Performance Management Activities

transaction Management ActivitiesPERFORMANCE MANAGEMENT SYSTEM effect guidance includes activities to ensure that goals argon consistently being met in an effective and efficient manner. Performance concern can focus on proceeding of the organization, a department, surgical processes to build a product or service, employees, etc. Information in this publication leave give you some sense of the e realplaceall activities involved in cognitive process management. thence you energy enhance your understanding by reappraisaling closely think library topics referenced from the sidebar.IMPORTANCE OF PERFORMANCE MANGEMENT SYSTEMSetting up a good deed management governing body doesnt happen overnight or by accident. You ask to consider its design and cargonfully programme how it will work before coach-and-fours begin using it to evaluate employees.BenefitsManaging employee or strategy action facilitates the effective deli truly of strategic and operational goals. There is a clear and immediate correlation between using murder management programs or software package and improved worry and organizational results.A performance management system should provide employees with these four basic benefitsA clear understanding of job expectations fix feedback nearly performanceAdvice and steps for improving performanceRewards for good performance4 Key Benefits of Performance Management system1. PM foc offices on results, instead than behaviors and activitiesA common misconception among supervisors is that behaviors and activities are the same as results. Thus, an employee may appear passing busy, but non be contributing at all toward the goals of the organization. An congresswoman is the employee who manually reexamines completion of every form and procedure, rather than supporting automation of the review. The supervisor may conclude the employee is very committed to the organization and works very hard, thus, deserving a very high performance ratin g.2. Aligns organizational activities and processes to the goals of the organizationPM identifies organizational goals, results needed to achieve those goals, footfalls of effectiveness or efficiency ( step forwardcomes) toward the goals, and operator (drivers) to achieve the goals. This chain of measurements is examined to ensure alignment with overall results of the organization.3. Cultivates a system-wide, long view of the organization.Richard A. Swanson, inPerformance Improvement Theory and Practice(Advances in Developing Human Resources, 1, 1999), explains an effective performance service process must follow a systems-establish approach while looking at outcomes and drivers. Otherwise, the effort produces a flawed picture. For example, laying off slew will likely produce short-term profits. However, the organization may chargetually experience reduced productivity, resulting in long-term profit loss.4. Produces meaningful measurementsThese measurements devote a wide vari ety of useful applications. They are useful in benchmarking, or setting standards for comparison with best praxiss in different organizations. They provide consistent rump for comparison during internal change efforts. They indicate results during improvement efforts, such as employee training, management development, quality programs, etc. They help ensure equitable and fair handling to employees based on performancePERFORMANCE MANAGEMENT SYSTEMA Performance Management System enables a business to sustain profitability and performance by linking the employees pay to competency and contribution. It provides opportunities for concerted somebodyal development and career growth. It brings all the employees under a single strategic umbrella. Most importantly, it gives supervisors and subordinates an equal fortune to express themselves under structured conditions. Managing this process efficaciously isnt easy. It calls for a high level of co-ordination, channeled education flow, an d timely review. Whether employees are at a single place, or spread across multiple locations, the use of technology can help simplify the complete process for more effective knowledge management.Customize Performance Management to Fit Global CulturesExperts say companies a good deal impose an American style of performance management on employees based in other countries, even when such a system conflicts with local cultural norms. A better approach, they say, is to adapt the system to fit the culture. U.S. firms pick up their existing performance management program philosophy, intent, forms, everything and try to force-fit them into non-U.S. cultures, forgetting that the nature of the employer/employee relationship varies widely from place to place, But this is a mistake. What works in Dallas might not work so turn aroundty in Dalian or Dubrovnik. In some cultures you simply cannot transpose culturally offensive management styles.The 360-degree approach is a good example of this. It requires a fundamentally egalitarian mindset and time value system in order to be effective.Its a rather Western concept to evaluate performance management scientifically and with a process that is valid and reliable and rational company. The management and estimate of performance has always been d one(a) or so the world, but its been done more intuitively and organically, and not in a rational, organized process. In the West that commonwealth will say things clearly, that are problems, and thats not the case in many another(prenominal) other cultures around the world.However, because the American business model is accepted and admired, many companies outside the joined States will simply accept the American way of doing business rather than expecting to dupe practices adapted to fit their culture, saidA good performance estimation process is an integral part of the performance management system and it works seamlessly with the other sections. This article takes a holistic approach to performance management and gives an overview of the components. A performance management system has the following components and interfaces goal-setting, regular reviews, annual appraisal, development process and linkages to other systems.Goal-settingThis process is the foundation for a good performance management