Performance management

Executive Education series

Performance Management and Appraisal Facilitator: Dr Tom Cockburn AFNZIM

Electronic copy available at: https://ssrn.com/abstract=3239523

Learning objectives

TSWBAT identify the key elements of performance management

role of line managers in how organisations manage and measure performance TSWBAT identify and explain key trends that affect the performance management process in organisations TSWBAT key determinants of individual and team performance TSWBAT identify a set of important “do’s and don’ts” to follow when carrying out appraisals in their organisations

http://www.youtube.com/watch?v=Lu9QWojx8qE

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The HR cycle “Managing performance well ensures integrated HR activities that are strategically aligned with the needs and objectives of the organisation. This will ensure sustained success to organisations through improved performance of staff by developing their capabilities” (Armstrong,2001).

Williams(2002) suggests that there is often a gap between the rhetoric and reality of HR in organisations. Particularly in the prevailing mindsets and lack of skills of many line managers.

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Human Resource Cycle Rewards

Recruitment and Selection

Performance

Appraisal

Training

(adapted from) Fombrun, Tichy & Devanna, 1984 27/08/2018

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Definitions Performance management is : “a process of establishing a shared understanding about what is to be achieved and how it is to be achieved” (Hartle,1995)

Performance appraisals are regular assessment of employees’ performance, contribution and professional development needs. 27/08/2018

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What is performance? • Often seen as Outputs or results of an individual or team’s activities -- e.g. Key Results areas, KPIs, KPTs, objectives, goals, accountabilities Or ‘What’ gets done.

• At organisational level outputs can be seen as measures of quantity, e.g. inventory, production costs, or in terms of Quality-scrap/wastage, Errors, delivery time/speed across the supply chain • An alternative is the ‘How’ of performance—individual or organisational values or competences i.e. Behaviours and processes •PM and measurement requires attention to both--What and How 27/08/2018

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Behaviours are often seen in terms of competences --used extensively in training, selection and recruitment and promotion as well as appraisals Terms such as competences and competencies are often used interchangeably but there is some confusion:

Competences=features of organisation and/or jobs(basic skill requirements Whereas competencies=skills of individuals that distinguish superior performance from sub-standard results.

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Aligning HR with Strategic Business Goals PM is about making sure the people are facing the same direction i.e. Lined up with the business direction Moving from disordered activities and relationships (A) to systematic goal directed action (B)

A

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B

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What is the purpose of Performance appraisal? Performance appraisals have several uses including: •Professional development of staff (identifying strengths and weaknesses in performance, implementing strategies for development) •Determining organisational training and development needs •Making and validating administrative decisions( e.g. Pay, promotion, placement, termination) •Identifying systemic factors that are barriers to, or facilitators of, effective performance. 27/08/2018

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Get Smart A structured appraisal system benefits both employer and employees in the business. Setting clear goals and SMART objectives (Specific, Measurable, Achievable, Realistic and Time-based) helps employees to better understand what is expected of them and therefore provide them with a better chance to perform well.

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Personal Individual

Individual

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Manager

Idealised model of employee-manager relations in tight labour markets?

employee

Do you see any problems here? 27/08/2018

Adapted from Hauser & Clausing,1988 Tom Cockburn


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Peak performance, Stress and appraisals

Case examples to be given in class 27/08/2018

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What performance criteria are used in your organisation to determine performance? How is it measured and what do the measures indicate? •Past performance, Current performance, training needs or Future performance, career planning, assessing promotion, salary increases, retention/dismissal, Other, e.g. tacit skills? •Who influences or chooses the measures used?

•What is the role of the line manager of person being measured? •How are organisational goals translated into individual performance criteria? •How might this process be improved?

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Other factors = capacity, will to do task, self-efficacy (belief in own ability to do task) and personality also impacts levels of knowledge, skill and motivation In essence, this boils down to

Employee Performance= can do x wants to do

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Other than the person, the factors listed impact outcomes

❑Task ❑Goal ❑Physical environment ❑Work role ❑social

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How well does the model on the previous slide fit with your perceptions of what affects performance? How easily could you use this model to consider the performance of your staff? Can you apply it to your own performance?

What problems can you identify in the use of the model in your own experience as a manager?

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Self-rating exercise in class

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Sample Balanced Scorecard

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Discuss with your neighbour the questions listed

1. If your organisation uses the Balanced scorecard what are the advantages and disadvantages?

2. How easily can it be applied to individual's performance? 3. If your organisation doesn’t use the Balanced scorecard can you identify any advantages and disadvantages? 27/08/2018

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Planning

Reviewing

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Supporting

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Critical Incidents

Critical incidents and B.A.R.S. -Activity in class

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