Manage Employee Performance Entrepreneurial ventures that seek to gain

Manage employee performance entrepreneurial ventures

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Manage Employee Performance Entrepreneurial ventures that seek to gain strategic advantage over their competitors based on the strength of their employees need to manage the performance of all employees. As a company grows, it becomes more important to have a system to manage behavior and results, and to ensure these results are consistent with the goals and strategy of the venture. Use Performance Management Systems A startup company with a poor cash position may also encounter problems relating to its employees; employees may feel as though they are not getting an appropriate level of pay, which, in turn, may cause performance to suffer. An employee may also feel as though he or she does not have the necessary support and resources from the company to meet critical time
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36 schedules and to be able to provide adequate customer service. Entrepreneurial companies may encounter special constraints such as acquiring the capital needed to purchase hardware and other resources that are necessary for the company to develop and implement the ideas that will translate into new products and services. Alternatively, for some employees of startup companies being a part of a more fluid organizational structure gives them a sense of empowerment and, as a result, their performance and initiative may be enhanced. As the company grows, it is important to manage the relationship between employee performance and the organization's strategies and goals, and performance reviews should take place on a regular basis. The basic components of a performance management system include: • Setting goals or wo rk standards • Assessing performance relative to those standards • Providing feedback to employees so they can improve their performance and develop their capabilities and skills Understanding the Types of Performance Appraisals There are many different ways of evaluating an employee's performance that are appropriate for new ventures. The primary methods include evaluations based on: (a) Employee attributes, (b) Employee behaviors, and (c) Employee achievements The attribute approach emphasizes qualities or characteristics that are important to the organization. Ratings scales are the most commonly used method of evaluation and are the easiest to design and administer. The scale can be used for most employees of the company. For example, organizations could evaluate employees on leadership, teamwork, results, and goal orientation. The drawback of this method is that it is too generic to be aligned with the strategic goals of the organization. This method is also subject to bias effects, as some evaluators have a tendency to give high ratings (i.e., are too lenient).
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37 The second widely used approach defines and evaluates employee behaviors necessary to complete a job successfully. This type of appraisal focuses on critical incidents and behavioral expectation scales. Critical incidents are situations linked to success and failure for a specific job.
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