system. It brings in the clarity required to deliver the required results. The organizations expectations are set in the form of key result areas (KRAs), along with strong indicators of the required standards ( similarly termed measures of performance). The benefits of giving clear directions are many. It helps increase productivity by enabling people to focus on the requirement it minimizes frustration and enables employee satisfaction.Regular reviewsReviews are a critical component of the system. Reviews give timely feedback to the unmarried. It is important to schedule formal reviews during the guide of the year. These can be half-yearly or quart erly depending on the need. Structured mid-term reviews enable the organisation to take stock of the performance during the given compass point. It gives the individual an fortune to discuss his/her achievements during the given period and to look at areas of improvement. In a dynamic environment, it is important to keep abreast of market placements. Reviews can be utilise to make midcourse correction in the KRAs.It is possible that the macro environment has changed and that some of the objectives squander to be reviewed. For example, certain sectors in the economy may be doing extremely well and the organisation may see a need to review sales numbers based on these indicators. Reviews need to be structured on a regular tush to ensure that there are no surprises in the annual appraisal. Regular and structured reviews are a critical component of the performance management system and this is essential to ensure that the performance management system is not the same as the annual performance appraisal. As a part of this sub-system, we thrust processes such as coaching, mentoring, performance improvement plans, etc.Annual appraisalA typical appraisal system could be knowing on one of the followingConfidential report The report is written by the supervisor and is, typically, not shown to the individual. Decisions, such as promotions and changes in compensation are made, based on this report.Report by supervisor that is shown/given to the individual and discussed.Self-appraisal by the individual, value-added comments by the supervisor and a discussion In this system, the individual writes a self-appraisal vis--vis KRAs set at the start of the year. The manager adds his or her comments. Organisations follow one of the following methods of ratings-(a) rating given by the manager or (b) the individual and the manager give ratings and the organisation has a mechanism to deal with differences between the two. There is an opportunity for the individual and the man ager to discuss the contents of the appraisal.People working in the software industry or in a project environment may raise a question about the relevance of the annual appraisal. Then there are also professionals who work with different project teams during the course of the year. In this case we could have reviews signed-off at the end of separately project. These could be collated at the end of the year to look at overall performance and linkages to other systems.Development planThis pertains to the training and development sub-system. A part of the development plan stems out of the annual appraisal. This is the result of the areas of improvement that emerge from the appraisal and competencies required for new roles, if relevant. A good training and development process will also take the necessary inputs from the organisations business plan. This is required if the organisation is investing into new business or entering new markets.Linkage to rewards systemLinkages to processes such as compensation, rewards, progression and successionplanning-the performance appraisal system, in many organisations, has a link to the rewards system. Individuals judge the performance management system and the culture of the organisation based on the message sent by the rewards system. If the rewards system recognises individual contribution and ignores contributions made to team objectives, the people in the organisation start focusing on individual tasks.Therefore, linkage to many of these systems need to be contemplated upon, articulated to the people and implemented with consistency.MEANING OF PERFORMANCE APPARISALPerformance appraisal system has been defined in many ways. The simplest way to Understand the meaning of performance appraisal is as followsA regular and continuous evaluation of the quality, quantity and style of the Performance along with the assessment of the factors influencing the Performance and behavior of an individual is called as performance Appraisal .Performance appraisal also means an appraisal of the growth potential of an Employee, with a view to providing information to the organization leading to positive Action and enabling feed-back to the individual aimed at his performance Improvement, personal growth and job-satisfaction. In short, we can say that Performance appraisal is expected to result in an assessment ofGrowth potential of the employeesCorresponding training needs for the employeesCapabilities for their placement in higher posts,Conduct and discipline of the employees andThe need of the organization to evolve a control mechanismOBJECTIVES OF PERFORMANCE APPRAISALThe main objective of the system of performance appraisal is to reward those who are working(a) efficiently and honestly in the organization. At the same time, it also aims at eliminating those who are inefficient and unfit to carry out their responsibilities. It has to be done almost continuously, so that no injustice is done to a deserving individual. It is, therefore, necessary to clearly define the organizational objectives, targets and priorities. It is further necessary to define clearly the rote learning and responsibilities of the persons involved in the functioning of the organisation.Performance appraisal also aims at helping the management in carrying out their tasks more effectively. A sound system of performance appraisal results in framingA sound selection ?policy.An effective promotion and placement policyAn improved system of career and hands planningA realistic training programmeA good reward and punishment system andAn effective system of control and discipline in the organization.These elements