Activity 1.

1 – A brief analysis of the concept and components of HPW

A growing body of research of suggests that the use of a set of HR practices, including comprehensive
employee recruitment and selection procedures, compensation and performance management systems,
information sharing, and extensive employee involvement and training, can improve the acquisition,
development and retention of a talented and motivated workforce. These practices are usually referred to
as high involvement, high commitment or high-performance work systems or HPW (Flood, et al., 2008).

It is a general approach to managing organizations that aims to stimulate more effective employee
involvement and commitment to achieve high levels of performance (Belt & Giles, 2009).

There is now a considerable amount of literature on HPW but still there is a lack of consensus as to what
the definition it and which ‘bundles’ of HR practices make for a good HP framework. In the report of Flood,
et al. (2008), the methodology adopted for establishing the four discrete elements of HPW is based on
previous researches including theirs ( (Flood, et al., 2008):

 Strategic Human Resource Management (SHRM), including management practices on

communication, training, recruitment, performance management and compensation.
- The alignment between the HR strategy and business strategy designed to improve
organizational performance; it is to help companies with the best way to meet their employees’
needs whilst upholding company goals
 Workplace Partnership System (WPS) or Employee Involvement and Participation
- This is described as a concerted effort by owners and managers to create an environment
where employees take a significant psychological stake in the success of the organization
(Guest & Peccei, 2001)
 Diversity and Equality System (DES)
- Policies that promote equality (i.e. gender, age) of opportunity and accommodate diversity
have a key role in mobilizing a growing workforce; each sound simple but in reality, both are
very complex and should be achieved together, not one or the other
 Flexible Working System (FWS)
- A work structure that modifies the time and the place that work gets done regularly. This
generally entails benefits including employee satisfaction, improved staff retention and
reduced turnover

Some examples of high-performance working ingredients according to Armstrong and Taylor (2014) using
organizations namely Halo Foods, Land Registry, Orangebox and others are as follows:
 The integration of technical advance with people development
 Continuing reliance on teamworking and effective leadership, with innovation self and team-
management skills
 Organizational changes to streamline processes, raise skills levels and release talents
 Engagement and development of existing talent and initiative in productivity improvement.
 Increasing use of cross-departmental projects to tackle wider opportunities
Activity 1.2 – A brief evaluation of the link between HPW and sustained organization
performance, employee well-being and competitive advantage

Evan and Davis (2005) illustrates that internal social structure of the organization can mediate the
relationship between high-performance work systems (HPWS) and organizational performance. HPWS
positively influence the internal social structure by facilitating bridging network ties, generalized norms of
reciprocity, shared mental models, role making, and organizational citizenship behavior (Evans & Davis,
2005).

Organizational and people capabilities drive performance and enable strategy. Fourteen characteristics,
grouped into five broad dimensions, are common to most high-performance organizations (HPO) (Bhalla,
et al., 2011):

Leadership. It is aligned and effective within organizations.

Design. The structure is lean and shows the organization’s strategic focus.

People. The organization effectively translates business strategy into the most effective people strategy,
attracting the talented and retaining same.

Change Management. The organization can drive and sustain even the biggest change, anticipate and
adapt.

Culture and Engagement. The culture is shaped to achieve strategic goals. Employees pursue corporate
objectives.

The Royal Bank of Canada or RBC, Canada’s largest bank, has experienced a significant drop in financial
performance in 2004. Carefully analyzing the situation in their organization, and by openly talking to the
employees, CEO Gordon Nixon recognized that fixing concerns of their manpower is very important for
improving financial stability and competitive advantage.

There was poor collaboration across businesses; decisions made by executive management weakened
and there was low employee engagement. The bank’s management was restructured rank-wise and
focused on revenue growth and production. Each management’s role was clearly layered and so,
expectations and accountabilities were clearly laid out.

The Senior team clarified its expectations for leadership and behavior and revised the performance
management system to reward achievements and agreed upon behavior i.e. welcoming challenge, being
solution-oriented, et al.

The bank closely monitored this three-year target and it worked; Soon after RBC’s stocks price had
doubled. Results from their survey showed that their employees strongly believe that the daily activities
and goals of employees are now aligned to that of the organization (Bhalla, et al., 2011).

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Employee wellbeing is an increasingly important area of focus for the UK government and elsewhere in
the world. It is viewed as a legitimate target of government policy in its own right but there are also reasons
to think that it may also be conducive to economic growth.

The term subjective wellbeing (SWB) is used to cover a number of different aspects of a person’s
subjective mental state. An individual SWB at work is influenced both by their own characteristics and
those of the job and workplace in which they are employed as shown by the figure below (Bryson, Forth,
Stokes, & NIESR, 2014).

