Employee Selection and Performance Measurement in Microsoft Corporation - Literature review Example

Employee Selection and Performance Measurement Report November 6, Table of Contents Executive Summary I Introduction 2 Processes Used for Employee Selection and Performance Measurement in Microsoft Corporation 2.1 Validity and Reliability of Interviews, Tests and Other Selection Procedures: 2.2 Methods Used Pose Any Ethical, Legal, Practical Issues Creating Problems for Managers and the Organization 2.3 Methods Might Need to be Adjusted Given the Increasingly Diverse, Multicultural and Geographical Dispersed Workforce 2.4 Performance Appraisal Program 2.4.1 Formally or informally Applied 2.4.2 Articulated and Well Communicated Goals for the Appraisal 2.4.3 Relationship Between Strategic Goals of Microsoft and Standards Used for Evaluating Individual Performance 2.4.4 Evaluator 4 Identification of Strengths and Areas that Needs Improvement 5 Conclusion and Recommendations 6 Reflections References Executive Summary This report aims to examine the selection and performance appraisal program employed in Microsoft Corporation. As of 2011, Microsoft employees 90,000 individuals around the globe. In the knowledge economy the competitive advantage of a business is its human resources. Therfore, Microsoft uses the content and construct validity approaches to select the most suitable applicants for a particular job. Microsoft conducts a thorough background check of each employee that it recruits. It does not employ discrimination in selection process as it uses the person-organization fit approach. Thus, it ensures that it is free from any legal or ethical issues that may arise from its human resource management activities. Furthermore, it fully ensures that all its online and offline interview questions are designed in a legal manner that encourage diversity in its workplace. Microsoft’s policies are designed in a way that they ensure that human resource activities including employee appraisal programs are employee friendly. I Introduction In the knowledge economy the competitive advantage of a business is its human resources. This increases the challenges posed to the organizations to be selective and open minded in making their decisions regarding recruitment of employees and forming their strategies for their selection processes, choosing the most effective and relevant performance appraisal method and compensating and rewarding the employees accordingly. Both employee selection and their performance appraisal plays a critical role in the organizational productivity and profitability. The selection phase determines the right employees for the right job and performance appraisals determine their loyalty and therefore, retention in the organization for a long period of time. This report aims to examine the selection and performance appraisal program employed in Microsoft Corporation. I am familiar with the processes through which the employees are selected and their performance is measured in Microsoft Corp. Headquartered in Washington, USA, Microsoft is an American based Multinational Company having offices worldwide. It operates in a diverse range of industries including computer software, consumer electronics, digital distribution, computer hardware IT consulting, video games, online advertising, retail stores and automotive software. As of 2011, Microsoft employees 90,000 individuals around the globe. The report will conduct a literature review of the existing literature available on employee selection, performance appraisal methods used in practice and their legal or ethical implications. The report will next examine these practices in Microsoft Corporation and investigate strengths and any weaknesses existing in the current practice of the organization. In the end, the report will provide preliminary recommendations based on the analysis and provide a reflection of the study. 2 Processes Used for Employee Selection and Performance Measurement in Microsoft Corporation Bohlander, Carson and Kinicki (1992) argued that there is a misunderstanding in the world among the personnel management practitioners as well as theorists that the activities of human resource management have a positive impact on the attitudes of employees. They conducted a research and tested the hypothesis that the human resource activities of an organization negatively affects their employees commitment and productivity. Their study supported this hypothesis. Microsoft Corporation is the leading operating service provider in the world. In order to remain competitive in the global marketplace and to maintain its top position in the computers industry, Microsoft has to adopt efficient and effective selection and appraisal procedures. Furthermore, to ensure that its selection procedures and all human resource management activities have positive implications on its employees, it has adopted a sound selection and appraisal policies that encourage people from all races and countries to join Microsoft and contribute towards its success. 2.1 Validity and Reliability of Interviews, Tests and Other Selection Procedures: Bohlander and Snell (2007) highlights that the selection process is usually an ongoing process in the organizations which includes the application submission and filling of the applicant’s forms and cover letters. In practice, some organizations “determines the relationship between predictor data of test scores and criterion data” (p. 258). This approach is referred to as criterion-related approach. They argued that in order to check the validity and reliability of the data, two or more data sets are tested by using the right formula. For instance, the biological data and the interview data can be combined to achieve more effective selection answers. However, in cases where the criterion-related approach is not feasible, Bohlander and Snell (2007) provides that they can adopt the content validity approach to resolve the matter. This approach takes into consideration the job description and the applicant’s skills and experience. Another approach to the validity of the selection process is construct validity. Bohlander and Snell (2007) postulates that this particular approach is used to analyze the discreet behaviors of an individual like intelligence, anxiety, mechanical and comprehension. Microsoft uses the content and construct validity approaches to select the most suitable applicants for a particular job. The rationale for the adoption of a combination of these approaches is the benefit of each and their feasibility in order to find the right applicant. Once the shortlisted candidates are identified, it conducts three tier interviews. Each tier has a team of interviewers who examine the human capital through different perspectives integral to the job. The applicant has to go through each tier upon selection and move to the third top tier. Once cleared, the applicant is hired. 