Performance Management System

MEANING OF THE TERM “PERFORMANCE”

The term “PERFORMANCE” is both distinguishing and similar to the term “PRODUCTIVITY”:

SIMILAR:- effective and efficient use of resources to achieve outcomes

DISTINGUISHING:- it is guided and assessed by multiple, equally important standards of effectiveness, efficiency and equity.

SCOPE OF PERFORMANCE MANAGEMENT SYSTEM

• Identifying the parameters of performance and stating them very clearly;

• Setting performance standards;• Planning in participative ways where

appropriate, performance of all constituents;• Identifying competencies and competency

gaps that contribute/hinder to performance;• Planning performance development activities;• Creating ownership;• Recognizing and promoting performance

culture;

OBJECTIVES OF PERFORMANCE MANAGEMENT

Performance management is the process of identifying, evaluating and developing the work performance of employees so that the company’s goals and objectives are more effectively achieved. Effective performance management is designed to enhance performance, identify performance requirements, provide feedback relevant to those requirements and assist with career development.

The primary objectives of performance management are:• to assist in the achievement of enhanced standards of work

performance of an employee or class of employees;• to assist employees to identify knowledge and skills to perform

their job efficiently;• for employees to work towards defined goals;• for employees to receive regular feedback on performance; and• for employees to achieve personal growth through acquiring

relevant knowledge and skills and attitudes.

The management of medical incapacity, inability to discharge duties and disciplinary processes are separate from a company’s performance management system and are to be seen as separate.

PRE-REQUISITES OF PMS PROCESS

• Policy specific procedures to be followed in order to manage performance;

• Company shall adopt performance management practices that are consistent with the company policy, best fit the nature of the work performed and the mission of the organization;

PHASE 1 Setting expectations for

employee performance;• supervisors shall meet with their employees,

establish expectations regarding their employees’ performance, specify how employees’ actual performance will be measured and their success determined, and impart to them an understanding of how meeting these expectations will contribute to the achievement of the organization’s mission.

• Performance expectations shall be written at the “meets expectations” level (the midpoint of the state rating scale) and shall be documented on a form defined by the Company – the “work plan.”

• Work plans shall be signed and dated by both the supervisor and the employee.

PHASE 2

Maintaining a dialogue between supervisor and employee to keep performance on track

• Employees shall be responsible for meeting their performance expectations.

• Progress toward meeting expectations shall be measured, reported, discussed, and documented throughout the work cycle.

• supervisors are expected to use appropriate techniques to support employee efforts to meet or exceed their performance expectations.

• When expectations change during the course of the work cycle, supervisors shall communicate these changes and modify work plans as necessary. Modifications shall be signed and dated by both the supervisor and the employee.

PHASE 3

Maintaining a dialogue between supervisor and employee to keep performance on track;

• At the end of the work cycle, supervisors shall evaluate employees’ performance during the past year compared to their performance expectations. They shall use verifiable information collected and documented throughout the cycle to determine the extent to which actual performance has met the expectations defined in the work plan.

• The evaluation shall be documented on a standard form defined by the company – the “appraisal form.”

• The annual performance appraisal shall use a 5-level rating scale for reporting overall performance. A rating at the midpoint of the scale shall indicate that an employee’s performance has met expectations.

• Prior to discussing a completed performance appraisal (that is, an appraisal containing ratings and descriptions of actual performance) with an employee, a supervisor shall review the appraisal with the next-level manager to ensure that ratings are appropriate and consistent.

• supervisors shall discuss the appraisals with their employees. Both supervisor and employee shall sign and date the completed performance appraisal indicating that the discussion has taken place.

ADDRESSING POOR PERFORMANCE

When an employee’s performance falls below expectations at any time during the performance cycle:

• The supervisor shall document the performance that falls short of expectations by preparing a corrective action plan or other documentation. The documentation will specify (a) the performance problem, (b) the steps to be taken to improve performance, including the timeframe for improvement, (c) the consequences of failure to improve, and (d) a follow-up date.

• A corrective action plan shall be considered successfully completed only when the employee’s actual performance has improved to the point where expectations are being met.

• The agency’s performance management policy shall specify the relationship between disciplinary policy and performance management.

• Performance deficiencies that occur during the performance cycle shall be referenced in the annual performance appraisal.