FIGURE 1 – SWB CHARACTERISTICS

(Bryson, Forth, Stokes, & NIESR, 2014, p. 13)

When creating policies, it is the features of the job and workplace are of most interest as these are more
typically amenable to policy influence but an understanding of the relationship between individual
characteristics is also important to enable us to establish the results of HPW to employee well-being.

In 2011, Workplace Employment Relations Survey explored the relationship between SWB and
performance at workplace level. The level of SWB was measured using the two most studied aspect: job
satisfaction and job-related affective feelings.

Some of the significant findings include employee job satisfaction was found to be positively associated
with workplace financial performance, labour productivity and the quality of output and service (Bhalla, et
al., 2011).

In their book Creating The High Performance Work Place: It’s not complicated to develop a culture of
commitment, Bingham and Dusin (2018), they tackle how Ken Bingham, an employee of CECO, a
construction company, who has spent his thirties until retirement to finding and fine-tuning elements that
create the highest performing environment. Driven by his desire for the companies he works for succeed
and the people he works with feel valued, he has developed the philosophy and applications; one of which
is the link between HPW and competitive advantage.

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While CECO was doing good at the time, the company was experiencing losses in the market share in
some of its manufacturing lines. Executive leadership was worried about the current situation and future
forecasts. They determined that, while you can attain competitive advantage through technology,
innovation, automation, sales approaches, material utilization and customer service, all these would only
prove temporary. Sooner or later, competition would be able to find similar techniques. According to him,
80 percent of what any organization does can be done equally well by another organization. Therefore,
competitive success depends upon the 20 percent – the people (Bingham & Dusin, 2018).

Activity 1.3 – An identification of some of the main barriers to HPW

In the study conducted by the UK Commission for Employment and Skills, a great deal of literature in the
field of HPW shows that putting these systems in place are critical to success but more often than not, it
also conveys that some organizations struggle to understand how to implement them. Although there is
a widespread recognition in the academic literature that strategic alignment of bundles of HPW practices
is key, the actual things that happens in organizations do not necessarily reflect this (Campbell & Giles,
2010).

In these case studies, the UKCES have set out to understand how decisions by employers to engage with
HPW are made; how managers and leaders shape and influence practice; to explore the practices
themselves and how they affect the experience of work; and to identify barriers to the take-up of HPW
and how they are resolved – they held discussion groups with trade union representatives from a range
of sectors, to explore high performance workings and this group had very strong views on barriers in
implementing HPW.

The greatest concern was that they saw empowerment as all too often being a hollow concept with jobs
being ‘dumbed down’ through automation, lack of autonomy and de-skilling, and there is much emphasis
on performance metrics.

Another barrier they have identified was damaging performance management with a special emphasis on
forced distribution of performance ratings which makes individuals and teams compete with each other
and becomes incompatible with the purpose of HPW.

Culture was also seen as a barrier with a lot of organizations not training and developing their employees
and do not give attention to trust in the workplace. Middle managers often reflect the culture and if this is
low trust or performance driven, they are unlikely to display the management behaviors essential to HPW.

Pressure of work was also considered as a barrier without having enough time to train and develop people
to adapt to HPW.

It was also mentioned that on some ways, trade union movement has been slow to see learning and skills
as legitimate activity which did not help as well. The most noted examples that union representatives draw
on include employee involvement schemes, apprenticeship schemes, employee well being policies to
name some (Campbell & Giles, 2010).

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Activity 2.1 – Summarize the main stages of the performance management cycle and the role of
development and performance reviews

Improving performance is a never-ending process; organizations should strive to achieve the ideal
situation of cost and profit, as well as achieve customer satisfaction and gain potential future business.
There are many conceptual models on performance management but at the end, an organization should
establish one that will be a perfect fit for them (Bussin, 2013).

Performance management can contribute to the development of a high-performance culture in an

organization by delivering the message that high performance is important. It is a means of getting better
results by providing means for individuals to do better in an agreed framework.

FIGURE 2 – PERFORMANCE MANAGEMENT CYCLE

(Bussin, 2013, p. 31)

The three levels of performance management are as follows:

1. Organizational (goals, design, management) – this pertains to the relationship of the organization
to the market and basically, to the outside world.
2. Process - this pertains to the procedures that operate within the organization
3. Individual – covers the performance of every individual in the organization

Incorporating that of our performance management cycle and the existing models for performance
management, the main stages are (Bussin, 2013):

