1. [PERFORMANCE MANAGEMENT] October 20, 2011
School of Business and Law
Assignment
On
Performance Management
Name Md. Kamal Hossain
ID B0687MHMH0411
Semester MBA1
Group C
Module Managing Human Capital
Lecturer David Hall and Rajendra Kumar.
Due Date 20th October 2011
WORD LIMIT: APPROXIMATELY 3000
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Table of content:
1.0. Introduction……………………………………………………………………………………..04
2.0. Objective of performance management……………………………………………………..04
3.0. Principles of developing a performance management plan……………………………….05
4.0. Process of performance management:……………………………………………………...05
4.1. Planning………………………………………………………………………………..05
4.2. Monitoring………………………………………………………………………………05
4.3. Developing……………………………………………………………………………..05
4.4. Rating…………………………………………………………………………………..05
4.5. Rewarding……………………………………….……………………………………..05
5.0. Literature review………………………………………………………………………………..06
6.0. Example and critical analysis…………………………………………………………………07
6.1. Example:……………………………………………………………………………….07
6.1.1. LIoyds TSB………………………………………………………………….08
6.1.2. ASDA………………………………………………………………………..08
6.1.3. KFC…………………………………………………………………………..08
6.1.4. McDonalds…………………………………………………………………..09
6.1.4.1. Individual performance plan……………………………………09
6.1.4.2. Individual development plans…………………………………..09
6.1.4.3. Annual measurement…………………………………………...09
6.1.4.4. Performance calibration seminar………………………………09
6.1.5. International Retailer……………………………………………………....10
6.1.6. Dell……………………………………………………………………………………10
6.1.7. Ford‟s…………………………………………………………………………………10
6.1.8. Inter Continental Hotel Group (IHG):………………..………………..…...10
6.1.9. Marks and Spencer‟s……………………………………………………………….10
6.1.10. Unilever……………………………………………………………………………..11
6.1.11. Motorola…………………………………………………………………………….11
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7.0. Conclusion………………………………………………………………………………………11
8.0. REFERENCES and BIBLIOGRAPHY………………………………………………………12
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1.0. Introduction: In the real world, we could not won our employer's goal successfully,
except being supervised, developed in any mode. Without any information, monitoring,
guidance and control employees would not do their job that our company wants. In addition,
company needs to know what their employees‟ performances are. Are they doing well? Are
their employees on the right track or the company can make their job perfect way? For
maintain all this issue company need some kind of system. Performance management is the
one of process for companies to measure their employees' ability to gain their goal.
In 1980s, “performance appraisal” had replaced by the phrase “Performance Management”.
As a number of drawbacks, the business organization focused on performance
management. Performance management is, an analyst may view the performance of the
whole company and measure the business value. In another intellect Performance
management is the process for evaluating the member of staff to attain in the concern
objective. The transform is essential things to continue in a competitive market. For the
transform, performance management can help the business what is obligatory to improve by
the business. By the performance management, workers and managers can get together for
sharing their individual opinion, and then their manager can choose the best opinion to make
their aim structure to reach there. The measurement of employee performance is one of the
most important way for any business organisation to toward their business goal.
Performance management is a system where the management measures the workers'
performance.
Performance management allows a business to characterize planned goals, assess, and
supervise performance along the goal.
Performance management systems involved number of activities; they are more than simply
review what an employee has done. Several of years ago, performance valuation was
designed primarily to tell the employees how they had done over the period and let them
know what they would be getting. This was mechanism implies. Specifically performance
valuation should also address documentation concern. Performance management must
convey to employees how well they perform towards specific goals.
2.0. Objective of performance management:
1. Build up the relationship between management and employee.
2. Simplify the task, purpose, errands, priorities and prospect.
3. Recognize and tenacity the performance difficulty.
4. Give a necessary for management assessment such as promotion, succession.
5. Recognize excellent performance.
6. Generate and continue the reasonable stage of the act.
7. Give the employee a strong growth and development in their task.
3.0. Principles of developing a performance management plan:
1. Performance management measured a process not an event.
2. It is a major communication way.
3. Any way of process for a specific job should be specific.
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4. Official recognition: the process of creating a paper trail to record data.
