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GOVT ACCESSION No.

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3. Rý*1ENT S CATALOG NUMBER

BEHAVIORAL STRATEGIES FOR ENH-ANqCING PRODUCTIVITYJehia

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6.PERFORMING

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001O~4-79-C-0750

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PE~rORMING ORGANI41ZATION

9.

NAME AND ADDRESS

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10. PROGRAM ELEMENT. PROJECT. TASK ARtEA & WORK UNIT NUMBERS

Aduiniist ration

University-of- Washington

~~~Seattle,

WA

NR 170-890

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98195

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CONTROLLING OFFtCE NAME AND ADDRESSPr

mtiI

REPORT NUMBER

OR GRANT NUMUER(s)

Gary Latham L. L. Cummings/s Terence R. Mitchell

%ago-eol-f-u~ns

et ORG.

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Organizational Effectiveness Research Proi1WuyE8I

Office of Naval Research (Code 452) 22217 Arlington, VA 14

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AGENCY N AME &

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IS: SECURITY CLASS. (of this r*Port)

Unclassified 1Sa, OECL ASSI PIC ATION" DOWN ORADING SCHEDULE

Approved fur public release; dist-.ibution unlimited.

17. DISTRIBUTION

ST ATEMENY (of Ihe abstract e.Ier,rd in block 20, It different from, ReporI)

I1. SUPPLEMENTARY NOTES

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KEY WORDS (Coni~n-,.on favors* aide It necessary MndIdentify by block nmb.er)

attribution theory behavioral consequences behavioral observation scales criLi :al incident technique 20

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ASISTRACT (Contilnue on, roervr.

(continued on reverse)

aide It necessary and identity by block number)

'7A three stage process is proposed for enhancing productivity through the utilization of human resources. The stages comprising the process are: (1) Identifying poor performance; (2) deciding what causes poor performlance; and (3) coping with poor performance. Together these strategies form a performaince enhancement system. Strategies for identifying a poor performance include examining discrepancies between goals -and measured achievement, making comparisons across people,

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feedback goal setting job analysis performance appraisal performance definitions productivity rating errors

20.

units or organizations, and making comparisons across time. A model for diagnosing and responding to poor performance is Empirical results in support presenLudt based on attribution theory. of the model are discussed. Steps for coping with poor performance include (1) defining performance behaxiorally, (2) training managers to minimize rating errors, (3) setting specific hard goals, and (4) ensuring that the consequences of working toward and attaining the goals are positive for the employee. V

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Funav~oral Strategies

fcr Enhancing Productivity

Gary L.athaz Gradua--e School of Bu3iness Administration UnIverrsity of Washington Seattle, ý..1a Ihington 98395

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CLm~ingý

Gra-duatc Sc!.c.l of Buslncss UJniversity of Wi!.consIn-Madison Madison, Wisconsin 53706

Terence R. Mitchell Graduatc

3

School of Business Administration of Washington

University

Seattle, Washington 98195

1

Order of authorship was determined by a random diaw--all three authors Profern:r Latham ackno'aledges contributed eeLu3llV to the •Mnu5cIi~t. ;00014-79-Cthe ;uprorL of tI.e Office of Naval Research, Contract 1o. 0660. r

wiiher

ýesc-arch,

Contract N&.

2 Prufe -,'r Naval

""art

to

of the tcených dl-CuLnued

c*.,-.....lug.. the bupport of the Office of 00914-79-C.-07,. in

this paper wao

supported ýy

the Army

C0c!LrICt NO. miA •;,C,-79-C-0543 and The National Rcsa7.c:. listl.tut Scienct Fourndaticn Crant ,o. DAR 7b-09792 (lerence R. Mitchell and Lee Roy Bcach, Principal Inves3tigators).

BEHAVIOFLkL STRATEGIES FOR ENLANCIING PRODUCTIVITY

America is

in

trouble.

The competitlve spirit

has caught-on around

the world and we are no longer the leaders in productivity gains--indeed,

it would be argued that we are danuerous1v close to being out of the -ete! Recently,

the Bureau of Labor Statistics published some unsettling data.

Of seven leading industrial nations, productivity increase3

the United States ranked sixth in

from 1968 to 1978.

According to the study,

the

rankings are:

1968-1978 Productivity Increases 1.

'Me Netherlands

93.7%

2.

Japan

89.1

3.

West Germa3ny

o3.8

4.

France

61.8

5.

Italy

60.1

6.

United States

23.6

7.

United Kingdom

21.6

Increasingly,

top level executives involved in

strategic decision

making are beginning to em-phasize the importance of an organization's

"1-,nan resources *Ito

for enhancing productivity.

develop hraan resources. improving the quality of life a pyStena•Lc necLsnary.

I

can be taken

These range from improving work methods to at work.

Before selecting a particular tactic

perspective on the causes of good and poor performance is Without such a ýurspective,

may be prnoted and erroneously

1 Source:

Many approaches

productivity improvement techniques

accepted without sufficient documentary

