PERFORMANCE & COMPENSATION MGT

(HRM 751)

CHAPTER 2: THE PERFORMANCE

MANAGEMENT PROCESS
Prepared by:
Shirley Angie Sitimin
2012849092
BM7703F
 During the Presentation

You may....

 Ask questions

 Offer ideas & suggestions

 PERFORMANCE MANAGEMENT
PROCESS (PMP):OVERVIEW
 Where Performance Mgt •Performance Planning
‘Fits’?
•Managing Performance
 Definition of PMP

 Purposes of PMP •Performance

Review/Appraisal
 Responsibilities of
Manager in PMP •Performance Reward

 Responsibilities of •Challenges of PMP

Supervisor & Employee
in PMP •Conclusions
 Various Diagram of PMP
•Recommendations
WHERE PERFORMANCE
MANAGEMENT "FITS"?
How can I
help?
How are we
doing?

What is our job?

Does anybody care?

How am I dooing?

What is my job?
Source: Roger D’Aprix
 This is a pyramid showing some of the key questions
employees of organization ask to employer.

 Often employees do not know what are expected from

them.

 A fundamental step in performance management is

communicating job expectations. Absent of clear
expectations, employees do not have the required tools
to perform their job functions.

 Roger D'Aprix (2008) has identifies six key questions

employees need answered by their boss in order to
perform their job effectively.
 PERFORMANCE MANAGEMENT
PROCESS (PMP) DEFINITION
 A continuous negotiation process that calls for effective
communication (Acuff, 2008).

 Align employee's goals & to those of the organization (

Shafudah, 2010).

 PMP is defined as a continuous process where supervisors

and employees work together to establish objectives,
monitor progress toward these objectives and assess results.
With this process, employees receive regular feedback and
coaching which is a vital development process for all
employees (KSU, 2009).
 Armstrong & Baron (2005) emphasized that PMP is a
strategy which relates to every activity of organization and
its implementation depends on organizational context and
can differ from organization to organization.

 An on going cycle that underscores the need for supervisors

& employees to work together in determining the
organization & employee's goals.

 A cycle with discussions varying year to year based on

changing objectives ( Raymond, 2006).
 PURPOSES OF PMP
 To develop people & improve performance

 Allows individuals to know what is expected of them by the

organisation they work in and so they know what they need
to do to help the organisation to be a success and for them to
participate towards that success.

 To provide honest & accurate formal evaluations

 PMP purpose is to allow for a two way feedback
between supervisor and employee to aim at supporting
rewards or punishment for performance practices.

 To drive capability development. It is typically designed

to help employees understand what they need to learn
and how they need to learn it.
 RESPONSIBILITIES OF
MANAGER IN PMP

 Take an active role in the process

 Set realistic goals that aligned with the company

strategy

 Measure result objectively

 Identify needs & resources for employees

development

 Responsible to support the process throughout the

rating period
 RESPONSIBILITIES OF SUPERVISOR
& EMPLOYEE IN PMP
Supervisor

1. Provide on going performance feedback

2. Make clear company direction

3. Shared accountability. supervisor needs to provide open,

honest and constructive feedback to employee on their
performance

4. Use a variety of methods and tools when monitoring and

giving feedback about employee's performance

5. To assist the employee throughout the appraisal period in

improving aspects of performance identified as needing
improvement.
Employee

1. To actively giving inputs

2. Discuss any concerns and questions about any part of their

job or the performance management process with his or her
supervisor

3. Responsible for continuous self-assessment

4. Responsible to take personal ownership for development

by identifying and participating in career development

5. Employee need to mutually agree on performance

expectations and competencies during the developmental
plan with supervisor
 VARIOUS DIAGRAM
/MODEL OF PMP
Note: There are 4 models shown in the slides

WHY THERE ARE VARIOUS MODEL OF PMP?

 It is designed based on the suitability of the company

 The situation is different from one organization to another/within

organization

 The formulation of such model needs to be approached from a

participatory perspective

 Not all types of performance management process model are right

for companies. Luckily there are several different types that can be
chosen by an organization which will work best for the company.
 PERFORMANCE MANAGEMENT
PROCESS DIAGRAM (COMMON MODEL)
 WHY THIS MODEL?
 It recognizes the important of coaching as it connects
each stage of the model

 It calls for the alignment of employee's goals to those of

the organization

 Easy to understand & not crowded as it is 4 steps only

 Can be implement easily

 THE PROCESS:
PERFORMANCE PLANNING
 The performance planning process, where individual
objectives are linked to organisational goals, is the typical
starting point of the cycle and goal-setting usually occurs
in line with annual standard review cycles (Suutari and
Tahvanainen, 2002).

