# Standard Deviation in the Business World

Standard Deviation in the Business World

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Abstract On Standard Deviations in Job Performance

The purpose of this study was to compare the expected payoffs from personnel programs based on standard deviation of job performances in dollars, the Global Estimation model, and the CREPID procedure. The study was done for route salesmen of a large soft drink bottling company. The Global Estimation model and the CREPID procedure were behaviorally based, where the standard deviation of job performance was based on cost accounting data. The research study was based on whether selecting certain methods of behaviors for route salesmen would influence the expected monetary outcome of the selected behavior. The results could then be listed by the dollar payoff of the selected behavior. The hypothesis of the study was that using the standard deviation model would produce results that would measure cost accounting behavioral outcomes. There were three different methods used to gather information within the study. The Global Estimation model included using a questionnaire-based survey that would rate the value of a route salesman’s job performance. The CREPID procedure had two raters evaluating the salesman’s performance. The cost accounting method used sales records and performance results records to evaluate based on previous sales and delivery. The results of the study showed that the older, more experienced route salesmen had more influence on results than using any standard deviation cost accounting estimates of possible results. The Global Estimation method produced results similar to the standard deviation model showing that most of the dollar improvements were more directly related to the route salesmen and not the results of changing methodology. The CREPID method was found to be too subjective to be effective in this study. In striving to produce results that would establish job performance as a cost object, it failed to consider the personnel...

References: Greer, O. L., & Cascio, W. F. (1987). Is cost accounting the answer? comparison of two behaviorally based methods for estimating the standard deviation of job performance in dollars with a cost-accounting-based approach. Journal of Applied Psychology, 72(4), 588-595. doi:http://dx.doi.org/10.1037/0021-9010.72.4.588

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