54. Managing the behavior of employees through a formal system of behavioral feedback and
reinforcement refers to:
A. behaviorally anchored rating scales.
B. behavior observation scales.
C. critical incidents.
D. .
55. Which of the following is a process where appraisers observe the individuals' behavior
and evaluate their skill or potential as managers for promotion decisions?
A. Productivity measurement and evaluation system
B. Management by objectives
C. Assessment centers
D. Organizational behavior modification
56. Which of the following is NOT true regarding behavioral approaches to performance
measurement?
A. They link strategy to specific behavior needed to implement strategy.
B. They provide specific guidance to employees regarding expected performance.
C. They result in techniques that have a high degree of validity.
D. The behavioral approach might be best suited to complex jobs.
57. In what type of system are annual goals established and passed down through the
organization?
A. Productivity measurement and evaluation system
B. Management by objectives
C. Assessment centers
D. Organizational behavior modification
58. Which of the following is generally NOT true of management by objectives?
A. Goals are usually established unilaterally by management.
B. Goals are specific, difficult, and objective in nature.
C. Individual goals are linked to the company's strategic goals.
D. Objective managerial feedback is provided to employees throughout the rating period.
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Chapter 08 - Performance Management
59. Which of the following is a means of measuring and feeding back productivity
information to personnel with the main goal of motivating employees to higher levels of
productivity?
A. Management by objectives
B. ProMES
C. Assessment centers
D. Critical incidents
60. Which of the following is NOT a step in the ProMES system?
A. People in the organization identify the set of activities or objectives the organization
expects to accomplish.
B. The staff defines indicators of the products.
C. Feedback is determined using rate of return.
D. The staff establishes the contingencies between the amount of the indicators and the level
of evaluation associated with that amount.
61. The _____ approach minimizes subjectivity, relying on objective, quantifiable indicators
of performance.
A. quality
B. comparative
C. results
D. attribute
62. A performance management system designed with a strong quality orientation can be
expected to do all of the following EXCEPT:
A. emphasize an assessment of both person and system factors in the measurement system.
B. emphasize that managers and employees work alone to solve performance problems.
C. involve both internal and external customers in setting standards and measuring
performance.
D. use multiple sources to evaluate person and system factors.
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63. Advocates of the quality approach believe that most U.S. companies' performance
management systems are incompatible with the quality philosophy for a number of reasons.
Which one of the following is NOT among these reasons?
A. Most existing systems measure performance in terms of quantity, not quality.
B. They involve both internal and external customers in setting standards and measuring
performance.
C. Companies do not share financial rewards of successes with employees.
D. Employees are held accountable for good or bad results to which they contribute but do not
completely control.
64. Quality advocates suggest that performance evaluations should do all but one of the
following. Name the exception.
A. Performance evaluations should include a discussion of the employee's career plans.
B. Two types of feedback should be provided: subjective and objective.
C. Employee performance evaluations should be linked to compensation.
D. The performance appraisal system should avoid providing an overall evaluation (rating) of
the employee.
65. Which of the following statistical process quality control techniques helps identify
redundancies in jobs that increase manufacturing or service time?
A. Cause-and-effect diagrams
B. Control charts
C. Pareto charts
D. Process-flow analysis
66. The quality control technique that lists causes of a problem in decreasing order of
importance is a:
A. cause-and-effect diagram.
B. control chart.
C. Pareto chart.
D. process-flow analysis.
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Chapter 08 - Performance Management
67. Which quality control technique is useful for understanding the amount of variance
between an outcome and the expected value or average outcome?
A. Control chart
B. Histogram
C. Cause-and-effect diagram
D. Process-flow analysis
68. Which quality control technique shows the relationship between two variables, events, or
different pieces of data?
A. Scattergram
B. Control chart
C. Pareto chart
D. Process-flow analysis
69. Identify the evaluation approach to performance measurement that meets the following
criteria: very high strategic congruence, usually high validity, high reliability, high
acceptability, and high specificity.
A. Comparative
B. Attribute
C. Behavioral
D. Results
70. Identify the approach to performance measurement that meets the following criteria: poor
strategic congruence, modest to possibly high validity, little to modest reliability, moderate
acceptability, and very low specificity.
A. Comparative
B. Attribute
C. Behavioral
D. Results
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71. Identify the approach to performance measurement that meets the following criteria: high
strategic congruence, usually high validity, usually high reliability, moderate acceptability,
and very high specificity.
A. Comparative
B. Attribute
C. Behavioral
D. Results
72. Identify the approach to performance measurement that meets the following criteria:
usually low strategic congruence, usually low attribute, usually low reliability, high
acceptability, and very low specificity.
A. Comparative
B. Attribute
C. Behavioral
D. Results
73. Which of the following is NOT true of managers as the source of performance measures?
A. Managers are the most frequently used source of performance information.
B. Managers are generally motivated to make accurate ratings.
C. Manager-based performance evaluations eliminate the concern of favoritism.
D. Managers are viewed by employees as legitimate sources of performance information.
74. Which of the following is NOT true of peers as the source of performance measures?
A. Peers have expert knowledge of job requirements.
B. Peer ratings are particularly useful for administrative and strategic decision making.
C. Peer ratings are particularly useful when supervisors do not have the opportunity to
observe employees.
D. Peers have been found to provide extremely valid assessments of performance in several
different settings.
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Chapter 08 - Performance Management
75. These sources of performance information are especially valuable when managers are
being evaluated and often have the best opportunity to evaluate how well a manager treats
employees.
A. Supervisors
B. Subordinates
C. Top-level management
D. Customers
76. Subordinates, as a source of performance information, are generally most appropriate
when the performance results are to be used for:
A. training purposes.
B. investigative purposes.
C. strategic purposes.
D. developmental purposes.
77. Managerial performance appraisal that involves subordinates' evaluations of the manager's
behavior or skills is:
A. upward feedback.
B. 360-degree feedback.
C. a traditional performance appraisal.
D. multi-rater feedback.
78. Using customer evaluations of employee performance is appropriate in all but one of the
following situations. Name the exception.
A. When the company wants an inexpensive means of evaluation.
B. When an employee's job requires direct service to the customer or linking the customer to
other services within the company.
C. When the company's strategic goal is to integrate marketing strategies with human resource
activities and policies.
