SAP Solution BriefmySAP ERP

EMPLOYEE PERFORMANCEMANAGEMENT Successfully Drive and Execute Enterprise Strategy

Companies worldwide

recognize the value of retaining

and developing high-perform-

ing people for their ability to

innovate and grow in the future.

That’s why comprehensive

talent management processes

are the hot topic of strategic

human capital management

today. The mySAP™ ERP

solution helps organizations to

progress towards a complete

talent management solution,

with the end-to-end perform-

ance feedback cycle that inte-

grates company planning with

employee objectives,

appraisals and performance

feedback, and compensation

administration as an integral

part of it.

Acquisitions, mergers, partnerships, and corporate realignmentsare the rule in the marketplace today. At the same time, innova-tion and creativity are essential for success – and that requiresskilled and dedicated employees. But the dynamic nature of to-day’s business world is taking its toll on these employees. Now,it’s more important than ever to involve employees in company-wide changes, inspire them to execute strategies and goals, andmake their contributions to the enterprise identifiable andmeasurable. State-of-the-art, goal-oriented management toolsand measures that target an individual’s area of responsibility arerequired for your enterprise to succeed in today’s economy. Inconjunction with appropriate financial incentives, performancefeedback motivates employees to achieve and excel.

Flexible Support Throughout the Performance

Feedback Cycle

The performance management capabilities of the mySAP™ ERPsolution delivered in the mySAP ERP Human Capital Manage-ment (mySAP ERP HCM) solution bring performance feedbackprocesses to life. The solution supports end-to-end processesthat provide transparency and help to communicate the enterprise strategy, align initiatives and goals throughout the enterprise, analyze performance, and reward the workforce accordingly. The solution is extremely adaptable, allowing youto custom design both the content of your performancefeedback documents and processes. These essential features giveyou and your employees a road map to success, and just asimportantly, set the enterprise on a successful course into thefuture.

Figure 1: The Performance Management Process

Performance Planning

Integration with the balanced scorecard capabilities of mySAPERP greatly facilitates the performance planning process by pro-viding employees with insight into the organization’s strategy.And you can easily transfer organizational or departmental goalsrelevant to employees directly from the scorecard into an indi-vidual’s performance planning agreement.

Individual objectives agreed upon between employees and man-agers, along with appropriate dates and time lines for meetingthe objectives, are easily entered into the software. You can usefree-form objectives and notes, predefined objectives, competen-cies, or key behaviors, and allow managers to modify them as required.

The solution provides strong linkage with other talent manage-ment functions, allowing you to derive objectives from an employee’s position or job requirements, and include trainingcourses and developmental activities in the performance plan-ning agreement. Now, you have a direct link between personnelobjectives and development needs.

Ongoing Feedback and Coaching

Employee reviews enable you to monitor objectives continuouslyduring the year. You can set dates for reviews in the system anduse the workflow capabilities of the SAP NetWeaver™ platform tosupport this process with timely reminders for all participants.Review meetings help you to keep track of the relevance of ob-jectives; if necessary, obsolete objectives can be removed from theperformance planning agreement. Continuous monitoring al-lows you to ensure that employee goals are continuously in syncwith enterprise strategy. Detailed logging functionality enablesyou to record the history of objectives during a performancefeedback cycle. Attachments allow you to add additional infor-mation on the employee’s achievements.

Reviews

Additional appraisers such as dual reporting managers, peers,project leaders, or the employees themselves can be integratedinto the appraisal process. Before the final appraisal is completedby the direct manager, these additional appraisers can each add their evaluations independently, including employee self-appraisals, thus providing a full picture of the employee.

Encouraging Real Personnel Development

The performance management capabilities of mySAP ERP HCMallow measurable comparisons, support performance-basedcompensation, and promote personnel development that is inline with corporate objectives. Both the goals and personal con-tributions to attaining them are highly visible, which inspirestrust in both managers and their employees. This in turnimproves the performance and morale of your team. Detailedevaluations, status overviews, and ranking lists make the infor-mation easy to view and understand.

Enterprise Compensation Management

• Promotions

• Salary adjustments

• Bonus payment

• LTIs

Succession Management

• Top performer

• High potentials

Learning & Development

Individual development plans

Individual development plans

Individual development plans

Identification ofoverall trainingneeds and creation of training plans

Coaching&

Enabling

Plan Review

Enterprise Vision and Strategy

Flexible Performance Feedback Processes for Your

Needs

The adaptability of the software makes it easy for you to tailorthe performance feedback system to meet the needs of your en-terprise. The performance management capabilities of mySAPERP HCM can streamline your processes to support your busi-ness – from a simple appraisal to a comprehensive performanceplanning and performance feedback process that includes multi-rater feedback, timely notifications, and workflow. Permission-based access to information ensures that employees can accessonly their own data, and managers can access appraisals of alltheir subordinates.

Because employee performance management capabilities aretightly integrated into mySAP ERP HCM, personnel develop-ment departments can align performance feedback processeswith corporate strategy and business goals. The following are a few examples of how you can integrate these capabilities intoyour existing mySAP ERP HCM solution and SAP® Strategic Enterprise Management (SAP SEM) application:

• Integration with the competency management framework of mySAP ERP HCM improves data quality and efficiency byautomatically transferring obtained qualifications to anemployee’s qualifications profile after completing an appraisal.

• Integration with SAP SEM improves the communication ofthe organization’s strategy and initiatives, and performanceratings can be directly tied to strategy execution.

• By integrating with SAP Learning Solution and the personneldevelopment capabilities of mySAP ERP HCM, you can moni-tor employees’ individual training and development progressthroughout the year.

• Integration with the organizational management capabilitiesof mySAP ERP HCM allows you to route performancefeedback documents through the organizational hierarchy,thus eliminating manual paper approval processes.

• Integration with the enterprise compensation managementcapabilities of mySAP ERP HCM allows managers andcompensation administrators to generate compensation

adjustment proposals. They can easily tie performance ratingsand performance-based pay, reducing manual data mainte-nance efforts.

• The SAP Business Intelligence component of SAP NetWeaverenables you to provide comparative overviews of appraisal re-sults as reports and graphics and facilitate calibration processesto ensure fairness in employee appraisals and compensationpackages. The enhanced analytics capabilities provide decisionsupport for succession management and individual promo-tions. You can monitor the performance feedback process andanalyze performance levels throughout the organization.

What’s in It for You?

SAP is committed to providing you with a comprehensiveemployee performance management solution as part of theoverall talent management capabilities of mySAP ERP HCM.With this employee performance management functionality,your organization will realize the following benefits:

• Improved communication of enterprise strategy

• Stronger strategy focus at the management level

• Enhanced workforce alignment with enterprise strategy

• Simplified performance reviews and identification of top performers

• Comprehensive comparison options as a basis for fair performance-based compensation

Find Out More

To find out how employee performance management can makethe difference at your enterprise, please visitwww.sap.com/hcm.

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mySAP ERP is powered by the SAP NetWeaver platform, the open integration and application platform that enables change.SAP NetWeaver helps companies align IT with their business. It allows companies to obtain more business value from existingIT investments and to deploy a services-oriented architecture.SAP NetWeaver reduces total cost of ownership and complexityacross the entire IT landscape.

SAP NetWeaver powers mySAP Business Suite, SAP xApps™ pack-aged composite applications, and partner solutions. It providesthe best way to integrate all systems running SAP or non-SAPsoftware. SAP NetWeaver unifies integration technologies into asingle platform and is preintegrated with business applications,reducing the need for custom integration.

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