Lucent Technologies Inc. - ProprietaryAug/00Slide 1 Driving Performance Excellence using Performance Management System & Tools Raghubar Jha.

Lucent Technologies Inc. - ProprietaryAug/00Slide 1 Driving Performance Excellence using Performance Management System & Tools Raghubar Jha

Lucent Technologies Inc. - ProprietaryAug/00Slide 2 Lucents Challenges Productivity Measurement Lucents productivity lags high-tech companies. LucentCo BCo DCo C Co A Expense Management $ Spent Expense management remains an issue. Expense No. of People Headcounts 140,000++ Involuntary Exit Rate Involuntary Exit % Involuntary exit rate of least effective performers has lagged high performance companies. Retention Retention of top talent has become a critical issue. Exit Exits often require costly packages. Time LucentCo ACo BCo CCo D

Lucent Technologies Inc. - ProprietaryAug/00Slide 3 Performance Management Practices in High Performance Companies 4Set very ambitious goals; create fast paced, high -pressure -to - perform environment 4Use pay aggressively to send messages about performance 4Target the least effective 10% - 20% for improvement or attrition 4Actually manage out least effective employees quickly

Lucent Technologies Inc. - ProprietaryAug/00Slide 4 5 Key Principles of Performance Management Process 4Colleagues understand what is expected of them and how they are measured and evaluated. 4Colleagues will know where they stand because they will be provided with on going coaching and feedback on their performance throughout the year. 4Colleagues will be given the opportunity to develop and enhance skills for their current position and for the future 4Coaches will be held accountable for demonstrating effective leadership (people management) behaviors. 4Rewards and consequences will be clearly aligned with performance.

Lucent Technologies Inc. - ProprietaryAug/00Slide 5 Global Performance Platform (GPP) (Objective-Setting) (Feedback, coaching) (Review and Evaluation) (Recognition, Reward)

Lucent Technologies Inc. - ProprietaryAug/00Slide 6 Key Result Areas: KRAs are the critical accountabilities for a position in support of the business goals. Answer the question: w hat does my organizations business plan require from my job function? Example : Expense Management, Market share, Product Development Goals/Objectives: Goals / objectives identify specific results to be achieved within each Key Result Area for a given period of time. Example : Reduce costs and lower overall expense by 10% by September 30, 2001 1. Accountability - Objective setting

Lucent Technologies Inc. - ProprietaryAug/00Slide 7 - Specific - Measurable - Agreed Upon - Realistic - Time Bound S M A R T S.M.A.R.T. Objectives

Lucent Technologies Inc. - ProprietaryAug/00Slide 8 How SMART are you ? Try this statement Improve departmental bottom line by instituting a system for overseeing purchases from outside vendor by July 11. Specific Measurable Time Bound Performance Objective Development Objective

Lucent Technologies Inc. - ProprietaryAug/00Slide 9 Types of Objectives There are two types of objectives: 4Performance objectives 4Development objectives

Lucent Technologies Inc. - ProprietaryAug/00Slide 10 Lucents Performance Objectives 4Lucent evaluates performance, based not only on what is achieved (Business Result), but also on how it is achieved (behavior). 4Hence in Lucent, Performance objectives include: - Operational / Business Objectives - Stretch / Breakthrough Objectives - GROWS Behaviors - Leadership Profile Characteristics

Lucent Technologies Inc. - ProprietaryAug/00Slide 11 Performance Objectives What is to be done Degree of accomplishment Given time period How results are to be achieved Purpose Measuring business / operation results Measuring behaviors against Lucent values An Example Achieve 100% compliance in applying the Performance Management System for the Asia Pacific Region by 31st December 2000. This will be achieved through roll-down for all countries.