SUPPORTING EMPLOYEE DEVELOPMENT

Many employees may express interest in growing in their current positions or in furthering their careers within the organization. supervisors shall work with them to identify strengths and weaknesses and, if appropriate, to help them prepare an individual development plan. Individual development plans may specify how employees can more fully apply their strengths in their current positions, build up areas of weakness, enhance their performance in their current positions, or develop the skills and experience they will need for possible future assignments.

TRANSITIONS When employees move into or out of their positions, relevant

performance information shall be communicated in a timely way:

• Probationary employees shall have work plans within a certain number of days of their date of employment. To remove an employee from probationary status, the supervisor shall provide performance documentation, as per the policy, that the probationary employee’s performance is at minimum meeting expectations.

• Employees in training progressions shall have work plans, or an equivalent document that describes performance expectations, within a certain number of days of the date of employment. The supervisor shall provide performance documentation that performance at minimum meets expectations before each salary increase is granted within the progression.

• Employees whose responsibilities are changed substantially, either within their current position or by transfer (promotion, lateral transfer, or demotion), shall have work plans established within a certain number of days (set by the agency) following the new assignment.

• When an employee transfers from one site to another or from corporate office to site and vice versa, the releasing department/site/office shall send to the receiving department/site/office performance documentation summarizing the employee’s performance from the last appraisal up to the date of transfer. This performance documentation shall be provided before the employee’s first day with the receiving department/site/office. The receiving supervisor may use this performance documentation when completing the employee’s end-of-cycle appraisal.

• When an supervisor leaves a work unit, the next-level supervisor shall ensure that performance documentation concerning the employees supervised by the departing supervisor is made available to the employees’ new supervisor.

PERFORMANCE MANAGEMENT CYCLE

The Performance, Management, Measurement and Information approach PERFORMANCE MANAGEMENT is based on the plan-do-review-revise cycle:

A. Plan: - Understanding current performance, prioritizing what needs to be done, identifying actions that need to be taken and planning for the improvement;

B. Do: - Ensuring that the proper systems and processes are in place to support improvement, take action and manage risk – and helping people achieve better performance;

C. Review: - Understanding the impact of your actions, reviewing performance, speaking to users and stakeholders about their experience of performance and getting a better picture of changing circumstances;

D. Revise: - Using the lessons learned from review to change

your plans or what you do so that future action is more efficient, effective and appropriate.

Plan-Do-Review-Revise Cycle of Performance Management

Plan-Do-Review-Revise Cycle of Performance Management takes place at various levels over different timescales

PLANNING

SETTING OBJECTIVES:

Planning employees' performance involves establishing the standards or measures like KRAs, value system, ethics, and performance factors, which guide an employee’s appraisal. For an employee, performance objectives (in form of KRAs & IDP) shall be developed in line with the respective department’s/ project/groups objectives

DOING

COMPETENCY DEVELOPMENT: Doing involves evaluating employee developmental needs that will help them

strengthen their job-related skills and competencies, and prioritizing and developing a plan of action to achieve the set targets.

REVIEWCHECKING (Continuous Monitoring):

Checking includes conducting ongoing reviews where employees’ performance is quantitatively

measured against the set standards to identify how well the employees are meeting the set goals. Thereafter, the quantitative data is used to derive performance rating during the appraisal period. For low performance, an immediate plan of action is taken rather than wait until the end of the appraisal period when summary rating levels are assigned.

Acting (Performance Evaluation)• Acting includes evaluating job performance against the standards in the employee’s

performance plan and assigning a rating to the employee based on work performed during the entire appraisal period.

HIERARCHY OF PERFORMANCE INDICATORS

POTENTIAL PERFORMANCE MANAGEMENT DRIVERS

Formal Performance Review

•Emphasis on performanceStrengths

• Emphasis on performanceWeaknesses

• Emphasis on personality strengths

• Emphasis on personalityWeaknesses

• Emphasis on skills andbehaviors needed in the future

• Emphasis on specific outcomes of formal performance review(e.g., promotions, raises, or bonuses)

• Emphasis on specific suggestions for doing the job better

• Emphasis on long-term careerprospects within the organization

Performance Culture

• Coworker Involvement

• Diffuse decision making authority

• Risk taking

• Coworker cohesion

• Innovation

• Flexibility

• Differential treatment of best and worst Performers

• Internal Communication

• Future orientation

Informal Performance Feedback

• Emphasis on amount of effort put into the job

• Emphasis on performance strengths

• Emphasis on performance weaknesses

• Emphasis on personality strengths

• Emphasis on personality weaknesses

• Emphasis on skills and behaviors needed in the future

• Emphasis on specific suggestions for doing the job better

• Fairness and accuracy of informal Feedback

• Feedback that helps employees do their jobs better

• Immediate versus delayed feedback

• Manager likelihood to volunteer Informal feedback

• Method of delivering informal feedback (e.g., face-to-face, in writing)