D. When the company is interested in gathering information to determine what products or
services the customer wants.
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Chapter 08 - Performance Management
79. Which rater error is made when one judges those who are comparable to him/her in the
immediate work group higher than those who are not?
A. Contrast
B. Distributional error
C. Halo/horns
D. Similar to me
80. In a workgroup, a completely competent performer is working with a number of peers
who are outstanding. If the competent employee receives lower-than-deserved ratings because
of the outstanding colleagues, then which rater error has occurred?
A. Contrast
B. Distributional error
C. Halo/horns
D. Similar to me
81. Which rater error makes it difficult to distinguish among employees rated by the same
rater and creates problems in comparing the performance of individuals rated by different
raters?
A. Contrast
B. Distributional error
C. Halo/horns
D. Similar to me
82. If a student evaluating his/her professor at the end of term rates the professor low on all
performance criteria due to dissatisfaction with the professor's grading scale, the student has
likely committed which rater error?
A. Contrast
B. Halo
C. Central tendency
D. Horns
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Chapter 08 - Performance Management
83. Which rater error leads employees to believe that no aspects of their performance need
improvement?
A. Contrast
B. Halo
C. Horns
D. Similar to me
84. A situation in which evaluators purposefully distort a rating to achieve personal or
company goals is referred to as:
A. upward feedback.
B. downward feedback.
C. appraisal politics.
D. calibration politics.
85. What type of training attempts to emphasize the multidimensional nature of performance
and thoroughly familiarize raters with the actual content of various performance dimensions?
A. Performance training
B. Error reduction training
C. Multidimensional training
D. Rater accuracy training
86. _____ attended by managers provide a way to help ensure that performance is evaluated
consistently across managers and to reduce the influence of rating errors and politics on
appraisals.
A. Calibration meetings
B. Employee-review meetings
C. Multidimensional training
D. Rater accuracy training
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Chapter 08 - Performance Management
87. To improve the performance feedback process, managers should do all but one of the
following. Name the exception.
A. Give employees feedback frequently, not just during the feedback session.
B. Let employees rate their performance before the feedback session.
C. Conduct the feedback session in his/her office.
D. Focus on behavior or results, not on the person.
88. An employee that is performing at a barely acceptable level because of lack of ability
and/or motivation to perform well, not poor work conditions, is called a(n):
A. marginal employee.
B. inconsistent employee.
C. social loafer.
D. mediocre performer.
89. In what legal suit would the plaintiff allege that the performance measurement system
varies according to individuals?
A. Harassment suit
B. Reverse discrimination suit
C. Unjust dismissal suit
D. Discrimination suit
90. In what legal suit does the plaintiff claim that the termination was for reasons other than
those the employer claims?
A. Harassment suit
B. Reverse discrimination suit
C. Unjust dismissal suit
D. Discrimination suit
Essay Questions
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Chapter 08 - Performance Management
91. Discuss the three purposes of performance management systems and the degree to which
each purpose is being achieved.
92. What does the comparative approach do in terms of measuring performance? Discuss the
three techniques that fall under the comparative approach.
93. Discuss the process of developing behaviorally anchored rating scales. How do behavioral
observation scales (BOS) differ from behaviorally anchored rating scales?
94. What is an assessment center? What are the advantages of an assessment center?
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Chapter 08 - Performance Management
95. What are the three common components of a management by objectives (MBO) system?
96. What is the main goal of the Productivity Measurement and Evaluation System
(ProMES)? What are the four steps of ProMES?
97. What results can be expected from a performance management system designed with a
strong quality orientation?
98. Discuss the differences between the attribute and behavioral approaches to performance
measurement related to the criteria of (a) strategic congruence, (b) validity and (c) reliability.
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Chapter 08 - Performance Management
99. Discuss the various rater errors in performance management.
100. Discuss at least four ways to improve the performance feedback process.
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Chapter 08 - Performance Management
Chapter 08 Performance Management Answer Key
True / False Questions
1. (p. 353) The link between performance management and the organization's strategies and
goals is often neglected.
TRUE
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Easy
Learning Objective: 8-1
Topic: An Organizational Model of Performance Management
2. (p. 354) A performance planning and evaluation (PPE) system is any system that seeks to tie
the formal performance appraisal process to the company's strategy by specifying at the
beginning of the evaluation period the types and level of performance that must be
accomplished in order to achieve the strategy.
TRUE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-1
Topic: An Organizational Model of Performance Management
3. (p. 356) Managers are usually comfortable confronting employees with their performance
weaknesses.
FALSE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-2
Topic: Developmental Purpose
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Chapter 08 - Performance Management
4. (p. 361) Validity refers to the consistency of a performance measure.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-3
Topic: Validity
5. (p. 359) The extent to which a performance management system seeks performance consistent
with the organization's strategy, goals, and culture is known as its acceptability.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-3
Topic: Strategic Congruence
6. (p. 362) Acceptability is affected by the extent to which employees believe the performance
management system is consistent.
FALSE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-3
Topic: Acceptability
7. (p. 363) Multifaceted rankings require managers to rank employees within their departments
from highest performer to poorest performer.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Comparative Approach
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Chapter 08 - Performance Management
8. (p. 367) Comparative techniques of performance management virtually eliminate the problems
of leniency, central tendency, and strictness.
TRUE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-4
Topic: The Comparative Approach
9. (p. 370) Attribute-based performance methods are quite easy to develop and are generalizable
across a variety of jobs, strategies, and organizations.
TRUE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Attribute Approach
10. (p. 370) Behavior-based performance methods are the most popular performance evaluation
approaches in organizations.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
11. (p. 370) The critical incident technique is a behavioral approach to performance
management.
TRUE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-4
Topic: The Behavioral Approach
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Chapter 08 - Performance Management
12. (p. 371) An advantage of behaviorally anchored rating scales is increased interrater
reliability.
TRUE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
13. (p. 374) A major disadvantage of assessment centers is that they do not provide a very
objective measure of an individual's performance at managerial tasks.
FALSE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
14. (p. 375) Result-based approaches to performance measurement assume that subjectivity can
be eliminated from the measurement process.
TRUE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Results Approach
15. (p. 376) Management by objectives (MBO) systems seldom link employee performance to an
organization's strategic goals.
