Description
This is a presentation explains about the performance management evaluation for employee as well as organizations.
Managing Organisational and Employee Performance
The Basics …..Some Questions
• What is performance management?
• How do we define „performance?? – Defining performance in the context of an organisation?s needs • Distinguishing between between individual and
team performance? Business and organisation
performance? • What is the concept of „performance metrics??
The Basics …..Some Questions
• Why does performance need to be
managed?
• Why is organisation goal setting required?
• How can organisation performance
planning and management be done in the
absence of a formal goal setting process?
The Concept
• For an individual or an individual organisation „performance? can take on a relative meaning – i.e. It can mean different to different organisations or different individuals
• The meaning would depend upon several circumstances e.g. stage of organisation growth and life cycle, organisation culture and learning orientation, external environment and what the organisation must do to remain in business
The Concept
• „performance? also has an absolute context there are globally acknowledged performance standards e.g. ISO certification for quality, PCMM levels, six-sigma.
Performance Constituents
• Organisation – macro standards, absolute achievements – COLLECTIVITY
• Business – bottom line (financial), top line (market), operational performance (cycle times, per unit indices) – TEAM, INDIVIDUAL COLLECTIVITY • Individual – key peformance areas, individual performance targets
Aligining Performance
Organisational Performance
ORGANISATION
TEAM
Business/Operational Performance
Individual
Individual Performance
Performance Management
“A
process
for
establishing
a
shared
understanding about what is to be achieved,
and how it is to be achieved, and an approach
to managing people that increases the
probability of achieving success.”
Hay Management Consultants
Performance Management
“A process for establishing a shared understanding,
an approach to managing and developing people in a way which increases the probability that it will be achieved in the short and longer term”
Armstrong
Performance Management
“Performance Management is a way of translating
corporate goals into achievable objectives that cascade down throughout the organisation to produce optimum results.”
IRS Management Review
Performance Management
“Performance Management is a means of getting better
results from the organisation, teams and individuals within an agreed framework of planning goals, objectives and standards.”
Armstrong and Murlis
PM is all about managing individual performances to achieve
organisational performance
Key Themes in Performance Management
• Process • Concerned with the organisation and the individual both • Concerned also with alignment of individual and the organisation • Focus on results – organisation outcomes • „shared understanding? of the meaning of performance • Emphasis on planning for performance • By implication, communication is an important part of the process.
Performance Appraisal and Performance Management
Appraisal • Retrospective • Greater focus on individual • Judgemental • Minimum role for appraisee
Management
• Forward looking • Broader in scope • Involvement and participation - trust • Diagnosis and analysis important part of process
Performance Appraisal and Performance Management (Contd…)
Appraisal • Annual exercise • Can be top-down system • Often linked to pay • Owned by the HR department
Management
• Focus on Organisation outcomes • Continuous process, more dynamic • Owned by organisation and line management • May or may not be linked to pay
The Shift From Appraisal to Management Has Come Due to….
• Business Concerns – competition, external environment
• Advances in management theory • Technological developments – imply performance expectations • organisation restructuring – changing organisational processes • Inadequacies of performance appraisal
And its objectives are …..
• Clarify What is to be achieved – planning for performance • Create capability for performance achievement • Reward and recognise performance • Institutionalise a process of continuous review and feedback • Involve staff members in the performance achievement process
Perspectives of Performance Management
• System for managing organisational performance
– setting corporate objectives, detailed set of plans, budgets, etc., systematic review of performance of all functions and services
• System for managing employee performance – „shared activity between the manager and the managed? • System for integrating the management of organisational and employee performance – defns.