are essential for any modern management system. No country can neglect them for long.We can thus say that the main objectives of performance appraisal are as followsTo carry out a fair and impartial assessment of the quality, quantity and stvle 01 the work performance of the individuals working in the organisation.To as sess the terminus of the various factors which influence the performance of the individuals.To reward the capable and efficient employees.To provide opportunity for improvement of their potentialities to those who are less capable and efficient.To make optimum physical exercise of the available human resources for the fulfilment of the organisational goals.To help management in evolving and framing sound policies and programmes relating to selection, placement, promotion, training, discipline, control and manGlobal Trends in Performance Appraisal computer programmeThe performance appraisal process has become the heart of the human resource management systemin the organizations. Performance appraisal defines and measures the performance of the employees and the organization as a whole. It is a tool for accessing the performance of the organization.The important issues and points concerning performance appraisal in the present world areThe focus of theperformance appraisalsis turni ng towards career development relying on the dialogues and discussions with the superiors.Performance measuring, rating and review systems have become more detailed, structured and person specific than before.Performance related to pay is being incorporated in the strategies employ by the organizations.Trend towards a360-degree feedbacksystemThe problems in the implementation of the performance appraisal processes are being anticipated and efforts are being made to overcome them.In India, the performance appraisal processes are faced with a lot of obstacles, the most prominent being the lack of quantifiable indicators of the performance.GLOBAL TRENDSThe emergence of following concepts and the following trends related toappraisal can be seen in the global scenario360 Degree Appraisal360 degree feedback, also known as multi-rater feedback, is the most comprehensive appraisal where the feedback about the employees performance comes from all the sources that come in contact with the e mployee on his job. Organisations are increasingly using feedback from various sources such as peer input, customer feedback, and input from superiors. some(prenominal)(predicate) forms with different formats are being used to obtain the information regarding the employee performance.Team Performance AppraisalAccording to a wall street journal headline, Teams have become commonplace in U.S. Companies. Most of theperformance appraisal techniquesare formulated with individuals in mind i.e. to measure and rate the performance of the individual employee. Therefore, with the number of teams increasing in the organizations, it becomes difficult to measure and appraise the performance of the team. The question is how to separate the performance of the team from theperformance of the employees. A solution to this problem that is being watch overed by the companies is to measure both the individual and the team performance. Sometimes, team based objectives are also included in the individ ual performance plans.Rank and Yank Strategy similarly known as theUp or out policy, the rank and yank strategy refers to the performance appraisal model in which best-to-worst ranking methods are used to identify and separate the poor performers from the good performers. Then the action plans and the improvement opportunities of the poor performers are discussed and they are given to improve their performance in a given time period, after which the appropriate HR decisions are taken. Some of the organisations following this strategy are Ford, Microsoft and Sun Microsystems.Global VariationsIn the linked States it is common for each employees performance over the previous six months or year to be documented and followed by a one-on-one meeting between the employee and their supervisor, at which time the employee will receive their rating and discuss expectations for the bordering rating cycle. In some cases employees are expected to complete a self-appraisal, which might be factor ed into their review, while in other cases feedback from peers and customers might be included as part of a 360-degree assessment of an individuals performance. Though far from perfect, and often dreaded, the American performance appraisal process suits the American culture, which is regarded as highly individualistic and egalitarian. For example, in the Unites States the performance rating is often used to determine pay. The basic intuitive feeling in the acceptability, the rightness, the virtue of pay for performance.Those who contribute the most should get the greatest rewards.In the U.S. employees tend to rate themselves and others very highly, such as a 4 or a 5 on a 5-point scale-using an everyone gets a prize. In many European cultures the highest rating might be a 3, and in Asian cultures they wouldnt rate themselves.A pay-for-performance system is inappropriate in cultures that focus on interpersonal relations and collectivism.In Japan compensation is not based on performa nce. In fact, its hard to identify the individual performance, because the focus is the team. If an individual were identified as performing so well that they got compensation in choke for it, it would be anathema to the groups collaborative ethos.In some countries, such as Korea and Germany, use performance management processes that closely parallel those used in the United States. The same is true for France, though he noted that there is less of a connection between performance and pay in that nation. However, the Japanese and American processes have diverged significantly over the years. The Japanese system is frequently, and even intentionally and openly, used as a means of discriminating against undesirable employees, a practice that is prohibited under U.S. civil rights laws. And although the performance appraisal process involves filling out the appraisal form and discussing it with the employee, In Japan the appraisal process often involves only the completion of the form without