Effects on Performance Management

Effects on Performance Management and the Company when Nepotism and Cronyism is Present. Cronyism is Present. Whether deliberate or unintentional, workplace nepotism and cronyism threatens positive corporate culture as well as the company's overall performance management. Managers who give special treatment to their family members or their favorites decrease the morale of the other employees and do not pay attention to the areas of need that the employee may be facing in their Job performance.

Finding yourself on the non-receiving end of desirable assignments can be rough-?especially when the recipient also lacks adequate employment lubrications. The organization being discussed is a relatively small organization; there are approximately twenty full-time employees and seventeen part-time employees. The organization serves adults with developmental disabilities on cite and in the community. They are a non-profit organization and rely on state funded money as well as fundraisers.

Their performance evaluation they work with does not have any weight when considering raises or pay scale. There have been two directors in the last ten years and both directors suffered from performance management issues. However, since the latest director has been in charge the organizational culture is also changing rapidly. The previous director hired her daughter and the daughter's best friend. When both were hired neither had the required skills to perform their duties. They both rapidly moved up the ladder of success during the director's time.

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A couple of years prior to the director's retirement an "assistant director" position was created to train the upcoming replacement. She also happened to be a family friend. This friend had experience as a support coordinator and some college experience. After the new director took over, the entire center seemed to be recreated. The "daughter" was made a program manager and the "friend" was made a program manager. Once these positions were filled and time went on, cronyism became very visible among the center staff.

The "daughter" had now been moved into an "invented position" since she was unable to perform her managerial duties, as told to staff, yet her salary and status seemed to remain intact. The "friend" however seemed to shine brighter daily and chain of command communicated regularly. The morale of the organization started falling and stories and complaints traveled quickly between staff. It was starting to be evident that the word "team" did not exist. If rooms needed assistance, coverage, or other types of conflict arose there was not anyone to come and offer support.

The staff knew they had to call the program manager per chain of command but she was never available. After months of back and forth from trying to get answers from the director and when questioned, the program manager, who also happens to have tightened the bond of friendship with this director would lie and say it is handled or Just not show up when needed the staff began feeling like no matter how much they complained or tried fixing the situation the director valued the friendships more than the organizations culture all together.

Every year when it is time to do performance evaluations the direct support staff would cringe. They all knew that no matter what was on the form that they signed it did not matter because "if" there was a raise to be given, it would be a standard 1%-3% across the board. The facts that the "mangers" actually had a larger salary increased their raises due to the percentage factor.

This past year most staff filled out their own evaluations and wrote their own goal to work towards the following year and the managers Just signed off and passed to the director. The character of cronyism is proactive and dynamic. Goanna (1991) notes that loyalty has two true-hearted dimensions: emotional and behavioral. The emotional aspect of loyalty results from gratitude. Since emotions are invisible, one's loyalty is evaluated through the behavioral dimension.

In situations where loyalty is a highly valued characteristic, individuals tend to display loyal behaviors in order to receive positive evaluations and personal benefits, in this case no consequences for not being supportive to the program staff or not being held accountable for her lack of performance. Additionally, it may not be easy to distinguish between behaviors hat emerge from true-hearted gratitude and behaviors that result purely from "impression management. " That is why this definition of cronyism is based on the notion of perceived loyalty.

The lower ranked employees are likely to play an active role. For instance, a program staff may want to influence the perception her supervisor by uncritically agreeing with the program manager on work or non-work related issues or by speaking highly of that program manager in the presence of the director of the center. (Deluge and Perry, 1994). This perceived loyalty plays a major factor when the yearly evaluations roll around. Since there is not clear Job descriptions or expectations in any area of the organization there would not be anything to effectively measure or evaluate.

Popularity or convenience plays more of a role. When the evaluations rotate through the managers, they have many other things that rank higher in priority so it is usually rushed through and passed back to the director to file. In a healthy organizational culture personal relationships and loyalty, to a certain degree, may be functional and does not necessarily breed cronyism. Coffee and Jones (1996), argue that sociability, which refers to sincere approachability among members f an organization, raises morale, fosters teamwork, and promotes creativity.

However, when the stress on relationships is so great that it is turned into strong in- group bias and when loyalty becomes unreserved, cronyism is likely to occur. There is a more complex system of social interactions that arise spontaneously as people associate with one another. Dissimilar to the formal structure, which accentuates official positions in terms of authority and responsibility, the informal structure emphasizes people and their unofficial relationships (Newsroom and Davis, 1993).

The informal system develops to fulfill needs that cannot be met by the formal system. Increasing informal relationships with the right people, which may include subordinates, peers, and superiors, can be a useful means of acquiring power Nouns, 1992). The coupled relationship between the superior and subordinate in the context of cronyism tends to be governed by their personal ties rather than assigned Job duties or responsibilities.

These casual relationships may override organizational hierarchy and involve an element of "power-seeking," where individuals exchange ore than friendship among themselves to further individual goals that cannot be met through formal channels. Studies suggest that the mere act of categorizing people as "cliques" and out-groups have a tendency to result in favoritism (Teasel et al. , 1971; Turner et al. , 1983). Clique members are given high levels of trust, interaction, support and rewards while out-group members receive low levels of each and often denied valuable opportunities (Vehicle, 1997).

These behaviors breed a competition among the staff that creates stress among the employees since they hank that if they are not a member of that clique or friendship they may not get any of the "rewards" they feel those clique members receive. Some examples of this description within the organization is when an instructor, someone with no authority, brings gifts or constantly offering flattering compliments to feel as though she is in the "clique" status and when an opportunity arises like a special outing or work opportunity that is praise worthy she usually gets it.