 According to Aguinis (2007), below are the elements that

been look up during the performance planning stage:

Results

 What needs to be done

 Needs to include the key accountability, specific objectives

& performance standards
Behaviours

 How job is done

 A consideration of behaviours includes discussing

competencies which is KSAs

Developmental Plan

 Identifying areas that need improvement & setting goals

to be achieved in each area

 Agree on the development plan that have been discuss

 MANAGING PERFORMANCE

 Should be done throughout the year

 Give continuous feedback & learning to employees

 Employee shares or inform on any successes or problem to

success

 In managing performance, supervisor gives employee an

opportunity to express their needs, concern and expectations
 WHAT SHOULD SUPERVISOR
COACH?
 Current performance
- "What": Objectives,
Outcomes • Career aspirations
- "How": Behaviours,
Competencies -Prepare for potential
future assignments

 Development - Using capabilities to

choose a better path
- Building future capability
- Improving personal skills
 PERFORMANCE
REVIEW/APPRAISAL

 Involves the meeting between employee & manager

to review their assessment

 Provides a formal setting in which employee

receives feedback on his performance

 Performance appraisal summarizes the employee's

contributions over the entire appraisal period which
is one year period
 When doing performance review, each employee can be
placed into one of the three categories which are:

• High Performer - Consistently exceeds standards,

proactively problem solves, takes appropriate initiative, and is
a positive influence on others as well as a good role model.

• Middle Performer - Meets standards, responds well to

others’ problem solving ideas, strives to do a good job and may
need more experience or coaching. May be influenced either by
the high or the low performer.

• Low Performer - Does not consistently meet standards,

may respond to problems in a negative way. May not recognize
the need for performance improvement.
 6 STEPS FOR CONDUCTING
PRODUCTIVE PERFORMANCE REVIEWS
 Identify what employee has done well & poorly

 Solicit feedback

 Discuss the implications of changing behaviours

 Explain how skills used in past achievements can help overcome

any performance problems

 Agree on an action plan

 Set a follow-up meeting & agree on behaviours, actions, attitudes

to be evaluated

Note: Example of 2 Appraisal forms shown in the slides

 PERFORMANCE REWARD
 A key value drivers

 Uses non-cash recognition to reward good performance

 Give rewards based on employee hard work and

outstanding performance

 Rewarding performance should be an on-going

managerial activity and not just an annual pay-linked
ritual

 According to Armstrong (2002), his conceptualisation of

‘total reward’, this comprises both financial and non-
financial elements
THE PERFORMANCE
TIMELINE
 The performance management process timeline is
different from organization to organization. It is
depends on the company to decide when to start the
performance management process.

 The timeline is either done yearly or annually, where

yearly is starting from January to December while
annually is on January to June (first half) and the other is
July to December (second half).

 The performance management process will work in one

cycle and covers 12 months period consistent with
individual's performance year starting from the date of
job confirmation.
 CHALLENGES TO EFFECTIVE PMP

 To ensure everyone's performance is managed in all areas of

their work

 To make sure the PMP was carried out in an honest manner

 Supervisor & employee need to have good negotiating skills

 Not all organisations are led by democratic leaders
where all employees are treated with trust

 Change management is a challenge in itself. In order to

manage performance one has to be mindful of changes
in the environment and to adapt to it by managing the
change
 CONCLUSIONS
 It can be concluded that in order for the process to make
sense, there should be a supervisor and employees for
successful implementation of the process

 There is a need for some leadership and management skills

to be applied as well as the consideration of personal attitude
and behaviour to ensure that the process is been lead well.
 RECOMMENDATIONS

 Send managers & supervisors for training (Example:

Leadership training, Communication skills training)

 Do proper documentations for the PMP

 Do proper research which PMP is most suitable for

the organization
 To develop a strategic plan accompanied by employee
performance plan with clear and measurable targets

 Improve their systems, rules and procedures to facilitate

effective employee performance.
 Q & A sessions

-Thank you for your kind

attention-