Activities in Performance Management
• Planning for performance – goal setting
• Facilitating performance – empowering
• Creating capability for performance – training and development
• Review of performance – appraisal and feedback • Acknowledging performance – reward and recognition
Moving Beyond Systems, Tools and Techniques
• P = A + M + O (Ability, motivation &
opportunity)
• Performance culture – empowerment, resourcefulness, • Engaging the individual – aligning self and professional goals
Organisation Performance Planning
Setting Organisation Objectives
Defining Performance
• Financial performance – PAT, PBT, shareholder returns, expense ratios, etc. • Market performance – turnover, market share, growth, etc. • Customer satisfaction – CSI • Operating performance – operating cycles, lead times, resource efficiencies • People performance – productivity • Climate and culture
The definition takes the form of ..
• Metrics or parameters – e.g. customer satisfaction index, growth in market share, etc. • Achievement of performance is indicated through measures - for measures to be effective, appropriate systems need to be established, so that information can be captured and measurement is reliable. • Annual performance targets are called objectives
The Process of Performance Planning
• Defining Objectives e.g. amongst the top five • Setting goals e.g. sales of Xunits/20% market share • Specifying measures – units sold, Making it happen • Execution of plans • Monitoring and reviewing progress • Assessment and mid course correction
An Objective is …..
• „ an aim or end of action?
• „an aim or guide to intermediate decisions and action?
E.g highest market share, quality at a value for money
This is how objectives help…
• Creates a unified sense of purpose across the organisation units
• This in turn can help the integration process • Bring focus in efforts • Impact organisation effectiveness Therefore, objectives are the start of the organisation performance planning process
A Scenario With and Without Objectives
Think of the waste from the countless decisions made every day which could have been made better if the desired objectives had been more apparent to the decision-maker. …..If you ask a number of managers to write down their principal objectives, you may get strongly conflicting answers. The results??
Collectivity of indl. obj Efforts
?
A Scenario With and Without Objectives
Collectivity of indl. obj Efforts Organisation Obj.
“ unless there is a purpose, there is no reason why individuals should try to co-operate together at all….” “ Every organisation and every part of every organisation must be an expression of the purpose of the undertaking concerned or it is meaningless and therefore redundant.”
Effective Objectives Are….
• A guide to action - movement • Suggest certain types of action – direction • Suggestive of tools to measure and control effectiveness – help to remain on track • Ambitious enough to be challenging – take us forward • Suggest cognizance of external and internal constraints – realistic and achievable • Related to both broader and the more specific objectives at higher and lower levels in the organisation – provide clarity of backward and forward linkage
Systems of Organisational Performance Planning
• Scorecards – Balanced Scorecard, Performance Scorecards • Business Plan Documents
• Annual Business Planning • Budgeting
Planning in the absence of formally defined objectives
• Budgets
• Business plans
Absence of formally set corporate objectives cannot be an excuse to avoid performance planning
How to derive objectives….
•
• •
Start with the statement of broad objective
lead from there to indicators and measures Define possible activities that help accomplish the larger objective E.g.
• Objective – largest player in the market • Indicators and measures – market share Possible activities – creating distribution network Contd….
•
How to derive objectives….
• As this process continues across the organisation, sub-objectives for different functional units begin to emerge. This is where the process of alignment becomes crucial; one is also able to visualise the cascading effect
The process requires room for conflicts, back and forth movement, adjustments as one analyses the internal and external environment, the past and the future
•
•
Deriving Objectives --- Beyond the system and the structures
• • • • • Creativity Motives An experienced need for renewal Locating responsibility Involvement and participation – complementing and collaborative relationships
Effective communication as a process goal Sharing and mutuality as a process goal
Implementing The Planning Process
• This is a top down process
• Management committees to analyse organisation and business needs, market and environment forces and determine areas of performance. Herefrom the definition of performance in the specific context will emerge. • The process of involvement and collective thinking provides space for different perspectives, a comprehensive view and a touch with ground realities.
Contd.
Implementing The Planning Process
• Once performance is defined, performance metrics can be specified
• Performance metrics are suggestive of the measures of performance. • Ensure that the measurement systems are in place to appropriately capture the information so that measurement is reliable
• Communicate the objectives, metrics, measures and the measurement systems to the different constituents viz. business units, teams, function units, individuals.
The Big Question
Does performance planning ensure that performance will happen?