FALSE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Results Approach
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Chapter 08 - Performance Management
16. (p. 378) A disadvantage of the result-based approaches to performance measurement is that
individuals may focus only on aspects of their performance that are measured, neglecting
those that are not.
TRUE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Results Approach
17. (p. 380) The assumption of Pareto analysis is that the majority of problems are the result of a
small number of causes.
TRUE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-4
Topic: The Quality Approach
18. (p. 382) The quality approach relies primarily on a combination of the attribute and results
approaches to performance measurement.
TRUE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-5
Topic: The Quality Approach
19. (p. 387) The best use of self-ratings is for administrative purposes.
FALSE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-7
Topic: Self
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Chapter 08 - Performance Management
20. (p. 387) Subordinates are the most frequently used source of performance information.
FALSE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-7
Topic: Managers
21. (p. 388) A major advantage of the 360-degree appraisal is that it provides a means for
minimizing bias in an otherwise subjective evaluation technique.
TRUE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-7
Topic: Customers
22. (p. 390) Leniency reflects that a manager rates all employees in the middle of the rating
scale.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-8
Topic: Distributional Errors
23. (p. 390) Appraisal politics refer to evaluators purposefully distorting a rating to achieve
personal or company goals.
TRUE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-8
Topic: Appraisal Politics
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Chapter 08 - Performance Management
24. (p. 392) Once the expected performance has been defined and employees' performances have
been measured, it is necessary to feed that performance information back to the employees so
that they can correct any deficiencies.
TRUE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-9
Topic: Performance Feedback
25. (p. 395) Output is a factor to consider in analyzing poor performance.
FALSE
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-10
Topic: What Managers can do to Diagnose Performance Problems and Manage Employees' Performance
Multiple Choice Questions
26. (p. 354) Performance planning and evaluation systems seek to tie the formal performance
appraisal process to the company's:
A. organizational structure.
B. stakeholders' needs.
C. strategies.
D. size.
Performance planning and evaluation (PPE) system refers to any system that seeks to tie the
formal performance appraisal process to the company's strategies by specifying at the
beginning of the evaluation period the types and level of performance that must be
accomplished in order to achieve the strategy.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-1
Topic: An Organizational Model of Performance Management
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Chapter 08 - Performance Management
27. (p. 354) The process through which an organization gets information on how closely an
employee's actual performance met the performance plan is:
A. performance appraisal.
B. performance management.
C. performance feedback.
D. ability analysis.
Performance appraisal requires managers to at least annually communicate to employees their
performance strengths and deficiencies. A good appraisal process ensures that all employees
doing similar jobs are evaluated according to the same standards.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-1
Topic: An Organizational Model of Performance Management
28. (p. 355) Which of the following is NOT a purpose of performance management systems?
A. Administrative
B. Developmental
C. Investigative
D. Strategic
The purposes of performance management systems are of three kinds: strategic,
administrative, and developmental.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-2
Topic: Purposes of Performance Management
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Chapter 08 - Performance Management
29. (p. 358) Which of the following is NOT a recommendation for developing an effective
performance management system?
A. Mirror the corporate culture and values.
B. Differentiate performance subjectively and effectively.
C. Adjust the system as required.
D. Communicate the total rewards system.
A recommendation for developing an effective performance management system is
differentiate performance fairly and effectively.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-2
Topic: Administrative Purpose
30. (p. 359) _____ emphasizes the need for the performance management system to guide
employees in contributing to the organization's success.
A. Specificity
B. Reliability
C. Validity
D. Strategic congruence
Strategic congruence is the extent to which a performance management system elicits job
performance that is congruent with the organization's strategy, goals, and culture.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-3
Topic: Strategic Congruence
8-31
Chapter 08 - Performance Management
31. (p. 360) _____ are factors in a company's business strategy that give it a competitive edge.
A. MBOs
B. OBMs
C. KPIs
D. CSFs
Companies measure employee behavior that relates to attainment of CSFs, which increases
the importance of these behaviors for employees. Employees can be held accountable and
rewarded for behaviors that directly relate to the company attaining the CSFs.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-3
Topic: Strategic Congruence
32. (p. 361) Which performance management evaluation criterion is concerned with maximizing
the overlap between actual job performance and the measure of job performance?
A. Reliability
B. Acceptability
C. Specificity
D. Validity
Validity is the extent to which a performance measure assesses all the relevantand only the
relevantaspects of performance.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-3
Topic: Validity
8-32
Chapter 08 - Performance Management
33. (p. 361) A(n) _____ measure evaluates irrelevant aspects of performance or aspects that are
not job related.
A. unreliable
B. valid
C. contaminated
D. inconsistent
The performance measure should seek to minimize contamination, but its complete
elimination is seldom possible.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-3
Topic: Validity
34. (p. 361) A university that assesses its faculty members more on research work than teaching,
follows which performance management system?
A. Contaminated
B. Deficient
C. Unreliable
D. Inconsistent
A contaminated measure evaluates irrelevant aspects of performance or aspects that are not
job related.
AACSB: Reflective Thinking Skills
BT: Application
Difficulty: Medium
Learning Objective: 8-3
Topic: Validity
8-33
Chapter 08 - Performance Management
35. (p. 361) The consistency among the different individuals who evaluate the employee's
performance is known as:
A. internal consistency reliability.
B. interrater reliability.
C. intrarater reliability.
D. test-retest reliability.
A performance measure has interrater reliability if two individuals give the same (or close to
the same) evaluations of a person's job performance.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-3
Topic: Reliability
36. (p. 362) A measure that results in dramatically different ratings over time lacks:
A. internal consistency reliability.
B. interrater reliability.
C. intrarater reliability.
D. test-retest reliability.
Testretest reliability is the measure which is reliable over time.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 8-3
Topic: Reliability
8-34
Chapter 08 - Performance Management
37. (p. 362-363) Which of the following statements about acceptability is incorrect?
A. Acceptability refers to the extent to which the performance measure assesses all of the
relevantand only the relevantaspects of performance.
B. Acceptability is affected by the extent to which employees believe the performance
management system is fair.
C. The three categories of perceived fairness include procedural fairness, interpersonal
fairness, and outcome fairness.
D. Research suggests that performance management systems that are perceived as unfair are
likely to be legally challenged, used incorrectly, and decrease employee motivation to
improve.