5. Objective or result: report of what an employee is supposed to attain.
6. Ongoing performance communication: no surprises.
7. Performance review: refers to a meeting to review and evaluating performance.
8. Performance appraisal: the yearly system for evaluating the employees' activities.
4.0. Process of performance management:
01. Planning.
02. Monitoring.
03. Developing.
04. Rating.
05. Rewarding.
4.1. Planning: For attaining the goal of any single business, the company or business needs
to make a plan for that. There is some specific way for every specific goal. Planning means
setting up the process for gain business goal, involve the employee in the process and help
them to understand their job, what they need to do, why they need to do that, and how well
they should do that. Employees‟ task should be flexible so they can do their job easily.
4.2. Monitoring: Any effective company monitored their organizational actively. Monitoring
means observing the continuous project. How the project going on? How the employee
going towards with their specific job. By monitoring any unacceptable process can be
removed, easy to identify the useful contents and can give the proper instruction to the
employees.
4.3. Developing: Development is an important process for an organisation. All organisations
should evaluate and addressed the employee development. In this sense, developing
means improvement of their works by giving them training, giving them proper instructions,
encourage them in their task, help them in their work when they work in their working place.
4.4. Rating: for every single period of time, effective organisation measures the employee‟s
performance whatever they have done within the period. This method can be useful to
equating the performance of all employees over a period of time.
Rating means measuring the workers' performance by given the individual task, rate them by
applying the companies won appraisal and record the all data about all of individual workers.
Rating should be done within every time period.
4.5. Rewarding: Rewarding means greeting workers separately and as a grouping. A basic
principle of effective administration is that all activities are controlled by its consequences.
Superior performance is documented without delay for nominations for recognized awards
to be solicited.
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By using those processes, an effective company can achieve their main target. They can
also find out best worker who can do their job in a perfect way in which way want.
Management can take decision what type of training their employees need, how they can
make them better worker. Overall, by these five processes effective company can manage
the effective performance management.
5.0. Literature review:
Performance management is a more liberal and meaningful idea then performance
measurement. It involves both qualitative and quantitative methods to measure the
performance. Performance management is the way of making of a business achieve faith
from first to last defining business aim and take a decision about useful and capable use of
organisational resources
(john‟s), 03/2005
Performance management is the professional person find out the weaknesses in their line of
attack and fundamental viewpoint. Workers are not happy with the method of performance
management and managers are always in trouble to manage this with their workers. It is
possible for the managers to overcome this matter if they give the workers different types of
benefits and give them the proper design of their tasks. There are some ways of deciding the
performance measurement criteria. Armstrong and baron are mentioned two central
propositions used to measure the performance assessment:
01. People put their best endeavour into the stage well if they know and recognize what
is expected of them and have had the surroundings in specifying those expectations.
02. Worker skill meets expectation is based on:
a) Individual levels of ability.
b) Different types of support from management.
c) Availability of schemes, resources and processes from the organisations.
Performance management systems:
There are several functions of the performance management method:
Strengthening of the organisations worth and norms.
Consolidation of character purpose with those of the organisation.
Give them a chance to apply their own view.
Sharing the belief between management and workers about their expectations.
In a most important review in British, 20 percent says that they have a system, 65 percent
says they had some performance management processes and 15 percent says they had no
system (Bevan and Thompson, 1992).
(Alan Price), 2007
Performance management should start with the individual employee performance by taking
a justification. The performance management process starts from the top level of
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management in any company and its end is end level of workers. Company has an individual
objective for their achievement and align the objective to the workers. Management should
give the idea about their goal and process to the workers. Then worker can meet their main
objective and they can perform in a better way. Without giving any information or by giving
wrong process workers cannot achieve or cannot go so far from their starting point. The
main objective is to motivate the workers, because by motivating them company can push
them in the right way and then they can catch their main target.
(Sowa Jessica, Seiden Sally)
Robert Bacal (1999) defined Performance Management as:
“An in progress statement process, undertaken in partnership, between an worker and his or
her immediate manager that involves establishing clear expectations and accepting about
the jobs to be done”.