Yes, The probability increases, provided
• • • • Right objectives and goals Commitment across levels The execution plan is in place Time pacing v/s event pacing
• Managing transition • Execution as an organisation agenda Message focus on both - planning and execution
From Organisation Performance Planning Flows Performance Planning for Business Units, Function Units and Their Teams And, from there flows Individual Performance Planning THE CASCADING EFFECT
The Context of Individual Performance Planning
• Role occupied by the individual
• Organisation performance goals • Team performance goals
The Cascading Effect Alignment
Individual Performance Consists Of…
• Knowledge ( cognitive ability)
• Attitude (affective ability) • Skill – technical & human ( active ability)
The Operational Aspects of Individual Performance
• Front Ending – knowledge and skill (technical)
• Back Office – Attitude (Managerial Style) • Systems Compliance – Skill (human) & Attitude
• Team Behaviour – Skill (human) & Attitude
The Individual Performance Appraisal
Fundamentals
• Why does the organisation want an individual performance review system • What kind of a system does it want to have • How to carry out the review • How to make it effective
Fundamentals(contd.)
• Concept • Purpose • Process
•Whose performance •Review by whom
•System design
•What analysis
Concept of Individual Performance Review
A process whereby a formal review of an individual staff member?s performance is jointly carried out by him along with his superior authority at a mutually agreed periodic interval. The performance outcome is discussed in the context of the individual staff member?s role and the key performance areas and review of achievements against the specific performance objectives set for the particular period.
Purpose
Individual Level • Role clarity • Focus their efforts • Identification of strengths and scope for improvement • Opportunity for self reflection
Team Level • Diad communication • Environment created
Organisation Level • Staff development • Data for HR systems • Potential identification • Performance culture
What Kind of System
• Closed - superior, unilaterally, in confidence
• Open – where reviewee also has a role to play –
typically self appraisal, immediate superior, review committee; recent trend for 360 degrees where peers, subordinates and customers also have a role to play
Thank You
doc_460432176.ppt
This is a presentation explains about the performance management evaluation for employee as well as organizations.
Managing Organisational and Employee Performance
The Basics …..Some Questions
• What is performance management?
• How do we define „performance?? – Defining performance in the context of an organisation?s needs • Distinguishing between between individual and
team performance? Business and organisation
performance? • What is the concept of „performance metrics??
The Basics …..Some Questions
• Why does performance need to be
managed?
• Why is organisation goal setting required?
• How can organisation performance
planning and management be done in the
absence of a formal goal setting process?
The Concept
• For an individual or an individual organisation „performance? can take on a relative meaning – i.e. It can mean different to different organisations or different individuals
• The meaning would depend upon several circumstances e.g. stage of organisation growth and life cycle, organisation culture and learning orientation, external environment and what the organisation must do to remain in business
The Concept
• „performance? also has an absolute context there are globally acknowledged performance standards e.g. ISO certification for quality, PCMM levels, six-sigma.
Performance Constituents
• Organisation – macro standards, absolute achievements – COLLECTIVITY
• Business – bottom line (financial), top line (market), operational performance (cycle times, per unit indices) – TEAM, INDIVIDUAL COLLECTIVITY • Individual – key peformance areas, individual performance targets
Aligining Performance
Organisational Performance
ORGANISATION
TEAM
Business/Operational Performance
Individual
Individual Performance
Performance Management
“A
process
for
establishing
a
shared
understanding about what is to be achieved,
and how it is to be achieved, and an approach
to managing people that increases the
probability of achieving success.”
Hay Management Consultants
Performance Management
“A process for establishing a shared understanding,
an approach to managing and developing people in a way which increases the probability that it will be achieved in the short and longer term”
Armstrong
Performance Management
“Performance Management is a way of translating
corporate goals into achievable objectives that cascade down throughout the organisation to produce optimum results.”
IRS Management Review
Performance Management
“Performance Management is a means of getting better
results from the organisation, teams and individuals within an agreed framework of planning goals, objectives and standards.”
