1 / 43

Performance Management: Linking Objectives for Organizational Success

This article discusses the purpose and features of performance management, including objective setting, performance planning, and reviewing. It emphasizes the importance of aligning individual and corporate objectives and creating a performance culture.

ralysha
Download Presentation

Performance Management: Linking Objectives for Organizational Success

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Mission Organization Strategy/Policy Objectives for Components of Organization (Quantitative, Qualitative) Job Purpose: Achieve Specific Outputs (Determined by Management) Accountability: Determine/Measure Outputs TOP-DOWN APPROACH Job Objectives Tasks

  2. A Definition for PM ”A management process designed to link the organization’s objectives with those of the individual in such a way as to ensure that both individual and corporate objectives are, as far as possible, met”

  3. Top-Down Approach - An Example: Cascading Objectives 1 2 3 4 5 6 7 8 9 10 11 12 .. Corporate objectives HR Div. Marketing Div. Finance Div. Production Div. Divisional objectives = Individual objectives of the Head of Div. 1 2 3 4 5 6 7... Individual objectives Executive 1 1 2 3 4 5... Executive 2 1 2 3 4 5... Executive 3 1 2 3 4 5... Executive 4 1 2 3 4 5...

  4. PM is NOT, • Performance Appraisal (only a part of PM) • Performance Related Pay (PRP) • Something done by HR Division (HR Division only does Process Initiation, Standards Monitoring and Record Maintenance)

  5. PM is NOT . . . ., • A ‘Magic Bullet’: Not the answer to all the Organization’s problems • An objective-setting process • A ‘Fashion’: Judgments must be based on sound and objective evaluations, and outputs must be ones that are desired and quantitatively and qualitatively at right level

  6. Purposes of PM • Ensuring individual performance is contributing to corporate objectives • Building procedures for employee development • Sustaining and improving employee motivation - by ‘Rewarding’

  7. Purposes of PM . . . . • To provide a sound basis for organization’s T&D plans for the future and for ‘Succession Planning’ • Correcting misunderstandings concerning performance expectations

  8. Developing a PM system • Identify performance dimensions • Select an appraisal instrument • Select sources of feedback/appraisal • Informal Interviews and continuous Coaching/Counseling • Performance Appraisal • Training & Rewarding

  9. Features of a Successful PM Process • Clear objectives and sound process for identifying, developing, measuring and reviewing them • Integration with corporate objectives (Top-Down Approach) • Greater clarity about Organization’s aspirations and objectives

  10. Features . . . . • Development of a ‘Performance Culture’: Results are given more recognition • Continuing dialogue between management and employees, and consequently a greater emphasis on individual development needs • Development of a more open and learning environment: A ‘Learning Culture’

  11. Features . . . . • Making things happen and achieve, rather than waiting for things to happen • Encouraging self-development

  12. PM Cycle Strategic Objectives Performance Planning Rewarding Managing Performance Reviewing Training, Career Development etc.

  13. Performance Planning Aim: Ensuring that people are not only doing things in the right way but, more importantly, that they are focused on the right things right way: Efficiency right things: Effectiveness

  14. Objective Setting ”An objective is a clear statement indicating how a particular output will be achieved in both quantitative and qualitative terms” SMART Objectives: Specific Measurable Achievable Realistic Time- bound

  15. Performance Planning . . . . • When the influence on an objective is high, motivation to achieve it is also high • Objectives must give some kind of a competitive advantage to the Organization, and have an impact on the direction and performance of the business, as far as possible • Objectives must align well with those set for other posts

  16. Performance Planning . . . . • Though Achievable, must be Stretching • Must be set in all important areas of the job • Must not be too numerous • Prioritiesshould be made clear among objectives • If outputs are not easily measurable, relate objectives more to Competencies

  17. Performance Planning . . . . • Individual Development must be ensured • Necessary support must be provided by the Superior once objectives are set • Qualitative and Developmental aspects must not be neglected. Hence any PM scheme must have a mix of, • Quantifiable Outputs • Behaviorally-based Competencies

  18. Performance Planning . . . . • Certain jobs may have outputs which are, • Not directly related to Org. outputs • Difficult to be defined and / or measured • Opt for • Behaviorally-based Competencies

  19. Performance Planning . . . . But . . . . Behaviorally-based Competencies must • Be able to be assessed objectively • Be relevant to the job • Have a common core for jobs operating in the same environment-common standards • Not be too numerous

  20. Subjective Vs Objective Criteria Subjective Objective • Depends on the person • Independent of the person • Qualitative • Quantitative • Comparative • Absolute • Approximate • Exact • Cannot be defended • Can be defended

  21. Managing Performance Giving employees the necessary support and creating appropriate conditions for them to be able to deliver the required results, in effect empowering them – A Management Style to develop a ‘Performance Culture’

  22. Managing Performance . . . . • Practically, • Providing appropriate resources etc. • Advice and clarification to make required results clear • Training & Development (T&D) • Adjusting targets, priorities and performance measures as per Org. priorities, markets, government policies etc.