the discussion between boss and subordinate of the results of assessment. Those who work in the U.S. often put a great deal of value on the information that comes from 360- degree feedback, according to. But in a country like India-which tends to be more collective than individualistic and which embraces a dynamic distance, or inequality of power, there is less value placed on the opinions of others and it would be seen as inappropriate culturally to ask employees to fill out a questionnaire on their boss. Similarly it would be difficult to implement a system that includes self-appraisal in cultures that are defined as collaborative, consultative and consensus oriented. People simply dont handle in the capital I and are very uncomfortable doing so. In a culture like China or Japan, asking a person to speak about themselves in a way that is honest and direct and that will be appraised by their superiors is a waste of time.And in some cultures, a face-to-face performance mee ting never takes place.In severely hierarchical cultures where the boss is expected to just recite you what they think, there may not be a direct conversation. They may communicate through a mediator to help save face.Filipino managers engage in a practice called strike interpersonal relations. If a boss has a problem with one of his subordinates, he wont talk directly to the subordinate about it, hell instead tell his wife because he knows his wifes cousins hairdresser is related to the problem employee. In other cultures, managers and employees go out for a drink periodically and chat informally about problems at work. The end result is that the manager knows and has a good sense of the performance of the individual, but if you ask them to assess the employee on a scale of one to 10 they cant do so. There is a dependent relationship in Asian cultures. Employees depend on leaders to help them solve work-related problems. Thats at odds with Western cultures where staff members sol ve things on their own.In some cultures the relationship between the manager and subordinate is so close and ongoing that its test of like a parent/child relationship. Managers know how employees are performing and give them feedback on a regular basis.A Look at IndiaThe business culture in India varies depending on whether it is a family-held business, an Indian company or a Western or American multinational organization, and that affects the nature of the performance management process, according to Nirmala Menon of Interweave Consulting Pvt. Ltd., a diversity consulting firm in Bangalore, India. As most Indians are socialized to be hierarchy oriented, this often tends to spill over into the workplace, Menon told SHRM Online. In family-owned or the more traditionally-run organizations, the boss or manager often takes the position of the father in the family. Organizations rely heavily on informal feedback from the higher-ranking person, which might be given indirectly and which is absorbed by the one for whom it is meant and others, Menon added.Menon says this means that the employees career growth is the bosss responsibility. The expectation then is that Father knows best and what is conveyed is accepted even if they are in disagreement, she said. Evaluations are therefore often influenced in such situations by the deference shown to the boss and the level of loyalty exhibited compliance more important than performance.But Menon said that modern Indian organizations and multinational corporations, particularly IT and telecommunications firms, generally adapt to the global value systems of their companies. As a result, evaluations tend to be more structured and include face-to-face meetings, she said, followed by a written document signed by employee and manager and which typically incorporates input from peers and customers to substantiate the rating. charm indirect feedback also exists in these organizations, given the heightened awareness of a fair and professional environment, there is more acceptance and expectation of a documented communication, safekeeping in mind the objectives for the period under review, Menon added.Annual Performance Appraisal and Evaluation in IndonesiaEarly in the 20th century, the biggest job as a managers is to teach a newly hired employee to fail intelligently to experiment over and over again and to keep on trying and failing until learns what will work. As we begin 2004, many companies are struggling with the issue of employee appraisal and evaluation. While generally adopted in most western-based business cultures, such employee review and appraisal in Indonesia can be fraught with misunderstandings as to shoot for and methodology, be filled with accusations of impartiality, and be slowed by hesitation to formally criticize a subordinate.This issue comes up in easily 95 percent of my cross-cultural training programs. American companies normally wish to establish some sort of review procedure but once they begin addressing how to actually institute the process and decide what direct benefits they wish to see, they often become bogged down. The threshold question then is whether a foreign company should even try to implement such a system. There are several cultural barriers to such a system here. Among them is the difficulty with direct communication with employees and also the saving up of problem areas until a later time.Direct communication is difficult for most Indonesians. Indonesians generally adopt an indirect approach to problem solving to avoid the possibility of confrontation and the disruption of office harmony. The preservation of such office harmony being a prime Indonesian business value, of course, and one often having priority over work performance. Also in Indonesia an erring employee or other problem situation is addressed as soon as possible, albeit in an indirect and non-blame pointing way, and then forgotten. To bring the subject up again at some review several months later is going to be considered inappropriate.For these two reasons, individual performance appraisals tend to have the following pattern An employee comes in to the meeting with some misunderstandings or perhaps anxiety about what will be discussed and how it will affect their career. The supervisor can go over the