Performance Management and appraisal process in a professional services organization.

Performance Management and appraisal process in a professional services organization.
A twist in the tale.

Submitted by : Shailesh Dubey (eMEP 100)
Manoj Rajappan ( PM 04 175)
Venkat Kumar M (eMEP 121)




Contents
Abstract
What is performance management
What do organizations achieve by it
How does it work?
How does Performance Management work?
How do employees benefit from this change?
Performace management…the process
Where it can go wrong
Areas of improvement
Conclusion
Bibliography/References

Abstract
This study is a condensation of the readings on a variety of articles on Performance Management and appraisal process in different organizations. We have critically analyzed the various practices of these fields, how they affect an organization and its human resource development and management function, and the after-results of it.

For the purpose of exemplifying the topic, we have chosen a multinational Big Four professional services provider (name withheld to keep anonymity) and have examined the performance management review process, how it is done, the timelines and other factors, the various stakeholders involved in it, and how it has benefited/affected the various stakeholders involved in the process. We have also taken a case (rare, but not isolated), where the process went wrong, and the pitfalls of it. The effort has been directed towards critically examining the process as to see whether what is written and practiced is synergistic.
What is performance management?
Performance management is an interactive process where the management communicates the vision of the organization, I ts goals to every supervisor, subordinates, and employee who thereby develop group and individual goals, plan their future/expected accomplishment, and set standards to successfully achieve the firm’s vision and goals.









Being good at your own job is now no longer enough. You also have to encourage and support high performance standards from your team. You must inspire your team members to focus on a common goal and help them to use their mix of abilities to achieve it. Your team members need to know whether they are performing successfully, and you should reward their successful performance.The objectives of performance management process are to provide a foundation for professional development, a means to assess performance and an environment that facilitates effective coaching and counseling. As a result, this program focuses on both the skill development and performance evaluation. It is the responsibility of individuals to manage their own professional development. For this program to be successful, it is critical that both the Appraiser and the Appraisee to allocate time to use the available processes and applications. Performance management is not so much a set of single, independent processes; rather, it is a series of interrelated processes, the combination of which is critical to the achievement of organizational and individual performance.
Why is it important
Productivity Benefits
A growing body of research studies are identifying trends in effective performance management systems and pointing to the fact that performance management does impact organizational success.
In a survey by Developmental Dimensions International, the majority of CEO’s (67%) perceived that effective performance management systems directly influenced the following key outcomes:
· Financial Performance
· Productivity
· Product or Service Quality
· Customer Satisfaction
· Employee Job Satisfaction
What do organizations achieve by it?
Individual performance management is primarily the world of human resources management. This part of performance management is about cascading the strategic objectives of the organization down to goals for every individual, making sure that each person understands what he or she needs to do to achieve those goals, using pay for performance to keep people on track to achieve their goals and the organization’s objectives, providing frequent feedback to individuals about their performance, and analyzing data about the workforce to make human resource decisions. In brief, the employee performance management centers upon:
· Developing and communicating organization's point of view and vision on the "career experience" and navigating employees’ career
· Painting a picture of career success through current, relevant competency models
· Supplementing the existing short-term focus on performance management with a longer-term focus on career planning
· Providing tools and resources that help employees
· Let employees take more ownership of managing their careers
· Have more meaningful career conversations by improving the skills and comfort level in giving and receiving feedback and coaching
· Make the most of performance management and career planning processes (career planning to be developed)
· Better understand performance expectations and career paths
· Identify strengths, interests, and areas for improvement through self-assessment, evaluative feedback, and developmental 360° feedback
· Develop concrete actions to achieve short-term performance goals and long-term career goals through mentoring and coaching
· Simplifying and streamlining existing processes and tools to drive greater efficiency and a better experience for our people
· Building stronger ties to Coaching, Learning & Development, Resource Management, and Reward & Recognition; and analytics to identify potential needs in these areas
· Developing analytics that help us better understand our organization's bench strength
· In an effective performance management process, the organization’s strategic plan is “cascaded” down so that ultimately there is a clear path that connects individual employees to that plan. Employees know how their work contributes to the success of the organization. They also know what is expected of them, how they are doing, what is working well, and what needs improvement. Performance management done well increases satisfaction and productivity, and decreases turnover.
How does it work?
Performance management is a shared responsibility of employees and supervisors. Performance management is done best with employees, not to them. In any organization, employees are expected to be responsible for participating in all phases of the performance management process to the best of their abilities and for performing their work in a way that meets and exceeds performance expectations. Employees are also responsible for asking questions whenever necessary to understand what is expected of them and for communicating successes and problems to their supervisors to help their supervisor measure their progress or provide assistance when needed.
Effective performance management is crucial to the accomplishment of organizational goals and objectives. It is also a fundamental management responsibility. Employees need and want to know what is expected of them, how they are doing, what’s working well, and what needs improvement
Organization management should send a clear and unequivocal message to all employees that performance matters. Each employee at every level of the organization must be held responsible and accountable for their participation in this process. Management is also obligated to provide sufficient resources for the training and supporting of all supervisors and managers in the essential components of employee-level performance management. Successful implementation of performance management will lead the organizations to follow the path of creating and sustaining a performance-based, high-achieving culture.
Some of the most important, though not universally used, key components include:
1. The setting of clear performance expectations for each employee linked to the desired outcomes as set forth in the organization’s strategic plan. Performance expectations must be specific, measurable, and/or observable and must include the following:
Performance Expectations. “What” the employee is expected to do. These are expressed as results or outcomes the employee is expected to achieve in order to be fully successful; and
General Factors. “How” the employee is expected to behave. This consists of competencies that the employee is expected to demonstrate in order to be fully successful.
2. Individual training needed to support employee achievement of desired objectives.
3. Regular, ongoing coaching, feedback, and communication with employees.
4. Regular performance appraisal – the assessment of an employee’s actual performance relative to the performance expectations.
5. Timely, meaningful recognition of desired performance.