Validity is the extent to which a performance measure assesses all the relevantand only the
relevantaspects of performance.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 8-3
Topic: Acceptability
38. (p. 363) The extent to which the performance measure gives guidance to employees about
what is expected of them is called:
A. reliability.
B. validity.
C. specificity.
D. acceptability.
Specificity is relevant to both the strategic and developmental purposes of performance
management.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-3
Topic: Specificity
8-35
Chapter 08 - Performance Management
39. (p. 363) Which of the following is an inappropriate approach to measuring performance?
A. Comparative approach
B. Attribute approach
C. Consequential approach
D. Behavior approach
The comparative approach to performance measurement requires the rater to compare an
individual's performance with that of others. The attribute approach to performance
management focuses on the extent to which individuals have certain attributes (characteristics
or traits) believed desirable for the company's success. The behavioral approach to
performance management attempts to define the behaviors an employee must exhibit to be
effective in the job.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: Approaches to Measuring Performance
40. (p. 363) _____ ranking consists of a manager looking at a list of employees, deciding who
the best employee is, and crossing that person's name off the list. From the remaining names,
the manager decides who the worst employee is and crosses that name off the listand so
forth.
A. Simple
B. Alternation
C. Reverse
D. Forced
Alternation ranking is a type of ranking, which is a comparative approach technique.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Comparative Approach
8-36
Chapter 08 - Performance Management
41. (p. 365) The technique that ranks employees into predetermined categories or groups
according to performance is called:
A. forced distribution.
B. high/low ranking system.
C. paired comparison.
D. strictness.
The forced distribution method uses a ranking format. In forced distribution employees are
grouped into three, four, or five categories usually of unequal size indicating the best workers,
the worst workers, and one or more categories in between.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Comparative Approach
42. (p. 366) Companies that have clear goals and management criteria, train evaluators, use the
rankings along with other HR metrics, and reward good performance find the following
ranking technique useful.
A. Paired comparison
B. High/low ranking system
C. Forced distribution
D. Strictness
The forced distribution method also uses a ranking format, but employees are ranked in
groups. This technique requires the manager to put certain of percentages employees into
predetermined categories.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Comparative Approach
8-37
Chapter 08 - Performance Management
43. (p. 367) The _____ method requires managers to compare every employee with every other
employee in the work group, giving an employee a score of 1 every time he/she is considered
the high performer.
A. partner measurement
B. mixed-standard scales
C. forced distribution
D. paired comparison
The paired comparison method tends to be time-consuming for managers and will become
more so as organizations become flatter with an increased span of control.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Comparative Approach
44. (p. 367) Company XYZ is facing problems of and has to make administrative decisions of
promotions in order to address its requirement of more mid-level managers. Which
performance management approach should it follow?
A. Attribute approach
B. Comparative approach
C. Behavioral approach
D. Quality approach
The comparative approach to performance measurement requires the rater to compare an
individual's performance with that of others. It is easy to develop, easy to use; thus, often
accepted by users.
AACSB: Reflective Thinking Skills
BT: Application
Difficulty: Hard
Learning Objective: 8-4
Topic: The Comparative Approach
8-38
Chapter 08 - Performance Management
45. (p. 367) The approach to measure and manage performance that focuses on the extent to
which individuals possess desirable characteristics is called the:
A. attribute approach.
B. leadership approach.
C. personality approach.
D. performance approach.
The techniques that use attribute approach define a set of traitssuch as initiative, leadership,
and competitivenessand evaluate individuals on them.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-4
Topic: The Attribute Approach
46. (p. 368) Which attribute approach to performance management is the most frequently used?
A. Behaviorally anchored rating scales
B. Mixed standard scales
C. Behavior observation scales
D. Graphic rating scales
Graphic rating scales can provide a number of different points (a discrete scale) or a
continuum along which the rater simply places a check mark (a continuous scale).
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-4
Topic: The Attribute Approach
8-39
Chapter 08 - Performance Management
47. (p. 368) If a manager considers one employee at a time and circles a number or a word to
signify the degree to which that employee demonstrates a particular trait, he/she is using a:
A. critical incidents approach.
B. mixed standard scale.
C. behavior observation scale.
D. graphic rating scale.
The most common form that the attribute approach to performance management takes is the
graphic rating scale. It can provide a number of different points (a discrete scale) or a
continuum along which the rater simply places a check mark (a continuous scale).
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Attribute Approach
48. (p. 368) In which performance technique are managers given three statements of
performance per dimension and asked to indicate whether the employee's performance is
above (+), at (0), or below (-) the statements?
A. Behaviorally anchored rating scale
B. Mixed-standard scale
C. Behavior observation scale
D. Graphic rating scale
Mixed-standard scales were developed to get around some of the problems with graphic rating
scales.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Attribute Approach
8-40
Chapter 08 - Performance Management
49. (p. 370) Which of the following is TRUE of the attribute approach to performance
management?
A. They result in high strategic congruence.
B. They are difficult to use.
C. They are generalizable across organizations and strategies.
D. They provide specific guidance and feedback to employees.
Attribute-based performance methods are the most popular methods in organizations. If much
attention is devoted to identifying those attributes relevant to job performance and carefully
defining them on the rating instrument, they can be as reliable and valid as more elaborate
measurement techniques.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Hard
Learning Objective: 8-4
Topic: The Attribute Approach
50. (p. 370) This approach to performance management fails to provide any definite guidance on
how an employee can support the company's goals or correct performance deficiencies and
also elicits defensiveness from employees.
A. Quality approach
B. Comparative approach
C. Behavioral approach
D. Attribute approach
Attribute approach techniques fall short on several of the criteria for effective performance
management. There is usually little congruence between the techniques and the company's
strategy.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Hard
Learning Objective: 8-4
Topic: The Attribute Approach
8-41
Chapter 08 - Performance Management
51. (p. 370) The performance management approach that requires managers to keep a record of
specific examples of effective and ineffective performance is called:
A. behaviorally anchored rating scales.
B. behavior observation scales.
C. critical incidents.
D. organizational behavior modification.
Critical incidents give specific feedback to employees about what they do well and what they
do poorly, and they can be tied to the company's strategy by focusing on incidents that best
support that strategy.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
52. (p. 371) Which performance management technique involves the identification of a large
number of critical incidents, the classification of these incidents into performance dimensions,
and the rank ordering of these incidents into levels of performance?
