Performance Appraisal at Telespazio
1. Why has Telespazio adopted a double-rater system to evaluate the employees who work on projects on a regular basis?
Multi-rater systems usually involve multiple evaluations of a single employee from more than a single manager. When using a matrix model, the ambiguity and possibility of conflict increase because employees report to multiple managers. Matrix organizations such as Telespazio have multiple managerial responsibilities (Lauby, 2016). Thus, employees report to more than one boss. In Telespazio’s case, adopting a double-rater system was influenced by various elements. Firstly, the system would promote information sharing among all members of a project. Having to report to the project and functional managers demands extreme openness, especially between the two heads, to avoid conflict. To maintain a balance, sharing information is mandatory.
Secondly, sharing information develops intense transparency among the team members. Managers must keep each other informed and involve employees as well in the information loop for a seamless corporation. Thirdly, the system would encourage a cooperative definition of the goals for each project. Working together as a unit demands that all employees, subordinate and senior, have a uniform understanding of a project’s objectives. Fourthly, a joint understanding of the goals would lead the entire team to pay more attention to their roles and abilities while emphasizing the observable behaviors.
In addition, the approach would reduce the resources that are used to complete projects at the company. For instance, the staff members work on multiple projects, while managers oversee multiple projects. The efficiency in utilization of these resources is also remarkable when using a matrix model (Vantrappen & Wirtz, 2016). The process of sharing information improves the communication of all employees at various levels. The staff members utilize their skills more efficiently, which increases their motivation. The opportunity to improve skills also motivates employees further. As responsiveness increases, cooperation heightens, so do effective working tendencies (Stuckenbruck, 1979). Therefore, the system would improve the organization’s ability to achieve its goals that are associated with strategic change by ensuring that employees and the managerial team focus on the project’s goals and their achievement.
2. In a context where the company is evolving into a matrix organization, should Telespazio adopt a double-rater system, or should responsibility for performance appraisal be given to only one supervisor (e.g., the Business Unit Manager or the Country Manager)? What are the advantages and disadvantages of each approach?
Telespazio should adopt the double rater system for its employees’ appraisal. Its evolution into a matrix organization means that the employees will report to more than one boss. For this reason, it is only logical that the appraisal process includes the two managers who are involved.
The double rater system is ideal for Telespazio because it will encourage professional growth for the staff members. Feedback provided by both managers allows employees to improve themselves through talent development. For the feedback to be constructive, training is necessary. The availability of feedback from distinct levels of the organization informs employees more about themselves. Employees become self-aware and understand that success is much more than just satisfying goals, but also being a collaborator and meeting clients’ needs (Stuckenbruck, 1979). Therefore, the feedback is more holistic.
Unfortunately, the double-rater system is not suitable for all nations’ regulations. Since Telespazio is a global entity, it needs to ensure that the double-rater system aligns with the distinct cultural systems in the different countries of operation. This would ensure that the global mindset is right for implementation.
When such a company adopts an alternative approach where a single supervisor provides ratings, the possibility of bias is high because one supervisor may rate employees subjectively. This approach eliminates the objectivity that is required for successful projects and constructive feedback (Lauby, 2016). On the other hand, the appraisal from a single supervisor does not raise any confusion or ambiguity in diverse cultural settings because all participants understand the process and its purpose.
If a two-rater system were adopted, how would you allocate responsibility for the evaluation between the two managers?
The functional manager would provide support to the project manager. In this case, the project manager would analyze employees’ performance in all areas with the functional manager’s help. However, each of the two would be required to turn in independent reviews and ratings for each employee. Joint appraisals are necessary to achieve the maximum benefits of the double-rater system and promote all the initially stated reasons for its adoption at the company.
3. Why is the Telespazio HR team concerned about equity and the selectivity of managers’ evaluations? What actions would you suggest to improve managers’ rating skills?
Equity and selectivity of managers are crucial factors of a successful appraisal system. An effective performance management system cannot be overwhelmed by inaccuracy and subjectivity. A lack of equity can interfere with the company’s ability to maximize the benefits of the process or achieve the goals that initially motivated its adoption. Training is important for all managers to ensure that they understand the process. The training process should give them the necessary skills and knowledge to manage the appraisal process appropriately. Besides, Telespazio should adopt a guide that enables the managers to conduct the process more effectively; the guide should only have pointers to ensure that the process is not bound.
4. Which features of the PAT program contribute to strengthening the relationship between performance appraisal, training, and development? How does the appraisal system support Telespazio’s decision-making with respect to employee training and development?
The objectives feature is one of the elements that create a strong bond between appraisal, development, and training. The goals provide employees with a clear point of emphasis for an entire year. These objectives address an employee’s development needs and seek to enable all individuals to attain their development goals. This includes the acquisition of skills that are important for specific roles. The assessment of these objectives using the PAT system allows employees and supervisors to monitor the progress of employees. As a result, gaps are highlighted, which leads to achievement using different strategies that may include additional training. The training process then leads to the development of certain skills and competencies since it is a critical element of the PAT program.