2.2 Methods Used Pose Any Ethical, Legal, Practical Issues Creating Problems for Managers and the Organization Bohlander and Snell (2007) in their book titled Managing Human Resources argues that the major goal of selection of human resource is to maximize the number of ‘hits’ and to minimize the number of ‘miss’ (p. 254). The hits are those instances where the employee selected is the right person for the right job. On the contrary, the misses show that the employee who was refused selection was the right person for the right job. Bohlander and Snell (2007) also highlighted that to reduce the interviewer’s discrimination, one has to adopt the person-organization fit approach. This approach postulates that the questions should be designed in a manner that the person is judged according to the detailed job description and required skills-set. Thus, reducing any spaces to encourage the interviewer to employ his/her own mindset in the selection process. Myors, et. al. (2008) studied the legal aspects of selecting employees from the perspective of 22 countries. They found that in a diverse workplace racial, ethnic or religious subgroups are hired to keep the organization attractive to all types of employees. However, where the organization considers it disadvantage to hire racial, ethical or religious subgroups and if hired are involved in discrimination practices whilst conducting employee job appraisal are in violation of the employment laws. They argued that such "preferential treatments" are not permitted and individuals should be given a job if they are eligible for it regardless of their creed, disability,or ethnicity. Bohlander and Snell (2007) highlights that background checking of a potential employee is critical for an organization. In case the organization has avoided checking the individuals background and that individual has harmed any person during the work hours, the organization becomes liable for negligent hiring (p. 263). In this regard, Microsoft conducts a thorough background check of each employee that it recruits. Furthermore, it does not employ discrimination in selection process as it uses the person-organization fit approach. Thus, it ensures that it is free from any legal or ethical issues that may arise from its human resource management activities. 2.2.1 Identification of any Legal and Ethical Issues Fugate, Prussia and Kinicki (2010) postulated that performance appraisal has been largely related to threat appraisals instead of encouragement ones. They examined the factors and the outcomes of these threat appraisals on the employees performance and productivity. They argued that "positive change orientation and change-related fairness" are considered as the least contributors of threat like appraisals. The positive change orientation includes self-efficacy change and their visualized control. Whereas, the absenteeism and voluntarily quitting acts are directly related to the threat appraisals. As a result, the employees show their discouraged morale through increasing acts of absenteeism and voluntarily quitting the organization. Microsoft’s selection procedures are ethically and legally clear in terms of their design, validity and construct. 2.3 Methods Might Need to be Adjusted Given the Increasingly Diverse, Multicultural and Geographical Dispersed Workforce Bohlandar and Snell (2007) highlighted that for diversity management one has to ensure that the questions that are devised for the interview are all legally clear. For instant, there should not be any use of discriminated or prejudiced questions that give a preferential or negative notion to the potential applicant. Furthermore, in cases where discriminated questions are used to drive out the racial applicants, the organization would be liable for discrimination and illegal content. Schuler and Jackson (2010) argued that "talent has become the key word in the global business" (p.215). The recent worldwide economic growth has contributed to the competitions of retaining employees in developed countries. There is increasing voluntary switch over of the employees to attractive workplaces providing training and development to the human resources. However, this has proved increasingly challenging for the multinational companies to retain their top talented employees. Singh, Sharma and Cheema (2011) argued that it is the process through which decision making and information gathering is connected in an organization. This connection forms the judgment criteria for the personnel selection, training, development and compensation decisions. Chi, Freeman and Kleiner (2011) argued that labor practices in the United States manufacturing establishments and the recently popular innovations in human resource management like employee involvement programs, total quality management have been largely terminated by these establishments due to their non-linkage with the organizational settings and goals. The employee involvement programs are designed to encourage productivity and overall profits of the organization. However, they hardly assist the organization in decision making for the selection and appraisal of the personnel. Microsoft in this regard fully ensures that all its online and offline interview questions are designed in a legal manner that encourage diversity in its workplace instead of prejudice environment. Microsoft ensures that it has a wide variety of people on its board who share their expertise, experience and knowledge in achieving its organizational goals. 