How do employees benefit from this change
The first benefit is that each employee will be able to identify his or her role in making the organization successful in achieving the goals and will have specific expectations and measurements for determining success. Another benefit will be professional development. Each supervisor and manager will be held accountable for a general factor “Staff/Team Development.” This will involve individual plans to provide the tools each employee needs to be successful.
Employees who meet or exceed expectations are recognized for those achievements under various compensation policies such as a New Pay for Performance program. Frontline employees who have earned an Overall Rating of Meets Expectations or Exceeds Expectations receive a pay increase or given a hierarchical promotion.
The motto is simple and unequivocal…employees should strive for excellence.
Recognizing excellence goes a long way toward encouraging individuals to reach higher and achieve their potential.
Performanc management…the process
The process….in my organization begins with developing and communicating our organization's point of view and vision on the "career experience" and navigating each personnel’s career. It involves painting a picture of career success through current, relevant competency models, supplementing the existing short-term focus on performance management with a longer-term focus on career planning

The employees are provided tools and resources that help them become better and more skilled professionals so as to enable them to take more ownership of managing their careers, have more meaningful career conversations by improving the skills and comfort level in giving and receiving feedback and coaching. Another objective of this exercise is to make the most of performance management and career planning processes (career planning to be developed) for employees to better understand the performance expectations and career paths, identify strengths, interests, and areas for improvement through self-assessment, evaluative feedback, and developmental 360 degree feedback.
Planning
Rewarding



Business Strategy/Goal Development
Employee Goal Setting
Development/Learning Plan

Reward & Recognition
Annual Compensation


Developing



Ongoing performance discussions
Training programs
Mentoring



Informal & Formal Discussions
Monthly, Mid-year, to
Year-end Reviews
Monitoring

The employees are provided tools and resources that help them become better and more skilled professionals so as to enable them to take more ownership of managing their careers, have more meaningful career conversations by improving the skills and comfort level in giving and receiving feedback and coaching. Another objective of this exercise is to make the most of performance management and career planning processes (career planning to be developed) for employees to better understand the performance expectations and career paths, identify strengths, interests, and areas for improvement through self-assessment, evaluative feedback, and developmental 360 degree feedback.