“Performance management is the main way by which company ensure a „line of vision‟
among tactical aims and separate movement and behaviours: „It is regarding creating a line-
of-vision between what the individual does and what the organisation needs” (CIPD, 2009).
Performance management should not be a work concentrated method but should occupy an
assured point of conversation among managers and workers at a number of stages of the
procedure. These are surroundings the objectives, half year and year end review and right
the way through the year as workers need route and progress and managers supply in
progress performance response. By exploring the remuneration of appraisals for measuring
performance and the views of line management & employees, it will be possible to consider
the various weaknesses and arguments of abandonment and alternative contemporary
approaches of interpreting performance management. In business all of the worker gets the
chance to prove their performance.
Performance management makes a diagram for individual works towards objectives within a
set plan. A sequence of review right through the year with the line manager ensure that the
individual is monitored, managed, coached and guided in the direction of victorious
achievement of those objectives.
(Adcock, F. & Birth, I. Trivitt, 1988: 403-404).
6.0. Example and critical analysis:
Performance management is a positive joyride for any business organisations. By
considering the performance management company can achieve their goal also it can fulfil
the individual satisfactions. The aim of this objective is to define the company‟s wants; they
can set up their task to do the job. In this task, any business follows some objectives like as
What should be their expectation?
How they can art their way?
How they can give the responsibility to their workers?
Who will do the task?
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Performance management works also as an individual satisfaction. When companies do the
performance management, they consider the all over the performance of an employee.
Along the performance workers get the feedback. Company influence them in different ways,
give them individual response. For inspire the worker different company follow the different
way. Individual business has their individual rules and regulation for doing their performance
management. Here some example of different type of business and their process of
performance management.
6.1. Example:
6.1.1. LIoyds TSB:
LIoyds TSB uses a balanced scorecard to evaluate and supervise worker performance. The
scorecard takes into account the needs of customers, employees and shareholders and
measures individual performance against a range of factors, including financial success,
contribution to the long-standing development of the company, client service, risk
management and personal growth.
LIoyds TSB balanced scorecard goals to show workers how their performance blow their
workmates and clients and how this, in rotate, translates into their in general performance. It
ensures that people understand how their personal objectives relate to their policy, and how
their performance contributes to the Group‟s performance.
All workers get official reviews and advice on performance twice per year.
6.1.2. ASDA:
Performance Management system of ASDA:
As an effective organisation ASDA always want an inspiring, demanding and pleasing
workplace. ASDA certifies that their employ conditions and the workplace situation assisted
in attracting, guidance and retaining skilled and faithful team.
Agency bonus: agency performance considered aligned with the KPIs and functioning
deliverables as being 82.1 percent.
Individual bonus: individual performance management structure, is recognized as growth
factor, was reviewed and enhanced. Growth factor contains a high level of employee
commitment also importance some improvement.
Peer recognition: peer condition smoothed out ASDA‟s commitment to acknowledging and
gratifying excellent performance.
6.1.3. KFC:
Why KFC does the performance management?
01. For achieving their goal.
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02. Management can get a clear idea about their employee, that they do their job, which
is company expectation.
03. Employees are able to obtain the information about their work.
04. Employees get Payment raise and promotion by rating their performance.
05. If employees are not doing well they get that information also.
The process of performance management:
KFC management follows some steps to measure their work performance:
01. Management always observes the employee when they are working on their
individual job.
02. They try to push them more than that what they can do.
03. Management observe that are they on the right track.
04. Management always communicates with the employees.
05. Management also gets the information from a senior worker about the others
workers.
After getting the performance information‟s about the employer's management gives them
pay rise, promotion and also some rewards, that depends on the performance.
I agree with the KFC performance management process because in my view, if they do this
type of performance management, for this reason the workers could be interested to make
their job more smooth way also other workers who don‟t get good feedback they could try to
do the best performance. So company can get more benefit from them.
6.1.4. McDonalds:
6.1.4.1. Individual performance plan:
01. Managers work with the workers to generate an IPP to line up their aim for next
years.
