PERFORMANCE MANAGEMENT
PROCESS & CYCLE
PERFORMANCE MANAGEMENT
CYCLE
Performance Management
Objective Setting
=
and what is expected?
Objective
setting
The
Individual
Recognition
Performance targets, measures
and standards exists
Performance
monitoring
Individual know when to perform
Resources
Identify which objectives are
essential and which are desirable
Feedback
=
Objectives need to be Defined,
agreed and written and be SMART
Performance Management
Objective
setting
The Individual
Recognition
The
Individual
Performance
monitoring
Resources
Feedback
Capability to perform as
desired - skills and
knowledge
Willing to perform
Performance Management
Resources
People
Objective
setting
The
Individual
Recognition
Equipment, materials
Information
Performance
monitoring
Resources
Feedback
Plans
Money
Performance Management
Feedback
Objective
setting
Relevant, immediate and frequent
The
Individual
Recognition
Focused on critical success factors of
task behaviour
Performance
monitoring
Resources
Feedback
Constructive, balanced and specific
Performance Management
Performance monitoring
Interim reviews of performance
Objective
setting
The
Individual
Recognition
Identify interim targets
Take action to remedy poor
Performance
monitoring
Resources
Feedback
performance as necessary
Performance Management
Recognition
Positive if performance is as
Objective
setting
expected
The
Individual
Recognition
Could be linked to performance
related pay or bonus
Performance
monitoring
Resources
Feedback
If performance is not up to
standard identify problem and
communicate need for
improvement
PERFORMANCE MANAGEMENT CYCLE
planning performance agreement
role definition
objectives
competencies
performance improvement
personal development
Review performance
dialogue and feedback
agree strengths and any
areas for improvement
build on strengths you are
particularly strong in this area
how can you make
even greater use of them?
Act
carry out role
implement performance
improvement plan
implement personal
development plan
Manage performance
throughout the year
monitor performance
provide continuous feedback
provide coaching
deal with under-performers
PERFORMANCE PLANNING &
AGREEMENT
Role Profiling
Objective Setting
Performance measurement and Assessment
Performance Planning
Development Planning
The performance Agreement
ROLE PROFILING
Developing Role Profiles
Defining Key Result Areas
Define Technical Competencies
Define Behavioral Competencies
Core Values
DEFINING KEY RESULT AREAS WHAT & WHY
What do you think are the most important thing
you have to do?
What do you believe you are expected to
achieve in each of these areas?
How will you anyone else know whether or
not you have achieved them?
DEFINING TECHNICAL COMPETENCIES
KNOWLEDGE, SKILLS AND EXPERIENCE
To perform the role effectively, what does the
role holder must do with regards to each Key
result areas.
What knowledge and skills in terms of technical,
procedural, problem solving, communication
skills does role holder possess?
How will anyone know when the role holder has
done work well?
DEFINING BEHAVIORAL COMPETENCIES
Personal drive
Business Awareness
Team work
Communication skills
Customer focus
Developing and motivating others
Flexibility
Leadership
Problem solving
Planning , organizing skills
CORE VALUES
Integrity
Impartiality
Professionalism
Client focus
Efficiency
Mutual Respect
Honesty
GOAL SETTING
SMART GOALS
Specific
Clearly stated what to do and how to do?
Measurable States how the performance will be
measured?
Achievable
Goal targets are agreed between the
manager and employee.
Realistic
Is relevant to the employees job role and
to the organization.
Time-bound
a target set for achieving the objective
SMART GOALS
1. What should you do?
2. When?
3. What Standards?
SMART GOALS
Example:
The employee will write report for the department at the end
of each week with zero grammatical errors.
What is expected?
Write report for the department
When?
End of each week
What standards?
Zero grammatical errors
TYPES OF GOALS
On-going role or work goals
Tasks/projects
Targets
Performance standards
- Behavior
- Values
Performance improvement
Developmental/learning
GOOD OBJECTIVES
Consistent
Precise
Challenging
Measurable
Achievable
Agreed
Time related
Focus on team work
INTEGRATION OF OBJECTIVES
Corporate
objectives
External factors influence
Competition
Market factors
Customer feedback
Legislation
Functional
objectives
Internal influence
Team Objectives
Individual
objectives
Strategic plans
Resource
available
Core Values
Performance
OBJECTIVE SETTING CHECKLIST
Has the objective-setting process been based on an agreed and upto date role profile that sets out key result areas?
Has objective setting been carried out jointly with your manager?
Are your standards and targets clearly related to the key result areas
in your role profile?
Do your objectives clearly and specifically support the achievement
of your team and functional objectives and, ultimately, corporate
objectives. If so, how?
Are your objectives specific? Are they realistic and attainable?
Do they provide some challenge to you?
Has a time limit for their achievement been agreed?
How will you know that your objectives have been achieved?
Have any problems you may meet in attaining your objectives been
identified and has action to overcome these problems been agreed?
PM MEASUREMENT AND ASSESSMENT
OUTPUT OUTCOMES AND INPUTS
Classification of output and outcome measures
Output is the result that could be measured quantifiably.
Financial measures income, shareholder value, added
value, rates of return, costs;
Units produced or processed, throughput;
level of take-up of a service;
Sales, new accounts;
Time measures speed of response or turnaround,
achievements compared with timetables, amount of
backlog, time to market, delivery times.
OUTCOME MEASURES INCLUDE
Outcome is visible effort in the result but cannot be
measured quantifiably
Attainment of a standard (quality, level of service etc.);
Changes in behavior
Completion of work/project
Acquisition and effective use of additional knowledge
and skills
Reaction judgment by others, colleagues, internal and
external customers.
INPUTS
(COMPETENCY AND UPHOLDING CORE VALUES)
Degree of knowledge, skills and behavior
demonstrated to achieve the target goals
Example:
Builds effective working relationships with others
Takes the initiative to address problems
Seeks knowledge related to emerging issues
Shares know-how and information with co-workers
Responds effectively to customer concerns
ASSESSING COMPETENCIES
Positive Indicators
Achieves high level of performance
from team.
Defines objectives, plans and
expectations clearly.
Continually monitors performance
and provides good feedback.
Maintains effective relationships
with individuals and the team as a
whole.
Develops a sense of common
purpose in the team.
Builds team morale and effectively
motivates individual members of the
team by recognizing their
contribution while taking appropriate
action to deal with poor performers.
Negative Indicators
Does not achieve high levels of
performance from team.
Fails to clarify objectives or
standards of performance.
Pays insufficient attention to the
needs of individuals and the
team.
Neither monitors nor provides
effective feedback on
performance.
Inconsistent in rewarding good
performance or taking action to
deal with poor performance.
STEPS TO WRITE GOALS (KRAS) FROM
JOB DESCRIPTIONS
Step 1: Go through the Job Description of the employee.
Step 2: Make a list of the functions and responsibilities that
are critical to the job.
Categories in two sections :
1. Those that can be measured in numbers, percentages or
yes/no answers.
2. Those that cannot be measured easily in numbers or
calculated.
STEPS TO WRITE GOALS (KRAS) FROM
JOB DESCRIPTIONS
Step 3: write short self-explanatory definition of each Goal.
If you plan to follow BSC (Balanced Score Card) Pattern, then
categorize each goal into one of the following categories:
Customer
Financial
Internal Business Process
Learning & Growth.
Step 4: Describe each Goal (KRA). Make sure you mention
a measurable target and a realistic timeframe based on your
business plan.
EXAMPLE OF GOAL SETTING FROM
JOB DESCRIPTION OF A SALES
MANAGER
Goal (KRA)
Category
Improve Performance Learning &
of Sales Executives Growth
Definition and Measures
To ensure that all sales executives meet/exceed the sales
targets provided to them.
Track the performance of sales team and guide them
consistently meet sales targets.
Target: US$ 500,000 per quarter for the whole team.
Development of Sales Customer
Action Plans
Conducts market research and develops sales plans and
updates periodically based on changing market scenarios and
insights from the prior quarters.
Sales plan must be reported every quarter to management
team for analysis and approval.
Target: Review, update, management approvals on a quarterly
basis
Management
reporting on Sales
Performance
Internal
Business
Process
Create and send accurate monthly reports.
Reports should indicate the following:
Plan vs achieved
Reasons for any shortfalls
SWOT analysis.
Next month targets
Target: Reports to be submitted by 7th of Every Month for the
prior month.
Customer
engagement
Customer
To ensure that customers are happy with our services and their
needs are being met
To meet customers, get their feedback on customer feedback
Goal (KRA)
Create and submit
proposals and
responses to RFQs
Category
Customer
Definition and Measures
Reply to Request for Proposals, Tender Notices, and Price
Quotations in a Timely manner.
Submit a competitive analysis, budgeting, expected
closure price and customer details in the separate
customer profile document.
Target: All Proposals to be submitted for management
review at least 3 days prior to submission date
Timely Collections
Finance
To ensure that the customers clear their dues within existing
timelines.
Work with the accounts to identify any delays and with the
Operations to mitigate any issues being seen at the client end.
Target:
Improvement in cash flow by 7% QoQ
Decrease in receivables by over 60 days by 25% in Q1,
20% in Q2, 35% in Q3 and 20% in Q4
Adherence to company Internal
policy
business
process
To ensure that the company policies are followed by all team
members and the following activities are carried out as per the
assigned SLA
Application for leave and its approval within 3 days.
Filling in the travel sheets with approvals from you
Submission of expense reimbursements within 5 days of
completion of travel
Nominations for rewards on quarterly basis
KRA, KPA AND KPI
Key Result Areas(KRA) : is like overall function of an
employee. General areas of outcomes or outputs for which
the department's role is responsible
Key Performance Area (KPA) : Performance Required
areas, the areas within the business unit, for which an
individual or group is logically responsible.
Subdivision of KRA
Key Performance Indicator(KPI) : How , When you know
you have achieved your assigned targets? It is simply matric
attach to the target.
SAMPLE KRA AND KPA
Role Product Manager
Goal Ensuring delivery of quality product within schedule.
Key Result Area
Customer Satisfaction.
Product Management.
Operational Cost Control.
Quality Check.
Record keeping.
Key Performance Areas
Maintaining good working condition in plant.
Optimum Resource Utilization.
Process Improvement.
Safety and Prevention planning and control.
REVIEW SAMPLE ROLE PROFILES
PAG E 5 1 O F A R M S T R O N G B O O K 2
ASSIGNMENT 1 (PRESENTATION)
GROUP OF TWO
Select a Job / JD and make its role profile
Role title
Department
Purpose of role
Report to
Key Result Areas & Key Performance Indicators
Technical Competencies ( Knowledge, skills, experience)
Behavioral Competencies
Dimensions
Attach plagiarism report 0% allowed (send your assignment at
[email protected] before coming to the class)
ALIGNMENT OF STRATEGIC PLAN WITH
PERFORMANCE
Organizations Strategic Plan
Mission, Vision, Goals, Strategies
Units Strategic Plan
Mission, Vision, Goals, Strategies
Job Description
Tasks, KSAs
Individual
KPA, KPI
Results, Behaviors, Developmental Plan
VARIATION IN PERFORMANCE
MEASURES
PAGE 65 ARMSTRONG
BOOK 2
PERFORMANCE PLANNING
The performance planning part of the
performance management sequence consists of a
joint exploration of
What individuals are expected to do
What individual is expected to know
How they are expected to behave
Develop their skills and capabilities.
The plan also deals with how their managers will
provide the support and guidance they need.
DEVELOPMENT PLANNING
For individuals, this stage includes the preparation and
agreement of a personal development plan.
It may include formal training but, more importantly, it
will incorporate a wider set of development activities;
Self-managed learning,
Coaching
Mentoring
Project work
Job enlargement
Job enrichment
Job shift
THE PERFORMANCE AGREEMENT
Role requirement
Objectives
Performance measure and indicators
Knowledge, skills and competence
Corporate core values and requirements
A performance plan
A personal development plan
Process details
EXAMPLE OF DIFFERENT
PERFORMANCE MANAGEMENT
PROCESS
PERFORMANCE MANAGEMENT PROCESS AT CENTRICA
What
Centrica strategy and
management agendas
Business and
individual performance
contract
Financial
Customer
Operational
People
Performance rating
Potential rating
Development plan
How
Creates a compelling
future
Inspires others to
achieve
Demonstrates a
passion for customers
Delivers great
business performance
Learns and shares
knowledge
MANAGING PERFORMANCE AT STANDARD CHARTERED BANK (2)
The process
Global for all employees
Accelerate a high performing organization
Performance coaching
throughout the year
Regular open discussion:
integrates performance, learning
and development, reward and
individual engagement
addresses performance issues
under-performance not tolerated
Final review (Nov/Dec)
15 business rating scale
AD values rating scale
Additional feedback form
Cascaded level down rating
reviews
Objective setting (January)
Financial/business objectives
Two core management objectives
Values objectives for all
Interim review (July)
Formal step-back
Tracking rather than
rating
PERFORMANCE MANAGEMENT AT PFIZER INC
Performance planning
Total compensation
Ongoing
coaching and
feedback
Performance review
Guidance: Have a dialogue and document it
Development
PERFORMANCE MANAGEMENT AT ASTRA ZENECA (2)
Stage 1
Business roles
Plan
Stage 2
Performance
planning
Evaluate
Stage 4
Stage 3
Performance
Performance
measurement
development
Do
PERFORMANCE MANAGEMENT AT THE VICTORIA & ALBERT MUSEUM
Job description
(updated)
Evidence
(departmental)
Corporate
plan
Evidence
(individual)
Departmental
objectives
Performance
standards
Individual
objectives
Attributes
Personal
development
plan
Assessment
Countersigning officer review
Ratings
pay
decisions
