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Mission
Organization Strategy/Policy
Objectives for Components of Organization
(Quantitative, Qualitative)
Job Purpose: Achieve Specific Outputs
(Determined by Management)
Accountability: Determine/Measure Outputs
Job Objectives
Tasks
TOP-DOWN APPROACH
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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”
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Top-Down Approach - An Example:
Corporate
objectives
Divisional
objectives
Finance Div.
Marketing Div.Production
Div.
HR Div.
1 2 3 4 5 6
7 8 9 10 11 12 ..
= Individual objectives of the Head of Div. 1 2 3 4 5 6 7...
Individual
objectives
Executive 11 2 3 4
5...
Executive 21 2 3 4
5...
Executive 31 2 3 4
5...
Executive 41 2 3 4
5...
Cascading
Objectives
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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)
PM is NOT,
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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
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Purposes of PM
Ensuring individual performance is contributing to corporate objectives
Building procedures for employee development
Sustaining and improving employee motivation - by ‘Rewarding’
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To provide a sound basis for organization’s T&D plans for the future and for ‘Succession Planning’
Correcting misunderstandings concerning performance expectations
Purposes of PM . . . .
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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
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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
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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’
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Features . . . .
Making things happen and achieve, rather than waiting for things to happen
Encouraging self-development
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Performance Planning
Reviewing
Rewarding Managing Performan
ce
PM CycleStrategic
Objectives
Training, Career Development etc.
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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
Performance Planning
right things: Effectiveness
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”An objective is a clear statement indicating how a particular output will be achieved in both quantitative and qualitative terms”
Objective Setting
Specific
SMART Objectives:
Measurable Achievable Realistic Time- bound
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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
Performance Planning . . . .
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Performance Planning . . . .
Though Achievable, must be Stretching
Must be set in all important areas of the job
Must not be too numerous
Priorities should be made clear among objectives
If outputs are not easily measurable, relate objectives more to Competencies
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Individual Development must be ensured
Necessary support must be provided by the Superior once objectives are set
Performance Planning . . . .
Qualitative and Developmental aspects must not be neglected. Hence any PM scheme must have a mix of,
a. Quantifiable Outputsb. Behaviorally-based Competencies
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Performance Planning . . . .
Opt for
Behaviorally-based Competencies
Certain jobs may have outputs which are,
Not directly related to Org. outputs Difficult to be defined and / or measured
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But . . . .
Performance Planning . . . .
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
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Subjective Vs Objective Criteria
Depends on the person
Independent of the person
Subjective Objective
Qualitative Quantitative
Comparative AbsoluteApproximate Exact
Cannot be defended
Can be defended
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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’
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Managing Performance . . . .
Practically,
Providing appropriate resources etc.Advice and clarification to make required results clearTraining & Development (T&D)Adjusting targets, priorities and performance measures as per Org. priorities, markets, government policies etc.
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Managing Performance . . . .
Must take responsibility for one’s own performance - Managers in particular to show by example
Management Style will depend on,
Personality of individualNature of taskTime-scaleOrganization culture
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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
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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
Reviewing Performance
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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
Reviewing Performance . . . .
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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
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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
Formal Appraisal-A few tips . . . .
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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
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Informal Interviews can be . . . .
Informal chats
Monthly meetings
Lunch-hour discussions
Progress reviews
Addressing emerged issues
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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
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Rater (Appraiser) Options
Superiors
Peers
Subordinates (Reverse Appraisal)
Customers
Self
Must be knowledgeable of the Person
and the Job….!
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A PM process which includes appraisals by,
SuperiorsPeersSubordinatesCustomers andSelf
360-Degree Feedback Appraisal
Gives a total picture of performance
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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
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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’
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What are ‘Rater Errors’....?
Unclear standards
‘HALO’/‘HORNS’ effects
Central Tendency
Leniency/Strictness
Bias
Recency error
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Three ways to avoid . . . . !
Understand issues from the side of
employees
Choose the right appraisal tool
Train Raters/Appraisers
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Training and Rewards
Arrange appropriate training
Implement procedures for controlling
Rewarding and Recognition
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Rewarding Performance
Reward: Return for achieving targets/objectives - Not only financial but can be praise, greater opportunities for T&D and promotion also
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Objectives of PRP
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
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Objectives of PRP . . . .
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
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Old and Modern PM systems - A Comparison
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
An individual’s performance is measured within a framework of fixed systems and processes
Objectives can be subsequently modified/new objectives can be introduced depending on the dynamics of the environmentAn individual’s performance is measured based not merely on the results but also on his/her contribution for improvement
Old Modern
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Tomorrow . . . .
A culture nurturing organizational growth and individual development . . . .
Upul HerathManpower Planning Section
Thank you . . . .