02. Worker is active about their job.
6.1.4.2. Individual development plans: individual development plan McDonalds focused on
the individual task for the present and future position.
They do the mid-year check In the end of July. Worker and management do their review of
business goals based on shifting business priorities.
6.1.4.3. Annual measurement: workers give their own opinion to their managers. Managers
make the direct discussion about:
a. What is done by workers.
b. How they have done that.
6.1.4.4. Performance calibration seminar: managers present the success in the seminar
as
a. Exceptional performance.
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10. [PERFORMANCE MANAGEMENT] October 20, 2011
b. Significant performance.
c. Improvement required/unacceptable.
After doing all of these task managers make a final agreement for the workers: Ready now
for doing individual task, Ready for the future, New to position and current level.
6.1.5. International Retailer:
This company plans a three-phase performance management scheme.
01. Developed the performance criteria, descriptions and forms to be used for people
performance management;‟
02. The system piloted in one geographic area;
03. A complicated system role out nationwide.
The company follows the first phases by which they can do the activity assessment of their
employees and there were four employee level. The performance management planned in
three levels, behaviour, activities and results.
6.1.6. Dell:
At Dell, the key point of success is the swiftness and stability. Dell chief financial officer
Meredith told balance is especially significant in performance management. The CFO looks
after the employee how they could influence the cash conversion cycle (CCC) process. Dell
uses return on invested capital (ROIC) as an evaluation of worth formation, and linked the
ROIC metric to the inconsistent recompense of all executives.
6.1.7. Ford’s:
In Ford‟s which one is second largest business organisation. In this organisation, the
management measures the performance of the workers and give them the rating about their
performance. The management gives the chance that a worker who has a poor rating.
For example, management doesn‟t give any bonus or pay rise for one year and demotion
within two years to those workers whose rating is c and give them a chance for recovering
themselves.
6.1.8. Inter Continental Hotel Group (IHG):
IHG management make their workplace friendly to innovate and motivating foe their all
workers. Their key point is try to understand the employee and give them the proper
instructions. They always meet with their workers problem in a fair way and give them the
fair opportunity to do their task.
6.1.9. Marks and Spencer’s:
In view of M&S management, the performance management is a process, which is
developed by employee and managers. They make the written report about an employee‟s
performance, what is going on? If there is a problem how they can improve that. They do
that every year. They do the re-evaluate to check the efficiency of workers.
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They have performance related bonus and they do that every 3 months. If the store achieves
their target, they give the bonus. They also do the individual bonus like as gift card, 20%
discount format.
6.1.10. Unilever:
Individual and line manager in roundtable chat fixes goals. Company do review of
performance one time per year about the productivity and efficiency. They check that which
jobs are done properly and which one are not done in a given way. From the mistake they
make their next plan about employees career.
By considering all of example we can see that companies need is achieve the target if
worker can do that then they can get the benefit from the company. Simply if you want to get
something at first give something then you can get whatever you want.
6.1.11. Motorola:
Motorola management and workers believe in these key points of the performance
management plan:
01. Workers must do their given task.
02. Task must do by proper way.
03. Workers must know about the reason of task.
04. What is the proper time to do the individual task?
Management gives the workers proper tools, extra money, like as a bonus, apparatus or as
giving them some others opportunity to solve their task of project. Company gives the
workers timely feedback so they can understand at which stage they are standing and how
they cover their all steps.
7.0. Conclusion: Performance management is an effective way for a company to achieve
their goal also a good way to get better performance from the employee‟s. In any business
PM consider some common objectives such as assign the goal, make a plan, train the
workers for the specific goal, give them feedback about their job what they have done. PM is
the only one process to manage the business in the right way. Business target should be in
range, that‟s should be achievable, also it should be in touch of workers. Another thing is
management should give the workers proper payment for their work, they should get more
than that what they expect from the company. If companies can come to this decision then
they can easily achieve their target.
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12. [PERFORMANCE MANAGEMENT] October 20, 2011
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approach)sixth edition
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By Sally Seiden, PhD, and Jessica E. Sowa, PhD
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13. [PERFORMANCE MANAGEMENT] October 20, 2011
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