2.4 Performance Appraisal Program Jafari, Bourouni and Amiri (2009) advocated that performance appraisal has financial and performance of the organizations human resource management. They found that there are numerous methods to appraise employees in an organization and none of them can individually or solely claim to have an integrated approach to the appraisal of performance. Thus, the authors postulate that the human resource managers are at the liberty to choose the method that suits well to their needs and can provide efficient results for their organization. Jafari, Bourouni and Amiri (2009) have proposed a framework to help the human resource managers in selecting the most appropriate and effective employee appraisal method and also a method to compare these appraisals for the future selection, recruitment, training and development decision makings of the organization. Microsoft’s policies are designed in a way that they ensure that human resource activities including employee appraisal programs are employee friendly. They have developed self evaluation programs that encourage employees to take and benefit from through the rewards and bonuses offered to each of them. 2.4.1 Formally or informally Applied According to Bohlander and Snell (2007) the appraisal program can either be formal or informally applied to achieve the effective results. In this regard, Microsoft’s appraisal program is formally applied. 2.4.2 Articulated and Well Communicated Goals for the Appraisal Microsoft’s goal is to become the largest and most demanding manufacturer of computer related equipments, software, video games, and operating system. This goal is well communicated in its appraisal program like it is identified in its appraisal that the employees have are encouraged to take the self evaluation test to meet the expectations of their employer to achieve the organizational goal. 2.4.3 Relationship Between Strategic Goals of Microsoft and Standards Used for Evaluating Individual Performance The relationship between strategic goals of Microsoft and the standards used for the evaluation of individual performance is positive. 2.4.4 Evaluator The team leaders of each team conduct the employee appraisal programs. There is a self evaluation program in Microsoft which allows individuals to take their self tests and evaluate themselves. 4 Identification of Strengths and Areas that Needs Improvement The primary strengths of the selection and performance appraisal program used in Microsoft are (1) Increase in employee motivation, (2) Increase in employee satisfaction, (3) Highly motivated employees, (4) Greater attractiveness of the company, (5) Low voluntary turnover and absenteeism, and (6) Competitive Advantage. This method encourage the organizations ability to foster diversity and operate effectively in a multicultural global marketplace. With positive relationship between the employee’s retention and the performance appraisal program, Microsoft has developed a strong ability to manage its diversity effectively. 5 Conclusion and Recommendations Selection and performance appraisal programs of Microsoft are valid and legally unobjectionable. It has adopted the standards of measuring individual performance in its practice to ensure diversity in its workplace and high employee loyalty. However, for further effectiveness, it is recommended that it adopts a unified policy for its selection criterion as well as performance appraisal to ensure that there is uniformity in the activity. Most importantly, the human resource activities of Microsoft are in conjunction with Bohlander and Snell’s recommendations. 6 Reflections The report forms as the information guide for the leaders and the human resource managers in the organizations to develop their selection and performance appraisal programs in the manner which Microsoft Corporation has formed. References Bohlander, G.W., Kinicki, A.J., Carson, K.P., (1992). Relationship between an organizations actual human resource efforts and employee attitudes. Group Organization Management, Vol. 17, No. 2, pp. 135-152. Retrieved November 6, 2011 from http://gom.sagepub.com/content/17/2/135.short Bohlander, G.W., & Snell, S., (2007). Managing Human Resources. Thomson.14 Edition. Retrieved November 6, 2011 from http://books.google.com.pk/books?hl=en&lr=&id=DoOVPc2QlXsC&oi=fnd&pg=PR3&dq=methods+of+employee+appraisal+program+Bohlander&ots=cowRhLP7p1&sig=_otzreO3fzvlhdW7P_jMv-jzlYM#v=onepage&q&f=false Chi, W., Freeman, R.B., & Kleiner, M.M., (2011). Adoption and Termination of Employee Involvement Programs. Labour, Vol. 25, Issue 1, pages 45-62. Retrieved November 6, 2011 from http://onlinelibrary.wiley.com/doi/10.1111/j.1467-9914.2010.00510.x/full Fugate, M., Prussia, G.E., & Kinicki, A.J., (2010). Managing employee withdrawal during organizational change: The role of threat appraisal. Journa of Management. Retrieved November 6, 2011 from http://jom.sagepub.com/content/early/2010/01/29/0149206309352881.abstract Jafari, M., Bourouni, A., & Amiri, R.H.,(2009). A new framework for selection of the best performance appraisal method. European Journal of Social Sciences, Vol. 7, No. 3. Retrieved November 7, 2011 from http://webpages.iust.ac.ir/amiri/papers/A%20New%20Framework%20for%20Selection%20of%20the%20Best%20Performance.pdf Manoharan, T.R., Muralidharan, C., & Deshmukh, S.G., (2009). Employee Performance appraisal using data envelopment analysis: A case study. Research and Practice in Human Resource Management, Vol. 17, Issue 1. Retrieved November 6, 2011 from http://www.freepatentsonline.com/article/Research-Practice-in-Human-Resource/206535860.html Myors, B., & et.al., (2008). International Perspectives on the Legal Environment for Selection. Industrial and Organizational Psychology, Vol. 1, Issue 2, pages 206-246. Retrieved November 6, 2011 from http://onlinelibrary.wiley.com/doi/10.1111/j.1754-9434.2008.00040.x/full Schuler, R.S., & Jackson, S.E., (2010). HRM and Multinational Companies: Global Talent Challenges and Global Talent Management, Part 5, pages 215-227. Retrieved November 6, 2011 from http://www.springerlink.com/content/jht77p2467823413/ Singh, S., Sharma, G.D., & Cheema, H.D., (2011). A Study of effect of performance appraisal on the organization and the employee. SSRN. Retrieved November 6, 2011 from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1852017 Read More