The opposite end of the spectrum however is the employee that constantly goes above and beyond her jugular Job duties to help others and seems knowledgeable of her position gets constantly overlooked for promotions, raises, or passed by because she chooses to focus more in her Job rather than the social side of relationships. Personal loyalty toward the program manager or director is different from loyalty to the organization or organizational commitment.

The director or program manager's cronies may not be committed to the organization as a whole. In fact, the increase of a deep sense of obligation toward the director or program manager may surpass connection toward the organization (Chem. and Francesco, 2000). An example could be that if the director leaves the organization, her cronies will try to follow suit. Being trusted supporters, "clique" members of a work unit tend to cultivate a feeling of gratitude towards the program manager or director.

These same employees are likely to be pleased with their work due to the existence of receptive bonds in their working relationships. These same employees shared motivational factors and experienced less role-related stress like Job overload, insufficiency, ambiguity, or conflict. Unfortunately, out-group employees who do not possess these same connections seem to have lower Job distraction because even if they are the "cream of the crop," their chances of climbing the ladder of success are slim.

This has an antagonistic impact on their sense of self-worth as they become trapped in organizations that require friendships to "earn" promotions (Hurley et al. , 1997). This reason alone should be evidence enough that performance evaluations should be considered more serious than they are in this particular company. They are likely to feel a sense of inequality when they perceive that in-group members, regardless of competency, manage to be promoted much faster than they do.

It is not surprising to find that out-group members are more likely to file grievances (Coleman et al. , 1993). The clique group of employees is likely to show low commitment to the organization. This is where prominence on loyalty to the director or manager may transform into negative organizational performance when the directors personal goals struggle with those of the organization. Although cultural influence plays an important part here, the practice of cronyism, with its stress on loyalty toward management rather than the organization, greatly emphasizes such influence.

When the company's strategic plan ND evaluation standards are stated to be practiced one way in the personnel handbook and the actual actions of the management staff proves otherwise the staff could view that situation as an opportunity to slack on their personal performance and not care whether or not the company actual succeeds or not. Obligation is related to organizational dependability or the degree to which an organization is perceived to be looking after the interests of its employees in practices such as Job security and career development (Buchanan, 1974; Steers, 1977).

Due to in-group bias, the hard work of out-group members is often unrecognized by their previous. Furthermore, out-group members do not experience the Job security and preferred rewards in-group members enjoy. They are often overlooked in terms of opportunities for personal achievement. While in-group members are delegated key roles in the organization, and the out-group members are merely assigned peripheral functions that are easily expendable (Change, 1999).

Ingratiation, an attempt by individuals to increase their attractiveness in the eyes of others, is one particular rising influence strategy whereby ingratiation behaviors are driven by attempts to influence someone higher in the formal hierarchy of an organization Porter et al. , 1983). Loyalty is adored in cronyism; employees may openly reaffirm the manager's views and defend her appearance and prestige. They may also acknowledge the power distance in the hierarchy ladder and show their submissiveness in order to win the manager or directors heart (Fisher, 1977).

The noticeable benefit associated with the in-group status encourages ingratiation behaviors. In addition to having impacts on individuals working in an organization, it can also greatly impact the clientele the organization serves; cronyism also produces significant consequences at the group or organizational level. Personal feelings can seriously bias Judgment. Positive affect toward employees makes managers less likely to give them negative performance feedback. With this being said, incompetence among in-group members has a tendency to be hidden and covered up in the organization.

Since in-group members are rewarded on the basis of loyalty rather than competence, they do not see the need to excel and may at best achieve average performance. Additionally, these same employees tend to channel their energy and attention to ingratiating themselves with the manager or director or other related political behaviors. This ultimately distracts the employee from completing their proper Job duties (Coffee and Jones, 1996). Talent, which would otherwise rise to the top, is blocked and stifled by lack of opportunity. This leads to talented people leaving the organization.

The constant leeching away of talent inevitably weakens the strength of the organization (Redding and Whish, 1993). Finally, the quality of decision making is a victim of cronyism. Any leader who is surrounded by "yes men" is unable to benefit from the diverse perspectives, experience, and knowledge of their employees. Worse still, with stress on conformity, ideas are unlikely to be fined and improved through group discussion and debate. The result of having such differentiated treatment can cause hostility between the two groups, consequently harmfully affecting their cooperation and sense of teamwork.

Progressively, the relation between the in-group and out-group employees suffers as the unjustified practices continue, and the leader's cronies are perceived to be getting more benefits than deserved (You kill, 1994). Over time, the morale of the out- group will be eroded by their feelings of alienation, powerlessness, and inequity as favoritism of in-group employees renders the relationship between performance and reward less obvious (Preponderates and Topple, 1996). Cronyism stems from the fact that management is able to manipulate rewards and punishments for their employees.

The greater their ability to do so, the greater is the personal dependence of employees on them. Missies, (1998) maintains that favored "clique" treatment may be reduced by making evaluation criteria explicit, objective, and public. To sum up, presence of competent managers and directors are likely to reduce crony behaviors. It is instinctual that competent managers tend to reward and promote competency among their employees. But, incompetent managers and directors would feel heartened by competent employees, and inevitably drive away competent employees (Bodleian and Ramekins, 1998).

Preponderates (1993) notes that "yes men" tend to be concentrated among less able workers and among workers with less able managers. In conclusion, the organizational problem of nepotism eventually stemmed to accepted cronyism. By management allowing this to take place the employees began feeling resentment and the organizations moral dropped dramatically. In this particular organization, the clientele are the main ones affected by these behaviors to take place.

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