• Manager knowledgeable about Employee performance

Performance Management System

• Challenge and applicability of development plan

• Employees’ accountability for “things that matter”

• Employee understanding of how system works

• Employee understanding of performance standards

• Extent to which employees receive performance ratings they deserve

• Fairness of performance standards

• Link between performance management systemand organizational strategy

• Number of formal reviews received each year

• Presence of multi rater feedback

• Presence of employee development plan

• Presence of procedures for handling grievanceswith performance reviews

• System credibility

• Use of rank-ordering

POTENTIAL PERFORMANCE MANAGEMENT DRIVERS

Manager–Employee Interaction

• Breaks down projects into manageable components

• Clearly communicates expectations

• Creates work plans and timetables

• Diffuses unhealthy rivalries or competition among team members

• Encourages employees to be positive and enthusiastic about work

• Expresses confidence in employees’ ability to do job

• Helps team get started on a new project

• Helps attain needed information, resources and Technology

• Helps find solutions to problems at work

• Holds people accountable

• Identifies or removes unnecessary barriers at work (such as unnecessary rules or regulations)

• Listens carefully to views and opinions

• Measures performance and results

• Persuades and encourages others to move in a desired direction

• Recognizes and rewards achievement

• Translates long-term goals into step-by-step plans

• Makes frequent changes to projects and assignments

Job Opportunities

On-the-Job Development Opportunities

Opportunity to:• Spend time with a professional coach• Do challenging and leading-edge work• Experiment and take risks• Have significant accountability and responsibility• Help launch a new business, initiative, or program• Help turn around struggling business• Work with a mentor• Be promoted• Work for strong senior executive team• Work in a different country• Work in a variety of jobs/roles• Work in new business units• Work in new functional areas• Work on the things you do best• Work with a diverse group of people

Training• Training content– Business (e.g., accounting, finance)– Diversity– IT– Leadership– New employee orientation– People management (e.g.,communication, teambuilding)– Process management (e.g.,managing timelines or budgets,resource allocation)– Product– Quality control– Sales– Technical– Other

Day-to-Day Work

• Challenge of projects and assignments

• Connection between successful project completion and incentives such as the following:– Size of annual merit increase– Size of annual bonus– Opportunity for higher performance rating– Opportunity for promotion– Raise in base salary

• Employee influence in selecting projects

• Employees’ personal enjoyment of their work

• Employee understanding of connections between day-to-day work and organizational strategy

• Employee understanding of how to complete projects and assignments

• Importance of projects to business unit andOrganization

• Importance of projects and assignments to employees’ long-term careers

• Importance of projects and assignments to employees’ personal development

• Number of projects and assignments

• Time to complete projects and assignments

TARGETING IMPROVEMENT One of the most important actionable improvement tool of

Performance Management System is “target”. Targets specify time-bound levels for improvement and are usually based around a particular performance indicator. Targets are a tool for improving performance against a particular measure over a given period of time. Not all activities or measures are appropriate for targets.

Well designed targets are often described as SMART: Specific

Measurable AchievableRealisticTime-bound

Understanding how you want to use a target will help you

design and plan for its achievement. Using a target for more than one reason may be confusing or counter-productive. For example, do not use the same measure for an aspirational goal, which may not be fully met, and an accountable goal, which will attract consequences if it is not achieved.

PERFORMANCE MANAGEMENT TO PERFORMANCE IMPROVEMENT

THE FIRST AREA OF FOCUS

From Performance Management to Performance Improvement

OrganizationManager

Performance Management System

Informal FeedbackFormal Review

Manager- Employee interaction

Points to be Considered:

From Performance ManagementTo Performance Improvement

Identifying the True Drivers of Performance

Leveraging Practices That Drive High

Performance

• Companies need to expand the definition of Performance Management to include the most drivers of employees performance;

• There are a vast number of potential levers that the organization can pull to improve performance;

• Improving performance depends on a different factors coming together at once; manager should approach it as portfolio strategy, not a single solution.