1. Defining goals, standards and measurements

- ADMM’s strategy has been enhanced into a company strategy map and balanced scorecard
that are cascaded to the different levels of our organization
- Strategy are translated into KPIs and spread across value
- Strategy cascade to the business unit levels
- Strategy cascaded to the Divisional levels
- Objectives and KPIs assigned to all divisions
- Individual evaluation framework designed to link individual performance to the company
strategy
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 2. Providing ongoing coaching and feedback
- In the whole performance management process, managers continually provide feedback and
discuss progress
- Two-way communication is key to the process
- Performance discussions should be constantly held specially when there are changes to the
perspective or direction
3. Conducting performance appraisal and evaluation discussion
- Businesses just like our organization have periodic performance appraisals; some have them
quarterly or annually
- Annual reviews, specifically year-end ones, usually focus on the employee’s accomplishments
and establishing whether or not the individual goals have been met
4. Determining performance recognition, rewards or consequences
- This is where the relationship between performance management and reward systems is
clearly established
- The criteria of this is (1) whether or not the goal was achieved and (2) the standard with which
it was achieved
- This means that the way the employee met or did not meet the defined standards of quality,
quantity, time and process, will determine the reward or consequences
5. Conduct annual development and career opportunities evaluation
- Very few organizations incorporate their succession planning in their performance
management system. In this way, the employees can know where exactly they fit in terms of
talent management
- Good systems will give employees the opportunity to have input into their career path within
the organization while very strong systems will even modify job descriptions to suit the specific
talents of each individual

There are challenges faced in performance management systems. These can lead into the system being
used for purposes other than that of which it is designed for. Some of these challenges are (Bussin, 2013):

 Some organizations believe that the actual performance appraisal process boils down to just the
appraisal form and not the other elements and aspects
 Appraisal periods are held so close to each other that there is not ample time for a comprehensive
performance
 Appraisals are often one-side (no opportunity for self-appraisal and discussion with the line
manager)
 Appraisals are seldom dynamic objectives but are not adjusted though there are dynamic changes
in the organization
 Management focuses on setbacks and same transcend the good points
 Appraisals incorporate activities and inputs rather than outputs
 Metrics are often summarized and overall ratings given with little or no regard for pockets of
excellence
 Managers are reluctant to give ‘poor’ ratings as they do not want to be regarded as ‘bad guys’ and
so compromised the integrity of the system
 Many appraisals focus on individual’s personality rather than the actual concrete performance.

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To avoid as such, the following are the important things to consider:
 Allow for self-appraisal – when the employees are able to come up with their own goals, the could
definitely make their own evaluation; this will also help Managers facilitate the evaluation and
discussion more efficiently rather than judgmental as it is a two-way process.
 Regulate the frequency of daily performance discussions
 Develop the habit of ‘notes for record’ that document all changes and agreed performance
amendment
 Make appraisals development sessions rather than just pay-related activities

Activity 2.2 – Give some examples of different ways of involving line managers in the
performance review process

Top management play a crucial role in performance management. One of their responsibilities is to
create policies that underpin an effective performance management. They then have to convince the
line managers that performance management is instrumental in achieving business goals and should be
taken seriously; this leads to maximizing employee satisfaction and productivity. Line managers have
significant tasks at hand in the cycle of performance management:

 They provide leadership and set the motion for all policies to be implemented.
 They communicate with their lower management and supervisory level about the importance of
performance management.
 They aid employees in setting their individual goals as aligned to the organizational goals
 They catch up on employee’s performance and work load.
 Provide constructive feedback
 Discuss shifts in in employee performance or behavior and suggests corrective actions for non-
achievement
 They conduct the annual performance appraisals
 Discuss development and training needs

A company included in the Performance Management Case Studies: Revolutionaries and Trail
Blazers ( (Hearn, 2016) is General Electric and it putting an end to ‘rank and yank’ performance
management. For years, it has been well-known for its annual performance ratings and forced
distribution curves. They have practiced the ‘rank and yank’ system wherein employees were
evaluated annually with the ultimate action of firing the bottom 10% in the company.

In 2015, GE replaced this with the frequent feedback and regular conversations they referred to as
‘touchpoints’ to review progress against near-term goals. This was supported by the Clear Review
performance management tool, which enables employees to capture progress against their goals,
give and request feedbacks from peers. On top of this, managers still conduct the annual appraisals
reviewing goals for the year but the ‘touchpoints’ are more founded discussions that also give
managers a more efficient means in evaluating their employees.

In our organization, Line Managers –

 Identify relevant strategy map and balanced scorecard based on the level in the organization
 Analyses contribution to the relevant scorecard

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  Defines and assigns KPIs, weights and targets and discusses with the employee

Performance management for First line managers is about (Essays, 2018):

 Establishing and building a culture within which teams and individuals can take responsibility for
developing their own skills, performance and behavior
 Enabling teams and individuals to contribute to continuous improvement of business processes
and performance
 Communicating and clarifying expectations both from management to employees and vice versa
 Working collaboratively and collectively to achieve organizational goals
 Planning and defining organizational, team and individual objectives and how to measure them

Activity 2.3 – Provide a brief evaluation of the contribution of the performance management
process to promoting challenges, capability or recognizing and rewarding talent

Performance management and reward management are closely associated topics. Performance is how
well something is done and reward is how people should be recognized for doing it. (Armstrong &
Taylor, 2014).