Lucent Technologies Inc. - ProprietaryAug/00Slide 12 Development Objectives Colleagues will have the opportunity to learn, develop and grow in their current job and for the future Development Objectives What is to be done Degree of accomplishment Given time period How results are to be achieved Purpose Increasing skill and knowledge Present job or anticipated future opportunities An Example Complete and certified for Health and Safety Program with a minimum grade of B+ by 1st October 2000

Lucent Technologies Inc. - ProprietaryAug/00Slide 13 Assessing Development Needs Flow Chart Current Job What is your current job? Training Specialist Critical Skills What are the critical skills? Facilitation skills, writing skills, coaching skills, Handling questions and objections Key Skills What are the key skills? Problem solving, Training Needs Analysis, Training Evaluation Skills Strengths What are your strengths? Lively, Enthusiastic, Able to involve participants Enjoy Delivery Development Need What are your development needs? A three-prong approach to coaching, problem solving, handling objections as they are crucial to your success in your next-level Further Use of Strengths How to further use your strengths? Continue Training delivery Engineer opportunities to train more senior managers To work on Management Development Critical Success Factor What do you need to consider to ensure success? Time Availability Need to be more focused, be a logical thinker Action Plan What specific actions do you need to address development needs and by when? (Example: Specific Learning and Development Plan) Goal : Develop TNA skill to complement Deliveryskills by Sept 30, 2000

Lucent Technologies Inc. - ProprietaryAug/00Slide 14 Development Alternatives Development by 4Training 4____________

Lucent Technologies Inc. - ProprietaryAug/00Slide 15 Questions to Consider When Setting Objectives What key Lucent Strategies are influencing my organization? What are my key customers strategies and priorities? How does the established direction of my BU/CC influence my organization? What Lucent financial, growth and productivity goals should I consider to drive business success? What do I want to accomplish? What personal feedback have I received that I have to act on? What am I looking for in terms of my own personal growth, learning, and development? If I am coaching a team, what do I need to do to grow and develop team members? How can I improve my personal coaching and leadership skills?

Lucent Technologies Inc. - ProprietaryAug/00Slide 16 Objective Setting Worksheet

Lucent Technologies Inc. - ProprietaryAug/00Slide 17 Writing SMART Objectives Business/Operational Successfully transition IPAY system to SAP with 0 errors by May 2000 Breakthrough/Stretch By September 30, lead and implement culture change interventions creating significant value and savings of management consultant fees (elimination of non-value add work, working cross-silo and GROWS action plans) Coaching/Leadership/People Development Achieve diversity targets in fiscal 2000 100% of the colleagues in my organization have set objectives, including professional development plans Attend executive education course on finance before year end 2000.

Lucent Technologies Inc. - ProprietaryAug/00Slide 18 Breakthrough Objectives Stretch / Breakthrough Objectives are SMART+ Objectives. 4SMART+ Is about mindset 4How stretching are your goals and objectives is dependent on how willing you are to go beyond your comfort zone 4The style of writing SMART+ Objectives is no different from SMART objectives. They must be Specific, Measurable, Agreed Upon, Realistic (I.e. it is not building castle in the air), and Time Bound. 4It can be innovative, and is certainly more aggressive than operational goals.

Lucent Technologies Inc. - ProprietaryAug/00Slide 19 Breakthrough Objectives Reduce operating expenses by 10% within 1 year. Examples: Reduce operating expenses by 10% within 2 months Reduce operating expenses by 40% within 1 year.

Lucent Technologies Inc. - ProprietaryAug/00Slide 20 Pre-discussion Communication Prepare Objectives Conduct Objective-Setting Discussion Sequence of Events for Objective-setting Discussion

Lucent Technologies Inc. - ProprietaryAug/00Slide 21 The Objective & Performance Review Form

Lucent Technologies Inc. - ProprietaryAug/00Slide 22 The Objective & Performance Review Form

Lucent Technologies Inc. - ProprietaryAug/00Slide 23 Learning & Development Action Plan

Lucent Technologies Inc. - ProprietaryAug/00Slide 24 2. Engagement - Feedback, Coaching 4Coaching: Develop supportive work environment Guide employees toward accomplishing objectives 4Feedback: Positive or developmental comments about quality of work From coaches From customers/clients From colleagues 4Recognition: Special Feedback Celebrating an achievement 4Record results & examples on Objectives & Appraisal form

Lucent Technologies Inc. - ProprietaryAug/00Slide 25 3. Appraisal - Review and Evaluation 4Assess completion of objectives and sustained performance 4Assess improved behavior/performance as a result of development plan initiatives Record results & examples on Objectives & Appraisal form