A. Behaviorally anchored rating scales
B. Graphic rating scales
C. Comparative rating scales
D. Organizational behavior modification
Behaviorally anchored rating scales can increase interrater reliability by providing a precise
and complete definition of the performance dimension.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
8-42
Chapter 08 - Performance Management
53. (p. 371) The performance management method that requires managers to rate the frequency
with which the employee has exhibited a behavior during a rating period is the:
A. behaviorally anchored rating scale.
B. behavioral observation scale.
C. graphic rating scale.
D. organizational behavior modification.
A behavioral observation scale (BOS) is a variation of a BARS. Rather than discarding a large
number of the behaviors that exemplify effective or ineffective performance, a BOS uses
many of them to more specifically define all the behaviors that are necessary for effective
performance.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
54. (p. 373) Managing the behavior of employees through a formal system of behavioral
feedback and reinforcement refers to:
A. behaviorally anchored rating scales.
B. behavior observation scales.
C. critical incidents.
D. .
Organizational behavior modification builds on the behaviorist view of motivation, which
holds that individuals' future behavior is determined by past behaviors that have been
positively reinforced.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
8-43
Chapter 08 - Performance Management
55. (p. 374) Which of the following is a process where appraisers observe the individuals'
behavior and evaluate their skill or potential as managers for promotion decisions?
A. Productivity measurement and evaluation system
B. Management by objectives
C. Assessment centers
D. Organizational behavior modification
Assessment centers allow specific performance feedback, and individualized developmental
plans can be designed.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
56. (p. 375) Which of the following is NOT true regarding behavioral approaches to performance
measurement?
A. They link strategy to specific behavior needed to implement strategy.
B. They provide specific guidance to employees regarding expected performance.
C. They result in techniques that have a high degree of validity.
D. The behavioral approach might be best suited to complex jobs.
The behavioral approach might be best suited to less complex jobs (where the best way to
achieve results is somewhat clear) and least suited to complex jobs (where there are multiple
ways, or behaviors, to achieve success).
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
8-44
Chapter 08 - Performance Management
57. (p. 375) In what type of system are annual goals established and passed down through the
organization?
A. Productivity measurement and evaluation system
B. Management by objectives
C. Assessment centers
D. Organizational behavior modification
Management by objectives systems have three common components. They require specific,
difficult, objective goals.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Results Approach
58. (p. 375-376) Which of the following is generally NOT true of management by objectives?
A. Goals are usually established unilaterally by management.
B. Goals are specific, difficult, and objective in nature.
C. Individual goals are linked to the company's strategic goals.
D. Objective managerial feedback is provided to employees throughout the rating period.
The goals are not usually set unilaterally by management but with the managers' and
subordinates' participation. And the manager gives objective feedback throughout the rating
period to monitor progress toward the goals.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 8-4
Topic: The Results Approach
8-45
Chapter 08 - Performance Management
59. (p. 376) Which of the following is a means of measuring and feeding back productivity
information to personnel with the main goal of motivating employees to higher levels of
productivity?
A. Management by objectives
B. ProMES
C. Assessment centers
D. Critical incidents
The main goal of ProMES is to motivate employees to higher levels of productivity.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Results Approach
60. (p. 376-377) Which of the following is NOT a step in the ProMES system?
A. People in the organization identify the set of activities or objectives the organization
expects to accomplish.
B. The staff defines indicators of the products.
C. Feedback is determined using rate of return.
D. The staff establishes the contingencies between the amount of the indicators and the level
of evaluation associated with that amount.
The fourth step in ProMES system is, a feedback system is developed that provides
employees and work groups with information about their specific level of performance on
each of the indicators.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 8-4
Topic: The Results Approach
8-46
Chapter 08 - Performance Management
61. (p. 377) The _____ approach minimizes subjectivity, relying on objective, quantifiable
indicators of performance.
A. quality
B. comparative
C. results
D. attribute
Results approach is highly acceptable to both managers and employees. It links an individual's
results with the organization's strategies and goals.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Results Approach
62. (p. 379) A performance management system designed with a strong quality orientation can
be expected to do all of the following EXCEPT:
A. emphasize an assessment of both person and system factors in the measurement system.
B. emphasize that managers and employees work alone to solve performance problems.
C. involve both internal and external customers in setting standards and measuring
performance.
D. use multiple sources to evaluate person and system factors.
A performance management system designed with a strong quality orientation can be
expected to emphasize that managers and employees work together to solve performance
problems.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 8-4
Topic: The Quality Approach
8-47
Chapter 08 - Performance Management
63. (p. 379) Advocates of the quality approach believe that most U.S. companies' performance
management systems are incompatible with the quality philosophy for a number of reasons.
Which one of the following is NOT among these reasons?
A. Most existing systems measure performance in terms of quantity, not quality.
B. They involve both internal and external customers in setting standards and measuring
performance.
C. Companies do not share financial rewards of successes with employees.
D. Employees are held accountable for good or bad results to which they contribute but do not
completely control.
A performance management system designed with a strong quality orientation can be
expected to involve both internal and external customers in setting standards and measuring
performance. Also, rewards not being connected to business results is one of the reason
advocates of the quality approach believe that most U.S. companies' performance
management systems are incompatible with the quality philosophy.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Hard
Learning Objective: 8-4
Topic: The Quality Approach
64. (p. 379-380) Quality advocates suggest that performance evaluations should do all but one of
the following. Name the exception.
A. Performance evaluations should include a discussion of the employee's career plans.
B. Two types of feedback should be provided: subjective and objective.
C. Employee performance evaluations should be linked to compensation.
D. The performance appraisal system should avoid providing an overall evaluation (rating) of
the employee.
Linking compensation to the performance management system is one of the recommendations
for developing an effective performance management system.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Hard
Learning Objective: 8-4
Topic: The Quality Approach
8-48
Chapter 08 - Performance Management
65. (p. 380) Which of the following statistical process quality control techniques helps identify
redundancies in jobs that increase manufacturing or service time?