Armstrong and Murlis
PM is all about managing individual performances to achieve
organisational performance
Key Themes in Performance Management
• Process • Concerned with the organisation and the individual both • Concerned also with alignment of individual and the organisation • Focus on results – organisation outcomes • „shared understanding? of the meaning of performance • Emphasis on planning for performance • By implication, communication is an important part of the process.
Performance Appraisal and Performance Management
Appraisal • Retrospective • Greater focus on individual • Judgemental • Minimum role for appraisee
Management
• Forward looking • Broader in scope • Involvement and participation - trust • Diagnosis and analysis important part of process
Performance Appraisal and Performance Management (Contd…)
Appraisal • Annual exercise • Can be top-down system • Often linked to pay • Owned by the HR department
Management
• Focus on Organisation outcomes • Continuous process, more dynamic • Owned by organisation and line management • May or may not be linked to pay
The Shift From Appraisal to Management Has Come Due to….
• Business Concerns – competition, external environment
• Advances in management theory • Technological developments – imply performance expectations • organisation restructuring – changing organisational processes • Inadequacies of performance appraisal
And its objectives are …..
• Clarify What is to be achieved – planning for performance • Create capability for performance achievement • Reward and recognise performance • Institutionalise a process of continuous review and feedback • Involve staff members in the performance achievement process
Perspectives of Performance Management
• System for managing organisational performance
– setting corporate objectives, detailed set of plans, budgets, etc., systematic review of performance of all functions and services
• System for managing employee performance – „shared activity between the manager and the managed? • System for integrating the management of organisational and employee performance – defns.
Activities in Performance Management
• Planning for performance – goal setting
• Facilitating performance – empowering
• Creating capability for performance – training and development
• Review of performance – appraisal and feedback • Acknowledging performance – reward and recognition
Moving Beyond Systems, Tools and Techniques
• P = A + M + O (Ability, motivation &
opportunity)
• Performance culture – empowerment, resourcefulness, • Engaging the individual – aligning self and professional goals
Organisation Performance Planning
Setting Organisation Objectives
Defining Performance
• Financial performance – PAT, PBT, shareholder returns, expense ratios, etc. • Market performance – turnover, market share, growth, etc. • Customer satisfaction – CSI • Operating performance – operating cycles, lead times, resource efficiencies • People performance – productivity • Climate and culture
The definition takes the form of ..
• Metrics or parameters – e.g. customer satisfaction index, growth in market share, etc. • Achievement of performance is indicated through measures - for measures to be effective, appropriate systems need to be established, so that information can be captured and measurement is reliable. • Annual performance targets are called objectives
The Process of Performance Planning
• Defining Objectives e.g. amongst the top five • Setting goals e.g. sales of Xunits/20% market share • Specifying measures – units sold, Making it happen • Execution of plans • Monitoring and reviewing progress • Assessment and mid course correction
An Objective is …..
• „ an aim or end of action?
• „an aim or guide to intermediate decisions and action?
E.g highest market share, quality at a value for money
This is how objectives help…
• Creates a unified sense of purpose across the organisation units
• This in turn can help the integration process • Bring focus in efforts • Impact organisation effectiveness Therefore, objectives are the start of the organisation performance planning process
A Scenario With and Without Objectives
Think of the waste from the countless decisions made every day which could have been made better if the desired objectives had been more apparent to the decision-maker. …..If you ask a number of managers to write down their principal objectives, you may get strongly conflicting answers. The results??
Collectivity of indl. obj Efforts
?
A Scenario With and Without Objectives
Collectivity of indl. obj Efforts Organisation Obj.
“ unless there is a purpose, there is no reason why individuals should try to co-operate together at all….” “ Every organisation and every part of every organisation must be an expression of the purpose of the undertaking concerned or it is meaningless and therefore redundant.”
Effective Objectives Are….