Lucent Technologies Inc. - ProprietaryAug/00Slide 26 Performance Appraisal Matrix - Common Language around performance 5 (1R,1B) 5 (1R,1B) 4 (1R,2B) 4 (1R,2B) 3 (1R,3B) 3 (1R,3B) 4 (2R,1B) 4 (2R,1B) 3 (2R,2B) 3 (2R,2B) 2 (2R,3B) 2 (2R,3B) 3 (3R,1B) 3 (3R,1B) 2 (3R,2B) 2 (3R,2B) 1 (3R,3B) 1 (3R,3B) BUSINESS RESULTS GROWS BEHAVIORS and LEADERSHIP CHARACTERISTICS

Lucent Technologies Inc. - ProprietaryAug/00Slide 27 Performance Appraisal - Quick Guide for Assessment

Lucent Technologies Inc. - ProprietaryAug/00Slide 28 4.Awards - Recognition and Awards Awards can include: 4Sales Incentive/Technical Performance: based on individual/team performance 4 Unit Award: based on unit performance, may be paid out at management discretion 4Salary Increase: recognizes sustained individual performance, determined during end-of-fiscal-year appraisal

Lucent Technologies Inc. - ProprietaryAug/00Slide 29 How is performance linked to pay ? Some examples

Lucent Technologies Inc. - ProprietaryAug/00Slide 30 Performance Appraisal Matrix

Lucent Technologies Inc. - ProprietaryAug/00Slide 31 Performance Management Cycle Nov Jan Mar May July Sept Oct Dec Feb Apr June Aug SMI (Pay) Recommendation Objective Setting Development Planning Mid-Year Review Preliminary Rating Final Appraisal Year-end Performance Review Sessions Mid-Year Review Employee Accomplishment SMI effected L&D Action Plan

Lucent Technologies Inc. - ProprietaryAug/00Slide 32 Interventions to Address Ineffective Performance 1.New Employee Unacceptable Performance 43 months for FESCO employees 46 months for WOFE employees 4Confirm with HR

Lucent Technologies Inc. - ProprietaryAug/00Slide 33 Interventions to Address Ineffective Performance 2. Unacceptable Year-Long Performance All of the following: Objective defined Coaching/Feedback throughout the year Development Opportunities available Key objectives were missed All of the following: Objective defined Coaching/Feedback throughout the year Development Opportunities available Key objectives were missed One of the following: Sales Results Report Software Test Results Unacceptable CSS Unacceptable Financial Report Unacceptable Performance Appraisal One of the following: Sales Results Report Software Test Results Unacceptable CSS Unacceptable Financial Report Unacceptable Performance Appraisal + =

Lucent Technologies Inc. - ProprietaryAug/00Slide 34 Interventions to Address Ineffective Performance 2. Unacceptable Year-Long Performance Terminate employment Reassign to match abilities Demote to match abilities Terminate employment Reassign to match abilities Demote to match abilities =

Lucent Technologies Inc. - ProprietaryAug/00Slide 35 Interventions to Address Ineffective Performance 3.Performance Improvement Process (PIP) Eligibility 4Employees who expose unsatisfactory performance to the required level at any time during the fiscal year. 4Employees in probation or demonstrating unsatisfactory performance by the end of fiscal year are not appropriate in this situation

Lucent Technologies Inc. - ProprietaryAug/00Slide 36 Interventions to Address Ineffective Performance 3.Performance Improvement Process (PIP) Others 4 30-60 days 4Standard maintained 4No transfer, No SMI, No Significant training 4Once in two years

Lucent Technologies Inc. - ProprietaryAug/00Slide 37 Interventions to Address Ineffective Performance 3.Performance Improvement Process (PIP) Consequences (in line with Labor Law) 4Successful completion: go back to Objectives 4Unsuccessful completion : Reassignment to match abilities Demotion to match abilities Termination within 30 days 4Refusal: Immediate dismissal

Lucent Technologies Inc. - ProprietaryAug/00Slide 1 Driving Performance Excellence using Performance Management System & Tools Raghubar Jha.

Documents

lucent technologies

lucents performance

high performance companies

expense management

reward slide

driving performance

development objectives

goals objectives