  23. Managing Performance . . . . • Must take responsibility for one’s own performance - Managers in particular to show by example • Management Style will depend on, • Personality of individual • Nature of task • Time-scale • Organization culture

  24. Managing Performance.... • Most effective Management Style is likely to, • Empower individuals to take decisions that are within their competence • Gives all necessary support and encouragement (Coaching/Development) • Have the option held in reserve of becoming more directive, if needed

  25. Reviewing Performance • Formal appraisal interviews should not contain surprises - regular feedback from supervisor • Every employee has a right to know how he/she performs • Employees must be encouraged to give their opinions on their own performance

  26. Reviewing Performance . . . . • Formal appraisal interviews must focus on Targets set and Achievements made against them • Appraiser must listen to the appraisee A constructive and supportive process that gives advice to help individual development

  27. Formal Appraisal - A few tips • Create a relaxed atmosphere • Inform well in advance • Start casually and ask open ended questions • Be specific if necessary • Ensure that you cover all the areas • Praise for work well done

  28. Formal Appraisal-A few tips . . . . • Indicate areas for improvement clearly • Demonstrate how to improve and encourage • Discuss training needs and development • Set action plans • Summarize • End on a positive note

  29. Informal Interviews • Should be on-going • regularly tell people what they need to start, stop and change • Allows problems to be ‘caught’ early • Employees See that their efforts are being noticed • Minimizes ‘surprises’ in the Formal Interview

  30. Informal Interviews can be . . . . • Informal chats • Monthly meetings • Lunch-hour discussions • Progress reviews • Addressing emerged issues

  31. How can interviews go wrong..? • Use of only one rater • No opportunity for self-rating • No appeal system • Lack of rater training • Superiors reluctant to devote sufficient time for appraisals • Poor communication skills

  32. Rater (Appraiser) Options • Superiors • Peers • Subordinates (Reverse Appraisal) • Customers • Self Must be knowledgeable of the Person and the Job….!

  33. 360-Degree Feedback Appraisal • A PM process which includes appraisals by, • Superiors • Peers • Subordinates • Customers and • Self • Gives a total picture of performance

  34. Judging Performance • Performance must be judged against overall objectives • Objects have to be quantifiable as far as possible • Competencies must be described carefully in the form of demonstrable skills or behaviors that can be assessed objectively

  35. Judging Performance. . . . • Careful account has to be taken of the circumstances in which targets/objectives achieved - Internal and External factors • Every aspect of the job must be focused on as a whole - no undue influence by extremes of performance in one part of it • Emphasis has to be placed on ‘Priority Objectives’ • Avoid ‘Rater Errors’

  36. What are ‘Rater Errors’....? • Unclear standards • ‘HALO’/‘HORNS’ effects • Central Tendency • Leniency/Strictness • Bias • Recency error

  37. Three ways to avoid . . . . ! • Understand issues from the side of employees • Choose the right appraisal tool • Train Raters/Appraisers

  38. Training and Rewards • Arrange appropriate training • Implement procedures for controlling • Rewarding and Recognition

  39. Rewarding Performance Reward:Return for achieving targets/objectives - Not only financial but can be praise, greater opportunities for T&D and promotion also

  40. Employee motivation - rewards are related to efforts • Increase of employee focus and commitment to corporate objectives • Development of a ‘Performance Culture’, reinforcing existing one • Rewarding individual contribution Objectives of PRP

  41. To recruit and retain high quality staff • Ensuring rewards are in line with Organizational performance • Higher reward for greater contribution • Encouraging individual and team performance Objectives of PRP . . . .

  42. Old and Modern PM systems - A Comparison Old Modern Objectives are imposed on the individual by his/her boss Objectives are mutually agreed upon by the superior and the subordinate Once the objectives are set they are fixed for the next year Objectives can be subsequently modified/new objectives can be introduced depending on the dynamics of the environment An individual’s performance is measured within a framework of fixed systems and processes An individual’s performance is measured based not merely on the results but also on his/her contribution for improvement

  43. Tomorrow . . . . A culture nurturing organizational growth and individual development . . . . Thank you . . . . Upul Herath Manpower Planning Section

More Related