A. Cause-and-effect diagrams
B. Control charts
C. Pareto charts
D. Process-flow analysis
Process-flow analysis identifies each action and decision necessary to complete work, such as
waiting on a customer or assembling a television set.
AACSB: Reflective Thinking Skills, Statistical Data Analysis & Management Science
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Quality Approach
66. (p. 380) The quality control technique that lists causes of a problem in decreasing order of
importance is a:
A. cause-and-effect diagram.
B. control chart.
C. Pareto chart.
D. process-flow analysis.
A Pareto chart highlights the most important cause of a problem. The assumption of Pareto
analysis is that the majority of problems are the result of a small number of causes.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Quality Approach
8-49
Chapter 08 - Performance Management
67. (p. 380) Which quality control technique is useful for understanding the amount of variance
between an outcome and the expected value or average outcome?
A. Control chart
B. Histogram
C. Cause-and-effect diagram
D. Process-flow analysis
Histograms display distributions of large sets of data. Data are grouped into a smaller number
of categories or classes.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Quality Approach
68. (p. 382) Which quality control technique shows the relationship between two variables,
events, or different pieces of data?
A. Scattergram
B. Control chart
C. Pareto chart
D. Process-flow analysis
Scattergrams help employees determine whether the relationship between two variables or
events is positive, negative, or zero.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Quality Approach
8-50
Chapter 08 - Performance Management
69. (p. 383) Identify the evaluation approach to performance measurement that meets the
following criteria: very high strategic congruence, usually high validity, high reliability, high
acceptability, and high specificity.
A. Comparative
B. Attribute
C. Behavioral
D. Results
The results approach has a very high strategic congruence, high validity, high reliability, high
acceptability, and high specificity compared to comparative, attribute, behavioral, and quality
approaches.
AACSB: Reflective Thinking Skills
BT: Application
Difficulty: Hard
Learning Objective: 8-5
Topic: Approaches to Measuring Performance
70. (p. 383) Identify the approach to performance measurement that meets the following criteria:
poor strategic congruence, modest to possibly high validity, little to modest reliability,
moderate acceptability, and very low specificity.
A. Comparative
B. Attribute
C. Behavioral
D. Results
Comparative approach has poor strategic congruence, modest to possibly high validity, little
to modest reliability, moderate acceptability, and very low specificity compared to results,
attribute, behavioral, and quality approaches.
AACSB: Reflective Thinking Skills
BT: Application
Difficulty: Hard
Learning Objective: 8-5
Topic: Approaches to Measuring Performance
8-51
Chapter 08 - Performance Management
71. (p. 383) Identify the approach to performance measurement that meets the following criteria:
high strategic congruence, usually high validity, usually high reliability, moderate
acceptability, and very high specificity.
A. Comparative
B. Attribute
C. Behavioral
D. Results
Behavioral approach has high strategic congruence, high validity, high reliability, moderate
acceptability, and very high specificity compared to results, attribute, comparative, and
quality approaches.
AACSB: Reflective Thinking Skills
BT: Application
Difficulty: Hard
Learning Objective: 8-5
Topic: Approaches to Measuring Performance
72. (p. 383) Identify the approach to performance measurement that meets the following criteria:
usually low strategic congruence, usually low attribute, usually low reliability, high
acceptability, and very low specificity.
A. Comparative
B. Attribute
C. Behavioral
D. Results
Attribute approach has low strategic congruence, low attribute, low reliability, high
acceptability, and very low specificity compared to results, behavioral, comparative, and
quality approaches.
AACSB: Reflective Thinking Skills
BT: Application
Difficulty: Hard
Learning Objective: 8-5
Topic: Approaches to Measuring Performance
8-52
Chapter 08 - Performance Management
73. (p. 383, 385) Which of the following is NOT true of managers as the source of performance
measures?
A. Managers are the most frequently used source of performance information.
B. Managers are generally motivated to make accurate ratings.
C. Manager-based performance evaluations eliminate the concern of favoritism.
D. Managers are viewed by employees as legitimate sources of performance information.
Some supervisors may be so biased against a particular employee that to use the supervisor as
the sole source of information would result in less-than-accurate measures for that individual.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 8-7
Topic: Managers
74. (p. 385) Which of the following is NOT true of peers as the source of performance
measures?
A. Peers have expert knowledge of job requirements.
B. Peer ratings are particularly useful for administrative and strategic decision making.
C. Peer ratings are particularly useful when supervisors do not have the opportunity to
observe employees.
D. Peers have been found to provide extremely valid assessments of performance in several
different settings.
Disadvantage of peer rating is that when the evaluations are made for administrative
decisions, peers often find the situation of being both rater and ratee uncomfortable. When
these ratings are used only for developmental purposes, however, peers react favorably.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 8-7
Topic: Peers
8-53
Chapter 08 - Performance Management
75. (p. 386) These sources of performance information are especially valuable when managers
are being evaluated and often have the best opportunity to evaluate how well a manager treats
employees.
A. Supervisors
B. Subordinates
C. Top-level management
D. Customers
One problem with subordinate evaluations is that they give subordinates power over their
managers, thus putting the manager in a difficult situation.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-7
Topic: Subordinates
76. (p. 386) Subordinates, as a source of performance information, are generally most
appropriate when the performance results are to be used for:
A. training purposes.
B. investigative purposes.
C. strategic purposes.
D. developmental purposes.
Subordinates are an especially valuable source of performance information when managers
are evaluated. Subordinates often have the best opportunity to evaluate how well a manager
treats employees.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-7
Topic: Subordinates
8-54
Chapter 08 - Performance Management
77. (p. 386) Managerial performance appraisal that involves subordinates' evaluations of the
manager's behavior or skills is:
A. upward feedback.
B. 360-degree feedback.
C. a traditional performance appraisal.
D. multi-rater feedback.
Upward feedback refers to appraisals that involve collecting subordinates' evaluations of
manager's behavior or skills.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 8-7
Topic: Subordinates
78. (p. 387) Using customer evaluations of employee performance is appropriate in all but one of
the following situations. Name the exception.
A. When the company wants an inexpensive means of evaluation.
B. When an employee's job requires direct service to the customer or linking the customer to
other services within the company.
C. When the company's strategic goal is to integrate marketing strategies with human resource
activities and policies.
D. When the company is interested in gathering information to determine what products or
services the customer wants.
