Project Management Case Studies.

5th Edition

Harold Kerzner, P.H.D.

Photolite Corporation (B)

A meeting was held between Jesse Jaimeson, the director of personnel, and Ronald Ward, the wage and salary administrator. The purpose of the meeting was to discuss the grievances by the functional employees that Photolite's current employee evaluation procedures are inadequate for an organization that supports a project management structure.

Jesse Jaimeson: "Ron, we're having a lot of trouble with our functional employees over their evaluation procedures. The majority of the complaints stem from situations where the functional employee works closely with the project manager. If the functional manager does not track the work of this employee closely, then the functional manager must rely heavily upon the project manager for information during employee evaluation."

Ron Ward: "There aren't enough hours in a day for a functional manager to keep close tabs on all of his or her people, especially if those people are working in a project environment. Therefore, the functional manager will ask the project manager for evaluation information. This poses several problems. First, there are always situations where functional and project management disagree as to either direction or quality of work. The functional employee has a tendency of bending toward the individual who signs his or her promotion and evaluation form. This can alienate the project manager into recommending a poor evaluation regardless of how well the functional employee performs.

"In the second situation, the functional employee will spend most of this time working by her or himself, with very little contact with the project manager. In this case, the project manager tends to give an average evaluation, even if the employee's performance is superb. This could result from a situation where the employee has perhaps only a one to two week effort on a given project. This doesn't give that employee enough time to get to know anybody.

"In the third situation, the project manager allows personal feelings to influence his or her decision. A project manager who knows an employee personally might be tempted to give a strong or weak recommendation, regardless of the performance. When personalities influence the evaluation procedure, chaos usually results."

Jaimeson: "There's also a problem if the project manager makes an overly good recommendation to a functional manager. If the employee knows that he or she has received a good appraisal for work done on a given project, that employee feels that he or she should be given an above-average pay increase or possibly a promotion. Many times this puts severe pressure upon the functional manager. We have one functional manager here at Photolite who gives only average salary increases to employees who work a great deal of time on one project, perhaps away from view of the functional manager.

In this case, the functional manager claims that he cannot give the individual an above-average evaluation because he hasn't seen him enough. Of course, this is the responsibility of the functional manager. "We have another manager who refuses to give employees adequate compensation if they are attached to a project that could eventually grow into a product line. His rationale is that if the project grows big enough to become a product line, then the project will have its own cost center account and the employee will then be transferred to the new cost center. The functional manager thus reserves the best salary increases for those employees who he feels will stay in his department and make him look good."

Ward: "Last year we had a major confrontation on the Coral Project. The Coral Project manager took a grade 5 employee and gave him the responsibilities of a grade 7 employee. The grade 5 employee did an outstanding job and naturally expected a large salary increase or even a promotion. Unfortunately, the functional manager gave the employee an average evaluation and argued that the project manager had no right to give the employee this added responsibility without first checking with the functional manager. We're still trying to work this problem out. It could very easily happen again."

Jaimeson: "Ron, we have to develop a good procedure for evaluating our employees. I'm not sure if our current evaluation form is sufficient. Can we develop multiple evaluation forms, one for project personnel and another one for nonproject personnel?"

Ward: "That might really get us in trouble. Suppose we let each project man[1]ager fill out a project evaluation form for each functional employee who works more than, say, 60 hours on a given project. The forms are then given to the func[1]tional manager. Should the project manager fill out these forms at project termina[1]tion or when the employee is up for evaluation?"

Jaimeson: "It would have to be at project termination. If the evaluation were made when the employee is up for promotion and the employee is not promoted, then that employee might slack off on the job if he or she felt that the project manager rated him or her down. Of course, we could always show the employee the project evaluation sheets, but I'm not sure that this would be the wise thing to do. This could easily lead into a situation where every project manager would want to see these forms before staffing a project. Perhaps these forms should be solely for the functional manager's use."

Ward: "There are several problems with this form of evaluation. First, some of our functional employees work on three or four projects at the same time. This could be a problem if some of the evaluations are good while others are not. Some functional people are working on departmental projects and, therefore, would receive only one type of evaluation. And, of course, we have the people who charge to our overhead structure. They also would have one evaluation form."

Jaimeson: "You know, Ron, we have both exempt and nonexempt people charging to our projects. Should we have different evaluation forms for these people?"

Ward: "Probably so. Unfortunately, we're now using just one form for our exempt, nonexempt, technical, and managerial personnel. We're definitely going to have to change. The question is how to do it without disrupting the organization." Jaimeson: "I'm dumping this problem into your lap, Ron. I want you to develop an equitable way of evaluating our people here at Photolite Corporation, and I want you to develop the appropriate evaluation forms. Just remember one thingI do not want to open Pandora's box. We're having enough personnel problems as it is."

QUESTIONS (Kindly include references not more than 5 years ago)

1. Can a company effectively utilize multiple performance evaluation forms within an organization? What are the advantages and disadvantages?

2. If we use only one form, what information should be evaluated so as to be equitable to everyone?

3. If multiple evaluation forms are used, what information should go into the form filled out by the project manager?

4. What information can and cannot a project manager evaluate effectively? Could it depend on the project manager's educational background and experience