Performance Management System

Normally Performance Management System is linked with annual Performance Appraisal that means 

to give annual Performance Marks to the employees out of What ??????? Do not Know?  
........... Hmmmmm here is:-

1. Skills  (Weight 40%)
2. Attitude and Behaviour (Weight 40%)
3. Achieved Targets and Goals (Weight 20%)

The Person is being Evaluated here but see how?????....

OMG only attitude / skills are being focused NOT THE RESULTS.

Performance is being reviewed annually. Check the employee frustration.

Where are the facts on which performance is being reviewed?????????????????

WELL I will show performance in the ending months of the year. Remaining Year! Chillllllll :-P

WHAT WILL HAPPEN TO THE BUSINESS OBJECTIVES THEN????.. No Body knows...

Performance Appraisal Comments (Its typical remarks of local companies' employees) Enjoy the comments  

Employee:-       I did this and that for the Organization?

Organization:-   We gave you a chance to do so. ( Nice Comments :-) )

Employee:-       Sir, I want to remind you the salary increment and performance award 
                        promised by you two months before when I was admired by your good self on 
                        getting great efforts for the organization in result of which the Org got 
                        handsome profit. organization?
CEO:-               OMG Expense are increasing day by day How should we overcome that?

Employee:-       Sir, I have been given offer by another organization So I am leaving.
Manager:-         :-O Nooooooooo, Let me talk to the Management. They will retain you.     

Why he was not appraised in right way if he was an important guy that you have to retain him afterwards...

CEO:-              What is annual report of Organizational Performance this year?.
Manager:-        Sorry Sir, report could not be generated as the concerned person just left 
                        before three months and we had to do re-work. I will give you the next week. 

Next week is coming in the starting month of next year.This means in the next year :-P

CEO:-              What was the expense ratio on HR sides.
Manager:-         because of high turn over we had to spent a lot this year on recruitment.
CEO:-              Give me the performance Report of HR this year?
Manager:-        Have it pls sir.
CEO:               You did only recruitment Whyyyyyyyyyyyyy?
Manager:-         Sir, we spent much of time on recruitment. 

After evaluation and reward done what happen SEE Guys......

Colleague-01:-   I did work hard this year for the benefit of the company but got 
                         no reward:-(. 

         Did Manager gave wrong feed back earlier? :-O

Colleague-02:-   I said you earlier to do smart working Come On. 
Colleague-01:-   Hmmm, Well said this year I should do this or else looking for other 
                       opportunities.

Employee dissatisfaction creates either politics, develop the unethical culture or high turn over.

CEO:-               Lets make new plans for the next year?
New Manager:-  Sir, I just joined the company one month before I will have to study the 
                        previous Results.

CEO:-               We will not look back. We have to focus on expense. 
                                          One can see the ending Organizational Performance.

Let us have a sight on a performance management system which can be said to as to some extant an effective system. Let see how evaluation process is done and how a performance of an employee is measured.

In this system, Performance Appraisal is not the whole PMS rather an on going part of Performance Management System.

Effective Performance Management System

Performance Management System should be based on ongoing process throughout the year starting from 1st Month of the year till end of the years comprising of total three quarters. Performance appraisal activity should be throughout the years and precisely to be done at the end of each quarter.

PLANNING:

1. Initially, do planning of designing departmental organizational goals / strategies which are transferred to department and from department to individuals.
2. After every quarter job descriptions will be revised mentioning in it the Key Result Areas (Part of Organizational objectives, corporate strategies of monthly/annually).
3. Weight of each Key Result Area will be given on its priority and of being its importance in achieving the targets or set goals.
4. Employees will be handed over the job descriptions along with their Key result areas standards and rating formula.
5. Total Points of rating or weight should be as following:-

• RESULT / GOAL ---------------------Maximum
• Behaviour / Traits --------------------Minimum

MONITORING

• Set the process how to do monitoring regarding performance of Key Result Areas from upper to lower level positions or from lower to upper level positions.
• Usually, monitoring will be done from upper to lower level position in the reporting lines.
• Make balance of monitoring.

DEVELOPING   

1. On finding any triggering event, analyze the cause of trigger on following basis:-

• Lack of KSA
• Organizational issue
• Operational Issue

   2.   Make plans to remove KSA through Training Need Analyses.

RATING:

1. Rate the person after the end of each quarter regarding the achievements done in the concerned quarter.
2. Process of rating is based on normal distribution of rating as below mentioned:-

• unacceptable
• Improvement Needs
• Meet Expectations
• Exceed Expectations
• Outstanding

1. Points should be rated to each key Result Areas.
2. The rating results are forwarded to HR. HR analyses the rating forms and hold meeting with the seniors and juniors for getting signature of acceptance from both sides. If the employee is satisfied or not with the given ratings or not. He / she has right to defend.
3. At the end of year, the rating of three quarters will be collected.
4. The performance of an employee for the whole year will be in front of his own eyes.
5. At the end of each quarter, the comments / acceptance signature of employee will also be taken on the form so to remove all the ambiguities.

REWARDING:-

On the basis of annual results collected from three quarters following can be done:-

1. Rewards and remunerations
2. Career Plans
3. Succession Planning (Annual Results only provides a step towards succession planning same results of all quarters will help in succession planning during their concerned period results. Succession Planning is an ongoing process).
4. Annual Training and Developments (T&D is itself an ongoing processes and should be linked with Performance Management System, Recruitment and Selection, Compensation and Benefits while measuring competency level) .

NOTE#1:
1.       In case an employee falls in U and NI Category his Immediate Manager / Supervisor will coach him.
2.       If the same situation continues in the 2^nd month then an informal warning is given.
3.       If the same situation continues in the 3^rd month a formal warning letter is issued whereas prolonging such performance in the 4^th Month will result in an immediate termination.

This is a complete process, which is based on the workforce performance and the fulfillment of organizational objectives at all levels.
It develops the alignment between the organizational objectives, with the employees’ skills and capabilities.
It is an ongoing process to measuring the fulfillment of objectives apart from traditional appraisal system. Therefore all managers / supervisors are expected to manage their part with much keen interests and critically.
Strategically goal setting, developing performance management system, individual accountability, rewards and recognition are some of the key elements for a quality performance management system.

Benefits of Performance Management System

Improves Productivity / Targets Achieved

Improvement comes in both the people and systems

Productivity increase in case of being aware of minute accountability.

Improve Employee Morals

On time and ongoing performance appraisal improve employee moral and self satisfaction on performance measurements. 

He is not asked at the end of year for feed back. Rather he is given chance to sign over rated criteria throughout the year which shows his self satisfaction.

Retention of Top Performers

Employee who feel accomplished in their work become loyal employees.

Increases Profitability

Loyal and satisfied employees performs higher levels of services that ultimately results in the achievement of organizational goals and customer loyalty.

Unethical Advantages are Controlled
Smart workers are controlled who uses different way to gain professional advantages.


Helps in Other HR Functions
A proper performance Management System also helps to design strategies of other HR functions like Training and Developments, Compensation and Benefits, Recruitment and Selection, Employee Relations etc.