Performance Management System

Mahindra N Mahindra Ltd

-By Devi Shetty

(Batch 16-Roll no-37)
 What is PMS ?
• PMS is the process of assessing progress
towards achieving predetermined goals. It
involves building on the processes, adding
the relevant communication and action on
the progress achieved on these
predetermined goals, helps the organization
to achieve their strategic goals
Essential Components of a Performance Management System
are:

– A performance plan is negotiated between a manager

and employee for a given period (usually one year).
– During the year the manager gives employees
feedback
– Performance is appraised at year-end
– decisions are made to reward, discipline or develop
employees.
– The cycle is completed with a new performance
plan.
 THE MAHINDRA GROUP

– Mahindra is the market leader in multi-utility

vehicles in India.
– Only Indian company among the top three
tractor manufacturers in the world.
– The Group has a leading presence in key
sectors of the Indian economy, including the
Automotive, financial services, trade &
Logistics, Automotive components,
Information Technology and Infrastructure
Development.
Process of Goal Setting in Mahindra
STRATEGY, VISION, MISSION
&BUDGET

BUSINESS GOALS

ORGANIZATIONAL
OBJECTIVES

DEPARTMENTAL OBJECTIVES

ROLE / INDIVIDUAL
OBJECTIVES

KEY RESULT AREA (KRA)

 What is balance score card ?
• Balance Score card is a unique management method which
outperforms the traditional methods of performance
evaluation owing to its ability to give an integrated view of
the organization, by incorporating both the financial and non
financial parameters. It can be used to significantly improve
implementation of objectives and strategies.
• It provides a mechanism for controlling and monitoring the
organizational progress. A balance scorecard is a way of
communication to keep the team members up-to-date, help in
translating strategy into operational and measurable terms and
achieve strategic implementation.
 Departmental Goal Setting

• Balanced Score Card approach

• By Robert S. Kalpan and David P. Norton’s,

1992

• Measures performance on 4 perspectives

• It improves financial performance by
making better resource allocation,
investment trade-offs and gives feedback on
past performance which serves as direction
for future course of action. It directs the
Physical, human and financial resources to
plan and policies which would give the
maximum output.
Performance is measured in 4 perspective
CUSTOM
ER
FINANCI
AL

INTERNAL
PROCESS

L&D

BSC
 How do customer see us? Feedback

What we must Excel at? Internal Process

Can we continue to improve and create value? Learning and Development

How well do we look at our stakeholders? Financial

INDIVIDUAL GOAL SETTING
Communication
KRA Setting
Workshop

Performance Mid Term

Appraisal Review

Feedback and
Counseling
 Step 1 : Communication Workshop

• 2 day workshop in the month of May.-June

• ‘KRA Setting’ and how to conduct

performance appraisal’

• Useful to both Appraiser and Appraisees

 Step -2 KRA Setting
• Individual Goal Linked to Business.i.e. 3-5
KRA’s
• Set after discussion between appraiser and
appraisee
• Forms a basis for the calculation of
performance payout
• The KRA sheets are sent to Corporate HR
Department
 Step-3 Mid Term Review
• Conducted in the month of October
• Measure and evaluate performance in terms
of the goals set
• Discussion of correction measures 
 Step-4 Performance Appraisal
• Done in the month of April
• Employees are reviewed on the basis of
achievement of KRAs, assessment of
significant tasks other than KRAs
• Leadership competencies - M&M Ltd has
adopted 7 leadership competencies
• Employee’s feedback is recorded
• Discussion is held between appraiser &
reviewer to jointly arrive at overall rating of
the employee
• For the performance pay calculation, the
overall performance is divided into two
parts:
-Business Performance
-Individual Performance
Step-5 Feedback and Counseling
• Appraiser gives feedback to the subordinate
immediately after the final performance
appraisal
• Reviewing if all the employees have got the
appraisal report
 Why performance appraisal is needed?

• Helps in identifying Areas for

Improvement.
• Provides development opportunities for the
growth of people.
• Generate Data for actions relating to
Increments, Promotions, etc.
Thank you.