Introduction copy 1 Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua.
Body copy sub-heading
Body copy. Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur.
Body copy. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum. Lorem ipsum dolor sit amet minim veniam.
Body copy sub-heading
Body copy Lorem ipsum dolor sit amet, lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea. Laboris nisi ut aliquip ex ea laboris nisi ut aliquip ex ea.
Body copy. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum. Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi, quis nostrud exercitation ullamco laborisnisi ut aliquip ex e
Where it can go wrong
An analysis of the recruitment, retention, and turnover rate however gave startling insight into the reality behind the scene. For example, the average tenure of an employee (human resource/human capital!!!) was found to be 1.4 years. So much for the human resource development or so to say human resource management. The most common reason given in the exit interview was that of re-location/marriage/familial commitments. To accept this would be like an ostrich thinking it can hide from a problem by burying its head in the sand.
In summary, the human resource management, though in place, has sometimes little or no effect in helping the organization retain/sustain and groom its talent. In a survey conducted recently, an overwhelming majority of the respondents agreed that this organization is more of a stepping stone, not a career enhancer or career destination. Perhaps, the reasons lies behind the cultural, socioeconomic, and demographic factors when look into. With a burgeoning service industry and increasing demand for the best-of-breed talent, the temptation is much. Also, it’s again the proverbial organizational politics that wreaks many a career aspirations. To quote an example, an employee who was hired (in hurry) without giving him a clear picture of his role, job description/design, organizational structure, hierarchical positions, and as such. The induction, orientation, and transition for that employee, for whom it was a first MNC experience, did not go smoothly; the end result, miscommunication, ego clashes, groupism, and other evils. The employee wrote an anonymous e-mail to the Strategic level management, who in turn took their time to assess the situation. The end result, the manager/supervisor became vengeful towards this employee, ignored him by not giving him any work, or any credit for whatsoever work, castigating him in public, not providing any opportunity or advice as to plan his professional career, and in the end giving him the LOWEST POSSIBLE RATING in the performance appraisal. The result…the employee was put on a Performance Improvement Plan (PIP) which was a farce….after a couple of more months of humiliation, the employee decided to leave the organization. Again, the ugly face of the organization came in front, the employee was asked to stay and consider his decision (without any serious intention of retaining him). As it had to happen, the employee did speak his mind out to the HR Managers and other decision-makers. To anyone’s surprise, no action…just one more exit interview

Areas of improvement


What needs to be done or taken into consideration when recruiting a candidate is to look for the right attitude with that matches with the right skills. Skills can always be developed, but to develop the right attitude is often difficult or next to impossible. There should be a set of core values that needs to be defined and practiced at every level of the organization. While assessing an employee, equal consideration should be given to judge the employee on these core attributes. Some of these attributes are:















Conclusion

Performance Management is the process of analyzing the performance, goals, and accomplishment of the employees and finding areas of strengths and weakness to improve individual and team performance, based on the principles of measurement, appraisal, action, and monitoring. However, it can manifest in various forms depending on whether the aim is to further improve good performers, deal with underperformance, or to WEED OUT poor performers. Some other observations that are made during this study are:
There should be adequate senior management's leadership and support in articulating and achieving the personal/organisational goals in help ensuring alignment of objectives of performance management.
The stackholders must be discharged with clear and unambiguous responsibility for monitoring, mentoring, and improving performance of their respective teams/staff;
There should be keen focus continuous improvement in managers' skills on performance management, including objectives setting and measurement, coaching, appraising, and motivating staff;
Efforts should be made to engendering staff ownership of the performance management system by effective communication and regular feedback in the performance management processes.

Bibliography/References


sas.com magazine
Performance Management Dos and Don'ts

Management Today articleAugust 2004: Feature Straight Talk About JobAppraisals
http://performance-appraisals.org/appraisal-library/Measuring Performance - Performance Measurement

Harbard Business Review Articles
Motivating People for Improved Performance: The Results-Driven Manager Series

Performance Management That Drives ResultsLoren Gary

People and Performance: The Best of Peter Drucker on Management (Hardcover)Peter F. Drucker

Forced Ranking: Making Performance Management WorkDick Grote