Burexu of Labor Statistic7., of Labor, 197?.

Uliited States Department

2

evidence of their effects and Seneralizability across This article presents such a perspective.

uidustries.

A three stage process is

proposed for enhancing productivity through the util3zation of human resources.

The stages comprislag the process are:

1. Strategies for Identifving poor performance 2.

Strategies for deciding what causes poor perfor=ance

3.

Strategies for Copng with pjor performance

Together these strategies form a performance eahancement system.

This

system is depictes ýr F:gure 1:

Identifying Poor Performance

Coping with Poor Performance to Increase Productivity Deciding what Caused the Poor Performance

IDNTIFYING POOR PEORYOMANCE How should managers go about identifyinS problems?

How do they?

many cases the answers to these two questions are not the same.

In

Basically.

we can refer to an ideal approach concerning how managers should identify problems as a rational approach to problem ldentifIcation. can think of the descriptive posture concerning hoa

BEST AVAILABLE COPY

In contrast, we

managers actually do

*

1

3

identify performance problems as a conditionally rational approach subject to the limitation of managers as processors of information and as decision makers.

There is emierging evidence indicating that the processes actually used

by mnanagers in fot-nulatting and identifying performance problems are not always Completely rational. 2Hopefully, actall

a better- understanding of what we

docan lead to the development and tLiplementation ot. strategies

that will bring us CI.QSer: to what we should do. Tyia

vl--o

This section

Proct-dur-s

~ri~ll

des :ribe zhe two n-2st preval~ent systems for eval m~t-

ing performinrce in todal'.' and personality traits.

organiz.n:ions:

the ut.e of performance outcomes,

We will .`len deqcri'be the judgment processes under-

lying the use of rational procedures in

identifying performance problems.

Thi's is folloued by a descriptsion of several limitations to cthe use of these rational processes. Porformarice Outtconcs

Senior level management, stockholders and consumers are generally concerned with perforaace outcomes as moastires of an individual's level of productivity'.

That is, they are concerned with cost-related measures such

as profits, costs, product quantiry and quality, returns on investment. etc. :hp person who scoies well on these nea-oures

* I2

Is

presumed to be highly

Dte NaturF' of Mana~cKial_ Work, published originally by Harper and Rctw, 1973; 19P,0 editio n published by Prentice-Hall, Inc., Hintzber6, Her.ry.

Englewood Cliffs, N.J., Ch~apters 3,04 a-,d 5;

'Aiuitzberg, He.;ry,

D.

Raisin~hani and A. Thcoret. "The Structure of 'Unstructured' Decision Processes," AdM 4.tn-trstl-e c' iene Larcr l, Vol. 21, No. 2, June 1976, pp. 24~6-275; Ackcif, Russell L. The Art of Problem SolyIng,, John Wiley ar. Srns, New York, N.Y. , 19'17; Liles, Marjorie A. and Ian 1. Kitroff . "Organizationil Frehllom For .0Rtion: An 1.npirie~al Study," Administrative Science Our~iVol.

25,

No.

1,

ML-rch l9bO,

pp. 102-119.

4

motivated toward perfor-ance improvement.

The person who has received adequate

resources including training to do the Job, measures,

is

but performs poorly on these

presumed to be poorly motivated.

Performance outcomes may serve as an excellent ization's health or effectiveness, ures,

by themselves,

thermometer of an organ-

but they are generally

inadequate meas-

of an individual employee's job effect'.eness.

fact, they can even be demotivating,

if

not destructive,

In

for both the indi-

vidual and thQ e:mployer for the following reasons. First,

cost-related measures are oft-n affected by factor5 over which

an individual employee has little indivitual is It

is

The pae:formnnce of one

often causally aftected by the perfort.30ce of other individuals.

not cnly unfair,

rewards and puninhments bonus, etc.)

or no control.

but it (a.g.,

can be illegal to distribute orga.izational promotion,

transfer,

demotion, ticmissal,

ou the basis of measures over which an employee has minimal

control. S2cond, these meas-ires arm often deficient in aspacts of a person's job.

For example,

that they omit important

a superintendent

in one district

may loan equipmer.t to a superintendent in another districL. be an increase

in profits for the compjny,

superintendent who loaned the equipment.

The result may

but an increase in costs for the The poor memory of a superior and

the lack of completeness of the accountrng system which "keeps

score" may

lead to the identification of a "winner" and a "loser" rather than the behaviors of two team playcr

who contributAd to the overall profits of the

company. Third,

these measures can encourage a results-at-all-costs mentality

that can run counter

to r rporate ethics

policies, noc to mention legal

5

requirements.

Moreover,

a rcsults-at-all-costs

mentality can run counter

to the overall productivity of the organization.

In the above example,

loaning equipmcut hurt the monthly cost sheet of the loaner, cantly increased the profits of the organization. been true if

the individual had adhered

but it

signifi-

The reverse might have

to a "my own results at all

costs"

philosophy. Fourth, collar jobs.

cost-related ceaiures are difficult

to obtain for most white-

For e.: