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PERFORMANCE

MANAGEMENT

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PERFORMANCE MANAGEMENT VERSUSPERFORMANCE APPRAISAL

PerformanceManagement

Processes used toidentify, encourage,

measure, assess,improve, and reward

employee performance

Performance Appraisal

The process of assessinghow well employees

perform their jobs andthen communicating that

information to theemployees

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Per f or mance

Management

Pr ocess

Performance Planning &Goal setting

Observationofperformance& continualfeedback

PerformanceAppraisal using apredeterminedformat

Appraisal

Interview

Using theresults for

differentorganizationaldecisions

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PM PROCESS

ConfirmSuperior in

SAP

Self

Self Evaluation ( Part A)

Self Evaluation

Self

Appraiser

Post TalentReview

update inSAP HR

Evaluator

Feed Back(Off line/ in

person)

Evaluator

Post Talent Review (Part B & C)

Appraiseescomment &

Close inSAPHR

Self

Talent Review(Off Line)

PerformanceDialogue(Off Line)

Performance Assessment , Competency Assessment & Development need identification Generation of One page report

Pre Talent Review (Part B)

EvaluatorEvaluator

Evaluator to seek Inputs onPerformance Evaluation ofsubordinate fromFunctional / Previous

Superior

Increment/Bonus letterthrough SAP

HR

Self / HR

Feedback to be

completed by

Superior and closedby Evaluatee in

SAPHR for theIncrement/ Bonusletter to be

generated.

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PERFORMANCE MANAGEMENT SYSTEM

(PMS)Consistent with the

strategic mission

Beneficial as adevelopment tool

Effectivelydocuments

performance

Viewed as fair

by employees

Useful as an

administrativetool

Is legal and jobrelated

EffectivePerformanceManagement

System

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PERFORMANCE MANAGEMENTROLES

Superiors Have to manage the performance of

subordinates

Usually do the actual appraising.Must understand and avoid problems that

can cripple PM.

Must know how to conduct appraisals

fairly.Must have skills to provide feedback.

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PERFORMANCE MANAGEMENTROLES (CONTD.)

HR department Serves a policy-making and advisory role.

Designs the PM system and process.

Provides advice and assistance regardingthe implementation of the process.

Prepares forms and procedures and insiststhat all departments use them.

Responsible for training supervisors toimprove their PM skills.

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STRATEGIC ISSUES INVOLVED

WHY is performance management done?

WHO does the assessment?

WHEN is the assessment done?

WHAT criteria is assessed?

HOW is the assessment done?

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WHY? PURPOSE OF PM SYSTEMStrategic: help top mgmt achieve strategic

objective

Administrative: furnish valid information tomake admin decisions about employees

Developmental: allow managers to coachemployees

Informational: inform employees about theirperformance and expectations from them

Organisational maintenance: provide informationto be used in HR planning and allocation

Documentational: collect information that can beused for different purposes

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WHO CONDUCTS APPRAISALS?

Supervisors ratingtheir employees

Employees

rating theirsuperiors

Multisource, or

360, feedback

Outside sources

rating employees

Team membersrating each

otherEmployees rating

themselves

Sources ofPerformanceAppraisals

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FEEDBACK SOURCES

10 = Superior or Self or Both

900 = + Colleague/Peer

1800 = + Subordinate

2700 = + Team

3600 = + Customers (Internal &External)

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360- DEGREE FEEDBACK SYSTEMINTEGRITY SAFEGUARDS

Top management support

Assure anonymity and confidentiality.

User satisfaction and motivation isessential

Clear and transparent policies on useof data

Prevent gaming of the system.

Use statistical procedures.

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WHEN?

FREQUENCY OF

APPRAISAL

Informal evaluation Continuous

Formal evaluation Annual or BiannualAnniversary date approach

Focal point approach

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WHAT?

CRITERIA USED

Traits orcharacteristics

Actualperformance

TrainingNeeds

Potential

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THE BALANCED SCORECARD

The Balanced Scorecard is a

management tool that provides

stakeholders with a comprehensivemeasure of how the organization is

progressing towards the achievement of

its strategic goals.

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WHAT IS THE BALANCED SCORECARD

Balances financial and non-financialmeasures.

Balances short and long-term measures.Balances performance drivers (leading

indicators) with outcome measures

(lagging indicators).Leads to strategic focus and

organizational alignment.

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THE BALANCED SCORECARD PERSPECTIVES

To achieve our vision,To achieve our vision,how will we sustain ourhow will we sustain our

ability to change toability to change tochange & improve?change & improve?

FinancialFinancialTo succeedTo succeed

financially, how shouldfinancially, how shouldwe appear to ourwe appear to ourshareholders?shareholders?

Internal BusinessInternal BusinessProcessProcess

To satisfy ourTo satisfy ourshareholders &shareholders &

customers, whatcustomers, whatbusiness processesbusiness processes

must we excel at?must we excel at?

CustomersCustomersTo achieve ourTo achieve our

vision, how shouldvision, how shouldwe appear to ourwe appear to our

customers?customers?

StrategyStrategy

Learning and GrowthLearning and Growth

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EACH PERSPECTIVE INCLUDES 4COMPONENTS

1. Obj ect ives: The company specifies major objectives

to be achieved under each perspective.

2. Measur es or KPI s: These are the indicators that

measure progress towards reaching the objective.

3. Target s: Targets are the values for the measures.

4. I nit iat ives: Initiatives are the actions needed to beperformed to achieve objectives and targets.