If carried out properly, it can reward people with non-financial rewards such as through feedback, the
provision of opportunities to achieve, the scope to develop skills, and guidance on career paths. There
are also monetary rewards such as pay increases or bonuses related to performance, competency or
contribution. In some organizations, this is the main purpose and they are motivating factors, indeed but
non-financial rewards are considered to be more impactful and longer-lasting than financial rewards.

Reward strategy provides the motivation for reward system design and operation in order to achieve
three objectives:

1. Performance
2. Competitiveness
3. Fairness

The aim is to provide a sense of purpose and direction and a basis for developing reward policies,
practices and processes. The strategy is based on an understanding of the needs of the organization
and its employees and how they can be best satisfied (Armstrong & Taylor, 2014).

The role of performance management in a reward system is to contribute to improving performance by

providing a means of recognition which is taken into consideration when formulating job designs,
reviewing job responsibilities, setting up personal development plan or even pay decisions. At the end of
the day, performance management should be about rewarding people in its broadest sense (Armstrong
& Taylor, 2014).

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Activity 3.1 – Recommend some of the ways of building trust, enthusiasm and commitment in
support of a high-performance culture

It is indeed not impossible to achieve a culture of commitment but the road is long and never-ending,
especially when you want to maintain a sustained organizational performance and a competitive
advantage.

When a leader is trusted, he has the power to influence the people who believe to go even beyond what
is expected of them. When people have a high level of trust, they will go through a path with comfort,
notwithstanding the risks. They will do the utmost because of the respect they have of the people who
lead them.

Based on the literatures reviewed for this paper and the experiences I gained in my past employment
and my current organization, I have established the following practical recommendation in building trust,
enthusiasm and commitment in support of a high-performance culture:

 Thinking positive towards people including current employees and future potential employees
 Mutual trust and respect that can be conveyed with tolerance without prejudice on gender, race,
origin and religion
 Increase level of employee involvement, interaction and empowerment
 Conducting trainings not just on technical aspects but on employee wellbeing-related aspects
such as stress and conflict management trainings and other related programs which can help
employees understand and implement techniques in reducing stress-related work concerns,
reduce absences and demonstrate consistent wellbeing.
 Establish competitive wages and benefits
 Put a reward management in place including monetary rewards, incentive vacations, et al.

Page 9 of 10
References

Armstrong, M., & Taylor, S. (2014). Armstrong's Handbook of Human Resource Management Practice. London:
Kogan Page.

Belt, V., & Giles, L. (2009). High Performance Working: A Synthesis of Key Literature. South Yorkshire: UK
Commission for Employment and Skills.

Bhalla, V., Caye, J.-M., Dyer, A., Dymond, L., Morieux, Y., & Orlander, P. (2011). High-Performance Organizations:
The Secrets of Their Success. BCG Publications, 2-13.

Bingham, S., & Dusin, B. (2018). Creating the High Performance Work Place: It's not complicated to develop a
culture of commitment. California: HPWP Group.

Bryson, A., Forth, J., Stokes, L., & NIESR. (2014). Does Workplace Wellbeing Affect Workplace Performance.
Department for Business Innovation & Skills, 1-121.

Bussin, M. (2013). The Performance Management Handbook for Emerging Markets: a practical and informative
handbook for managing performance for the world of work in Emerging Markets. Randburg: Knowres
Publishing.

Campbell, M., & Giles, L. (2010). High Performance Working: Case Studies Analytical Report. South Yorkshire: UK
Commission for Employment and Skills.

Essays, U. (2018, November). Role of the Manager in Performance Management. Retrieved from
https://www.ukessays.com/essays/business/role-manager-performance-management-5239.php

Evans, W. R., & Davis, W. D. (2005). High-Performance Work Systems and Organizational Performance: The
Mediating Role of Internal Social Structure. Journal of Management, 758-775.

Flood, P. C., Mkamwa, T., O'Regan, C., Guthrie, J. P., Liu, W., Armstrong, C., & MacCurtain, S. (2008). New Models
of High Performance Work Systems: The Business Case for Strategic HRM, Partnership and Diversity and
Equality Systems. Dublin: The Equality Authority and National Centre for Partnership & Performance.

Guest, D. A., & Peccei, R. (2001). Partnership at Work: Mutuality and the Balance of Advantage. BJIR: An
International Journal of Employment Relations (pp. 167-338). West Sussex: John Wiley & Sons, Ltd.

Hearn, S. (2016, January 5). Top 5 Performance Management Case Studies. Retrieved from Clear Review:
https://www.clearreview.com/top-5-performance-management-case-studies/

(3,159 words)

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