The weakness of customer surveys is their expense. Printing, postage, telephone, and labor
can add up to hundreds of dollars for the evaluation of one individual. Thus many companies
conduct such evaluations only once a year for a short time.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Hard
Learning Objective: 8-7
Topic: Customers
8-55
Chapter 08 - Performance Management
79. (p. 388) Which rater error is made when one judges those who are comparable to him/her in
the immediate work group higher than those who are not?
A. Contrast
B. Distributional error
C. Halo/horns
D. Similar to me
Most of us tend to think of ourselves as effective, and so if others are like usin race, gender,
background, attitudes, or beliefswe assume that they too are effective.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-8
Topic: Similar to Me
80. (p. 388) In a workgroup, a completely competent performer is working with a number of
peers who are outstanding. If the competent employee receives lower-than-deserved ratings
because of the outstanding colleagues, then which rater error has occurred?
A. Contrast
B. Distributional error
C. Halo/horns
D. Similar to me
Contrast error occurs when we compare individuals with one another instead of against an
objective standard.
AACSB: Business Knowledge and Analytic Skills
BT: Application
Difficulty: Medium
Learning Objective: 8-8
Topic: Contrast
8-56
Chapter 08 - Performance Management
81. (p. 390) Which rater error makes it difficult to distinguish among employees rated by the
same rater and creates problems in comparing the performance of individuals rated by
different raters?
A. Contrast
B. Distributional error
C. Halo/horns
D. Similar to me
Distributional errors are the result of a rater's tendency to use only one part of the rating scale.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-8
Topic: Distributional Errors
82. (p. 390) If a student evaluating his/her professor at the end of term rates the professor low on
all performance criteria due to dissatisfaction with the professor's grading scale, the student
has likely committed which rater error?
A. Contrast
B. Halo
C. Central tendency
D. Horns
Horns error works in the opposite direction: one negative aspect results in the rater assigning
low ratings to all the other aspects.
AACSB: Reflective Thinking Skills
BT: Application
Difficulty: Medium
Learning Objective: 8-8
Topic: Halo and Horns
8-57
Chapter 08 - Performance Management
83. (p. 390) Which rater error leads employees to believe that no aspects of their performance
need improvement?
A. Contrast
B. Halo
C. Horns
D. Similar to me
Halo error occurs when one positive performance aspect causes the rater to rate all other
aspects of performance positively.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-8
Topic: Halo and Horns
84. (p. 390) A situation in which evaluators purposefully distort a rating to achieve personal or
company goals is referred to as:
A. upward feedback.
B. downward feedback.
C. appraisal politics.
D. calibration politics.
Appraisal politics refer to evaluators purposefully distorting a rating to achieve personal or
company goals.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-8
Topic: Appraisal Politics
8-58
Chapter 08 - Performance Management
85. (p. 391) What type of training attempts to emphasize the multidimensional nature of
performance and thoroughly familiarize raters with the actual content of various performance
dimensions?
A. Performance training
B. Error reduction training
C. Multidimensional training
D. Rater accuracy training
Appraisal politics are most likely to occur when raters are accountable to the employee being
rated, there are competing rating goals, and a direct link exists between performance appraisal
and highly desirable rewards.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-8
Topic: Reducing Rater Errors, Politics, and Increasing Reliability and Validity of Ratings
86. (p. 391) _____ attended by managers provide a way to help ensure that performance is
evaluated consistently across managers and to reduce the influence of rating errors and
politics on appraisals.
A. Calibration meetings
B. Employee-review meetings
C. Multidimensional training
D. Rater accuracy training
Calibration meetings include managers responsible for conducting performance appraisals and
their managers and are facilitated by an internal HR representative or an external consultant.
In the meetings, each employee's performance rating and the manager's reasons for the ratings
are discussed.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-8
Topic: Reducing Rater Errors, Politics, and Increasing Reliability and Validity of Ratings
8-59
Chapter 08 - Performance Management
87. (p. 392-394) To improve the performance feedback process, managers should do all but one of
the following. Name the exception.
A. Give employees feedback frequently, not just during the feedback session.
B. Let employees rate their performance before the feedback session.
C. Conduct the feedback session in his/her office.
D. Focus on behavior or results, not on the person.
To improve the performance feedback process, managers should give employees feedback
frequently, not just during the feedback session, create the right context for the discussion, ask
the employee to rate his or her performance before the session, encourage the subordinate to
participate in the session, recognize effective performance through praise, focus on solving
problems, focus feedback on behavior or results, not on the person, minimize criticism and
agree to specific goals and set a date to review progress.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 8-9
Topic: The Manager's Role in an Effective Performance Feedback Process
88. (p. 396) An employee that is performing at a barely acceptable level because of lack of
ability and/or motivation to perform well, not poor work conditions, is called a(n):
A. marginal employee.
B. inconsistent employee.
C. social loafer.
D. mediocre performer.
Chronic poor performance by employees with low ability and motivation (deadwood)
indicates that outplacement or firing may be the best solution. Poor performance resulting
from lack of ability but not motivation (misdirected effort) may be improved by skill
development activities. Managers with employees who have the ability but lack motivation
(underutilizers) need to consider actions that focus on interpersonal problems or incentives.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-10
Topic: Actions for Managing Employees' Performance
8-60
Chapter 08 - Performance Management
89. (p. 397) In what legal suit would the plaintiff allege that the performance measurement
system varies according to individuals?
A. Harassment suit
B. Reverse discrimination suit
C. Unjust dismissal suit
D. Discrimination suit
There is an evidence that the discriminatory biases in performance rating are worse when one
group makes up a small percentage of the work group.
AACSB: Reflective Thinking Skills, Ethical/Legal Responsibilities in Organizations & Society
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-10
Topic: Developing and Implementing a System That Follows Legal Guidelines
90. (p. 397) In what legal suit does the plaintiff claim that the termination was for reasons other
than those the employer claims?
A. Harassment suit
B. Reverse discrimination suit
C. Unjust dismissal suit
D. Discrimination suit
Unjust dismissal can result from terminating for poor performance an employee who has a
history of favorable reviews and raises.
