Management 14th Edition by Leslie Rue,Lloyd Byars ,Nabil Ibrahim

Exercise 1

Conducting a Performance Appraisal
Plant manager Paul Dorn wondered why his boss, Leonard Hech, had sent for him. Paul thought Leonard had been tough on him lately; he was slightly uneasy at being asked to come to Leonard's office at a time when such meetings were unusual. "Close the door and sit down, Paul," invited Leonard. "I've been wanting to talk to you." After preliminary conversation, Leonard said that because Paul's latest project had been finished, he would receive the raise he had been promised on its completion.
Leonard went on to say that since it was time for Paul's performance appraisal, they might as well do that now. Leonard explained that the performance appraisal was based on four criteria: (1) the amount of high-quality merchandise manufactured and shipped on time, (2) the quality of relationships with plant employees and peers, (3) progress in maintaining employee safety and health, and (4) reaction to demands of top management. The first criterion had a relative importance of 40 percent; the rest had a weight of 20 percent each.
On the first item, Paul received an excellent rating. Shipments were at an all-time high, quality was good, and few shipments had arrived late. On the second item, Paul also was rated excellent. Leonard said plant employees and peers related well to Paul, labor relations were excellent, and there had been no major grievances since Paul had become plant manager.
However, on attention to matters of employee safety and health, the evaluation was below average. His boss stated that no matter how much he bugged Paul about improving housekeeping in the plant, he never seemed to produce results. Leonard also rated Paul below average on meeting demands from top management. He explained that Paul always answered yes to any request and then disregarded it, going about his business as if nothing had happened.
Seemingly surprised at the comments, Paul agreed that perhaps Leonard was right and that he should do a better job on these matters. Smiling as he left, he thanked Leonard for the raise and the frank appraisal.
As weeks went by, Leonard noticed little change in Paul. He reviewed the situation with an associate:
It's frustrating. In this time of rapid growth, we must make constant changes in work methods. Paul agrees but can't seem to make people break their habits and adopt more efficient ones. I find myself riding him very hard these days, but he just calmly takes it. He's well liked by everyone. But somehow, he's got to care about safety and housekeeping in the plant. And when higher management makes demands he can't meet, he's got to say, "I can't do that and do all the other things you want, too." Now he has dozens of unfinished jobs because he refuses to say no.
As he talked, Leonard remembered something Paul had told him in confidence once. "I take Valium for a physical condition I have. When I don't take it, I get symptoms similar to a heart attack. But I only take half as much as the doctor prescribed." Now, Leonard thought, I'm really in a spot. If the Valium is what is making him so lackadaisical, I can't endanger his health by asking him to quit taking it. And I certainly can't fire him. Yet, as things stand, he really can't implement all the changes we need to fulfill our goals for the next two years.
Questions
1. Do you think a raise was justified in Paul's situation? Explain.
2. What could have been done differently in the performance appraisal session?
3. What can be done now to change the situation?