The PAT system supports Telespazio’s training and development of employees by utilizing the process to enhance employee development. Once objectives are set, analyses that occur later in the year highlight skills gaps that need to be addressed. This leads to training, which utilizes the feedback provided by both managers, which improves the team’s skills and knowledge significantly. The result is greater efficiency in the achievement of goals and completion of projects.
5. Why didn’t Telespazio adopt a standard forced distribution method? Do you consider the decision to require managers to respect a maximum percentage (15%) of outstanding evaluations to be an effective way of improving the equity of the appraisal process?
The standard forced distribution method is not ideal for a company such as Telespazio, which intends to improve the skills and knowledge of most, if not all, of the employees. The forced method tends to deny innovative employees a chance to improve their skills and knowledge because they do not fall within the high performers category. It is also restricting for raters because they are limited to certain ratings, thus rigid. This rigidity discourages creativity in an organization. In most cases, creative people take risks, leading to a high number of failures in comparison to risk-averse individuals. Organizations that seek to benefit from employees’ innovativeness need to avoid the approach because it could drive away such individuals or stifle this especially essential element of an organization’s success.
The system incorporates forced visibility, which is unfair to some of the staff members. Visibility is more relevant to extroverted than introverted individuals. Therefore, if an employee fails to demonstrate behaviors that increase their visibility, they are likely to receive a low rating. This approach ignores the efforts that an individual may have exerted into a task and achieved the desired goal or exceeded expectations (Chattopadhayay & Ghosh, 2012). For this reason, Telespazio may lose excellent members of staff who may be uninterested in showing off their progress to colleagues. This may increase the company’s turnover rate, increase the recruitment costs, and affect the productivity and morale of employees, and the overall performance of the organization (Al Mamun & Hasan, 2017).
The decision to maintain a 15 percent maximum of outstanding performers will promote equity because it ensures that a substantial portion of the staff members keep improving their skills and knowledge to achieve this goal. This makes the cut a desire for all staff members and still provides development opportunities for all as they pursue the goal. It does not also segment employees based purely on their rankings. Instead, the integrated approach of appraisal ensures that few to none of the staff achieve this rating.
6. How does Telespazio plan to address the transfer of the appraisal system to its foreign subsidiaries? What strategies would you suggest to facilitate this process?
The other subsidiaries would utilize the appraisal program by 2014. The company first published the Telespazio Performance Appraisal for Development (TPAD) article on its intranet and distributed brochures to all its employees. Challenges are expected during the transfer process. To achieve a seamless transfer and adoption, the company should first hold a workshop that includes all managers from its global subsidiaries. This workshop should discuss the results from Argentina’s branch following the implementation of the program. The global managers should be invited to provide further insights about the program and encouraged to discuss it at length in their subsidiaries. Further, the program should be adapted to the different business cultures to ensure effectiveness and easier acceptance. However, customization should not change the program’s core elements.
References
Al Mamun , C. A., & Hasan, N. (2017). Factors affecting employee turnover and sound retention strategies in business organization: a conceptual view. Problems and Perspectives in Management, 15(1), 63-71. doi:10.21511/ppm.15(1).2017.06
Chattopadhayay, R., & Ghosh, A. K. (2012). Performance appraisal based on a forced distribution system: its drawbacks and remedies. International Journal of Productivity and Performance Management, 61(8).
Lauby, S. (2016). Multi-Rater Reviews: Advantages and Disadvantages.
Stuckenbruck, L. C. (1979). The Matrix Organization. Project Management Quarterly, 10(3), 21-33.
Vantrappen, H., & Wirtz, F. (2016). Making Matrix Organizations Actually Work. Harvard Business Review. Retrieved from https://hbr.org/2016/03/making-matrix-organizations-actually-work
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Question 
Performance Appraisal at Telespazio
Read the Case: “Performance Appraisal at Telespazio: Aligning Strategic Goals to People Development” and Answer the Questions Below
Access: https://hbsp.harvard.edu/import/851399
Case Study Questions:
1. Why has Telespazio adopted a double-rater system to evaluate the employees who work on projects on a regular basis?
2. In a context where the company is evolving into a matrix organization, should Telespazio adopt a double-rater system, or should responsibility for performance appraisal be given to only one supervisor (e.g., the Business Unit Manager or the Country Manager)? What are the advantages and disadvantages of each approach? If a two-rater system were adopted, how would you allocate responsibility for the evaluation between the two managers?
3. Why is the Telespazio HR team concerned about equity and the selectivity of managers’ evaluations? What actions would you suggest to improve managers’ rating skills?
4. Which features of the PAT program contribute to strengthening the relationship between performance appraisal, training, and development? How does the appraisal system support Telespazio’s decision-making with respect to employee training and development?
5. Why didn’t Telespazio adopt a standard forced distribution method? Do you consider the decision to require managers to respect a maximum percentage (15%) of outstanding evaluations to be an effective way of improving the equity of the appraisal process?
6. How does Telespazio plan to address the transfer of the appraisal system to its foreign subsidiaries? What strategies would you suggest to facilitate this process?
An acceptable case study analysis that includes sufficient critical thinking should be between 5-10 pages in length.