AACSB: Reflective Thinking Skills, Ethical/Legal Responsibilities in Organizations & Society
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-10
Topic: Developing and Implementing a System That Follows Legal Guidelines
Essay Questions
8-61
Chapter 08 - Performance Management
91. (p. 355-359) Discuss the three purposes of performance management systems and the degree
to which each purpose is being achieved.
Strategic purpose. First and foremost, a performance management system should link
employee activities with the organization's goals. To achieve this goal, the system must be
flexible, because when goals and strategies change, the results, behaviors, and employee
characteristics usually need to change correspondingly. However, performance management
systems do not commonly achieve this purpose.
Administrative purpose. Performance management systems are often used to assist
managers in making administrative decisions. These decisions include salary administration
(pay raises), promotions, retention-termination, layoffs, and recognition of individual
performance. A survey of HR practitioners suggests that most systems focus on administrative
and developmental purposes.
Developmental purpose. A third purpose of performance management is to develop
employees who are effective at their jobs. Ideally, performance management systems identify
not only any deficient aspects of employee performance, but also the causes of these
deficiencies. However, managers are often uncomfortable confronting employees with their
performance weaknesses. Therefore, they often give high ratings to all employees, causing the
developmental purposes of performance management systems not to be fully achieved.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 8-2
Topic: Purposes of Performance Management
8-62
Chapter 08 - Performance Management
92. (p. 363-367) What does the comparative approach do in terms of measuring performance?
Discuss the three techniques that fall under the comparative approach.
The comparative approach to performance measurement requires the rater to compare an
individual's performance from that of others.
Three techniques that fall under this approach are ranking, forced distribution, and paired
comparison.
Ranking includes simple and alternation ranking.
Simple ranking requires managers to rank employees within their departments from highest
performer to poorest performer.
Alternation ranking consists of a manager crossing off top performers and poor performers
from a list of employees in sequential order.
The forced distribution method also uses a ranking format, but employees are ranked in
groups.
The paired comparison method requires managers to compare every employee with every
other employee in the work group, giving an employee a score of 1 every time he/she is
considered the higher performer.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 8-4
Topic: The Comparative Approach
93. (p. 371-373) Discuss the process of developing behaviorally anchored rating scales. How do
behavioral observation scales (BOS) differ from behaviorally anchored rating scales?
The BARS process involves three steps: (1) Gather a large number of critical incidents that
represent effective and ineffective performance on the job. (2) Classify the incidents into
performance dimensions. (3) Agree on which incidents represent a particular level of
performance to be used as behavioral examples. Identify anchors to guide the rater.
Rather than discarding a large number of the behaviors that exemplify effective or ineffective
performance, BOS uses many of them to specifically define all the behaviors that are
necessary for effective performance.
Rather than assessing which behavior best reflects an individual's performance, BOS
requires managers to rate the frequency with which the employee has exhibited each behavior
during the rating period.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
8-63
Chapter 08 - Performance Management
94. (p. 374) What is an assessment center? What are the advantages of an assessment center?
Individuals perform a number of simulated tasks while assessors observe the individuals'
behaviors and make evaluations about their skill or potential as managers.
The advantage of assessment centers is that they provide a somewhat objective measure of
an individual's performance at managerial tasks. In addition, they allow specific performance
feedback, and individualized developmental plans can be designed.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 8-4
Topic: The Behavioral Approach
95. (p. 375) What are the three common components of a management by objectives (MBO)
system?
The common components include (1) MBO systems require specific, difficult, objective
goals. (2) Goals are not usually set unilaterally by management but with the managers' and
subordinates' participation. (3) The manager gives objective feedback throughout the rating
period to monitor progress toward the goals.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Results Approach
8-64
Chapter 08 - Performance Management
96. (p. 376-377) What is the main goal of the Productivity Measurement and Evaluation System
(ProMES)? What are the four steps of ProMES?
The main goal of ProMES is to motivate employees to higher levels of productivity and to
measure and provide feedback productivity information to employees. The four steps include:
1. People identify the products and objectives the organization expects to accomplish.
2. The staff defines indicators of the products.
3. The staff establishes the contingencies between the amount of the indicators and the level
of evaluation associated with that amount.
4. A feedback system is developed that provides employees and work groups with
information regarding their specific level of performance on each of the indicators.
AACSB: Reflective Thinking Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 8-4
Topic: The Results Approach
97. (p. 379) What results can be expected from a performance management system designed
with a strong quality orientation?
Emphasize an assessment of both person and system factors in the measurement system.
Emphasize that managers and employees work together to solve performance problems.
Involve both internal and external customers in setting standards and measuring
performance.
Use multiple sources to evaluate person and system factors.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 8-4
Topic: The Quality Approach
8-65
Chapter 08 - Performance Management
98. (p. 383) Discuss the differences between the attribute and behavioral approaches to
performance measurement related to the criteria of (a) strategic congruence, (b) validity and
(c) reliability.
a) Attribute approaches are usually low on strategic link, while behavioral approaches are
quite high.
b) Attribute approaches usually possess low validity, while behavioral approaches are high.
c) Finally, attribute approaches have low reliability, while behavioral approaches have high
reliability.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 8-5
Topic: Approaches to Measuring Performance
99. (p. 388-390) Discuss the various rater errors in performance management.
There are five main rater errors that can occur in performance evaluations.
The first is "similar to me". This occurs when we judge those who are similar to us more
highly than those who are not.
Contrast errors occur when we compare individuals with one another instead of against an
objective standard.
Distributional errors are the result of a rater's tendency to use only one part of the rating scale.
Leniency, strictness, and central tendency are examples.
A halo error occurs when one positive performance aspect causes the rater to rate all other
aspects of performance positively.
A horn error results in the rater assigning low ratings to all aspects for one negative aspect.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 8-8
Topic: Rater Errors in Performance Measurement
8-66
Chapter 08 - Performance Management
100. (p. 392-394) Discuss at least four ways to improve the performance feedback process.
1. Feedback should be given frequently, not once a year.
2. Create the right context for the discussion.
3. Ask the employee to rate his/her performance before session.
4. Encourage the subordinate to participate in the session.
5. Recognize effective performance through praise.
6. Focus on solving problems.
7. Focus feedback on behavior or results, not on the person.
8. Minimize criticism.
9. Agree to specific goals and set a date to review progress.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 8-9
Topic: The Manager's Role in an Effective Performance Feedback Process
8-67