good qualities of the employee without difficulty. However, when the supervisor begins discussing areas that may need improvement there is normally an attitude change on the part of the employee with him or her becoming both defensive or submissive. In other words, the employee may either disagree with the supervisors assessment or else may ask something like Why are you doing this to me? I thought that we had a good working relationship. I did not realize that I was letting you down so badly. Do you want me to resign?The supervisor then is in the position once again of explaining the purpose and objective of the assessment process. In general, annual pe rformance evaluations and reviews tend to be disruptive to the Indonesian office. In my opinion, companies should focus on immediate feedback and reprimand, if needed, and not use the annual approach.Another difficulty is the cultural reluctance for some Indonesian managers to formally and in writing criticize their own subordinates. I often hear the example of the expatriate manager who has had one of his direct reports complain often about the performance of his own subordinates. However, when it comes time for the annual review, the direct report submits an bang-up report on that same subordinate.The decision to have annual performance evaluations and reviews may not be up to the Indonesian subsidiary of a multi-national company. legal residence office may dictate such a policy and the local companys only choice is how to implement. There seem to be three basic approaches to this situation. graduation exercise is to just go through the motions, telling your employees that this is a Western thing. It will not affect your profits or career, which basically voids the process. Second, you can use the information to provide training and education of the employees turning the evaluation process into a kind of reward system. Third and most difficult, is the attempt to fully implement and effectively use this Western evaluation tool. It can and has been successfully implemented by a number of American companies operating in Indonesia, but it does need the say will of the top management along with allocated resources and training to be successful.At the very least, there must be a significant training period to help your employees understand what the process is and, more importantly, how it will affect them. course of study one should involve a formal introduction to the process with written, quantifiable criteria for the evaluation. Year two should include mock appraisals that do not have any effect on the career of the employee. Year three could see the firs t put down appraisals. Once the process is institutionalized, new employees will be told by their colleagues about this strange and foreign system and what to expect. It then becomes part of your third corporate culture. any attempts to speed up the process are often seen as arbitrary and unfair.Further, you should definitely expect such accusations of being arbitrary and unfair if you take the next step after the evaluation process and tie the appraisal into bonuses or salary increases. Such performance-based bonuses or salary increases are pretty much in direct opposition to the Indonesian business values of the group working together and maintaining office harmony. Traditionally, the ideal Indonesian employee is one who is loyal to the boss for a long time. In other words, loyalty and seniority are the prime attributes, and by loyalty, I mean personal allegiance to the boss, not to the corporate entity. Pointing out a specific employee and emphasizing the fact that he is superi or to and a better employee than those he or she works with on a daily basis is going to be disruptive to the office and embarrassing to the individual.For instance, if you have an annual office party or demonstrates dinner for your staff and you say something like promptly here is Budi who outperformed everyone else in our office and we are giving him a new TV. The polite clapping of his co-workers is going to be overshadowed by thoughts of traitor and plots for revenge against the award winner. If you bring up another employee and say Now here is Bambang who has worked for our company for 10 years and we are giving him a new TV, Bambang will love in the limelight and his co-workers will no doubt truly admire his accomplishment. The difference being that Bambang was rewarded for seniority, while Budi was rewarded for violating basic Indonesian business values.One should not expect the same confidentiality of salary information in Indonesia that one might expect in the home countr y. We joke that on the day performance bonuses are given, the employees exchange pay stubs in the canteen. Even if the situation is not that extreme, you can be sure that most people in your office know what each other has received, and those employees with more seniority may soon be in your office asking for a bigger bonus or larger salary increase.You may then once again be explaining the companys policy on performance appraisals and evaluation but this time be met with defensive and even incompatible disagreement as to whom was the better worker. Allegations that the companys criteria for awarding bonuses or salary increases is unfair and arbitrary and lacks understanding of the situation in Indonesia may be made. Employees have surely used the conflict resolution strategy of appeal to authority to resolve these disagreements going to the country manager complaining that their supervisor is acting improperly. There have also been cases of employees going to Indonesian governmen t departments like Manpower or Immigration complaining about their expatriate supervisor. With the current priorities in these departments, such complains have resulted in the early repatriation of expatriate supervisors.The process of annual performance appraisal and evaluation of Indonesian employees is not one that foreign companies should enter into lightly. The implementation of this very Western-based management tool should be well thought out and supported by top management. Alternatives exist that may be better suited to your companys long-term success in Indonesia. Encouraging employee performance and addressing areas of weakness remain a good m