• A guide to action - movement • Suggest certain types of action – direction • Suggestive of tools to measure and control effectiveness – help to remain on track • Ambitious enough to be challenging – take us forward • Suggest cognizance of external and internal constraints – realistic and achievable • Related to both broader and the more specific objectives at higher and lower levels in the organisation – provide clarity of backward and forward linkage
Systems of Organisational Performance Planning
• Scorecards – Balanced Scorecard, Performance Scorecards • Business Plan Documents
• Annual Business Planning • Budgeting
Planning in the absence of formally defined objectives
• Budgets
• Business plans
Absence of formally set corporate objectives cannot be an excuse to avoid performance planning
How to derive objectives….
•
• •
Start with the statement of broad objective
lead from there to indicators and measures Define possible activities that help accomplish the larger objective E.g.
• Objective – largest player in the market • Indicators and measures – market share Possible activities – creating distribution network Contd….
•
How to derive objectives….
• As this process continues across the organisation, sub-objectives for different functional units begin to emerge. This is where the process of alignment becomes crucial; one is also able to visualise the cascading effect
The process requires room for conflicts, back and forth movement, adjustments as one analyses the internal and external environment, the past and the future
•
•
Deriving Objectives --- Beyond the system and the structures
• • • • • Creativity Motives An experienced need for renewal Locating responsibility Involvement and participation – complementing and collaborative relationships
Effective communication as a process goal Sharing and mutuality as a process goal
Implementing The Planning Process
• This is a top down process
• Management committees to analyse organisation and business needs, market and environment forces and determine areas of performance. Herefrom the definition of performance in the specific context will emerge. • The process of involvement and collective thinking provides space for different perspectives, a comprehensive view and a touch with ground realities.
Contd.
Implementing The Planning Process
• Once performance is defined, performance metrics can be specified
• Performance metrics are suggestive of the measures of performance. • Ensure that the measurement systems are in place to appropriately capture the information so that measurement is reliable
• Communicate the objectives, metrics, measures and the measurement systems to the different constituents viz. business units, teams, function units, individuals.
The Big Question
Does performance planning ensure that performance will happen?
Yes, The probability increases, provided
• • • • Right objectives and goals Commitment across levels The execution plan is in place Time pacing v/s event pacing
• Managing transition • Execution as an organisation agenda Message focus on both - planning and execution
From Organisation Performance Planning Flows Performance Planning for Business Units, Function Units and Their Teams And, from there flows Individual Performance Planning THE CASCADING EFFECT
The Context of Individual Performance Planning
• Role occupied by the individual
• Organisation performance goals • Team performance goals
The Cascading Effect Alignment
Individual Performance Consists Of…
• Knowledge ( cognitive ability)
• Attitude (affective ability) • Skill – technical & human ( active ability)
The Operational Aspects of Individual Performance
• Front Ending – knowledge and skill (technical)
• Back Office – Attitude (Managerial Style) • Systems Compliance – Skill (human) & Attitude
• Team Behaviour – Skill (human) & Attitude
The Individual Performance Appraisal
Fundamentals
• Why does the organisation want an individual performance review system • What kind of a system does it want to have • How to carry out the review • How to make it effective
Fundamentals(contd.)
• Concept • Purpose • Process
•Whose performance •Review by whom
•System design
•What analysis
Concept of Individual Performance Review
A process whereby a formal review of an individual staff member?s performance is jointly carried out by him along with his superior authority at a mutually agreed periodic interval. The performance outcome is discussed in the context of the individual staff member?s role and the key performance areas and review of achievements against the specific performance objectives set for the particular period.
Purpose
Individual Level • Role clarity • Focus their efforts • Identification of strengths and scope for improvement • Opportunity for self reflection
Team Level • Diad communication • Environment created
Organisation Level • Staff development • Data for HR systems • Potential identification • Performance culture
What Kind of System
• Closed - superior, unilaterally, in confidence
• Open – where reviewee also has a role to play –
typically self appraisal, immediate superior, review committee; recent trend for 360 degrees where peers, subordinates and customers also have a role to play
Thank You
doc_460432176.ppt