• Companies should align goals horizontally before cascading them vertically across the organization; whenever possible, employees should have greater ownership and involvement in defining and planning their stretch goals;

• When up skilling managers for performance improvement and coaching, companies should create ample opportunities for knowledge sharing across the managerial bench, and develop mechanism that measure manager performance on people development activities;

• The effectiveness of performance management system depends upon the quality of the activities and not the quantity; focus measurements and metrics on the quality of interactions, rather than on compliance or any other quantity metrics.

FACTORS TO BE CONSIDERED WHEN SEEKING PERFORMANCE

• adequacy of supervision;• organizational factors such as job definition, job design, induction, adequate

evaluation and feedback;• proper matching of people and jobs (improved selection techniques);• possession of necessary skills to perform the tasks efficiently;• interpersonal relationships within the immediate or work related area;• personal/family circumstances; • medical considerations;• a process that does not disadvantage, devalue or discriminate against any

individual on the basis of gender, cultural background or any other attribute not relevant to the workplace;

• a process that ensures complete confidentiality of all documentation associated with the planning and review of any employee’s performance;

• a consistent link between the goals and objectives set for the agency and the employee;

• a clear statement of goals and objectives for each employee at the beginning of each evaluation period and the provision of feedback on individual performance against the set objectives;

• an identification of attitudes, knowledge and skills for effective individual performance and plans for staff to undertake relevant training, education and development programs; and

• timely evaluations which reflect a fair assessment of an employee’s performance during the specified period based on the set objectives.

A good performance management system will help identify such factors and an integrated approach to personnel management within an agency should provide mechanisms for dealing with them.

HANDLING GRIEVANCES THE "WHO, WHAT, WHEN, WHERE, AND WHY" OF

GRIEVANCES: One of a supervisor's most important jobs is to handle, and settle grievances. Often,

however, supervisors fail to document a grievance properly with the result the Company may lose factual information. When this happens, the employee may not get the relief he is entitled to, or, the Company may be faced with unnecessary costs. If every supervisor knew and understood the basics of grievance investigation, they would be more effective supervisors. Always check for the following:

WHO : is involved in the grievance, name or names, check or department number, and seniority date? Don't forget the steward or Union representative who may be involved.

WHEN : did the grievance occur? Date and time, day of week, exact time when act or omission took place, which created the grievance.

WHERE : did the grievance occur? Exact location, department, machine, aisle, etc.

WHY : is this a grievance? What has been violated the contract, supplement, past practice, law, ruling or awards, personal rights, etc.?

WHAT : happened that caused the violation? Improper layoff or recall? Improper promotion or transfer, etc.? What adjustment is necessary to completely correct the alleged injustice, to place the aggrieved in the same position he would have been in had not the grievance occurred? What, if any, is the total liability to the Company?

HANDLING GRIEVANCES

The grievance handling procedure of the organization can affect the harmonious

environment of the organization.  The grievances of the employees are related to the contract, work rule or regulation, policy or procedure, health and safety regulation, past practice, changing the cultural norms unilaterally, individual victimization, wage, bonus, etc. Here, the attitude on the part of management in their effort to understand the problems of employees and resolve the issues amicably have better probability to maintain a culture of high performance. Managers must be educated about the importance of the grievance process and their role in maintaining favorable relations with the union, if any. Effective grievance handling is an essential part of cultivating good employee relations and running a fair, successful, and productive workplace. Positive labor relations are two-way street both sides must give a little and try to work together. Relationship building is key to successful labor relations.

To a great extend the aggravation of industrial problems depends on manager's approaches and attitude in effective handling of employees grievances. Care should be taken in the way managers approaches the problem and perceiving the pros and cons of the situation. The conflict management approaches include the win-win strategy that help in the healthy organizational practices and which reflects the strong organizational culture. The cooperation from both parties is the pre-requisite to handle the problem and effective settlement of the grievances. Conscious use of professional self can help managers in the conflict handling situations grievance redressal process.

GRIEVANCE PROCEDURE In working together from day to day, it is normal for employees to occasionally have problems or

complaints affecting their work-related activities. It is important to work out a solution to these problems as quickly as possible. Most problems can be resolved through informal discussions between employee and supervisor in the department. You are encouraged to talk about work-related problems with your immediate supervisor. If you are not satisfied with the outcome, you may wish to use a more formal process ”the grievance procedure” - to seek a solution.

Who can file a grievance? All staff employees can file a grievance whether appointed or hourly, professional or support and

service. New employees who have not completed their new employee evaluation period do not have access to the grievance procedure for issues concerning corrective action, layoff, or termination. You may exercise your right to file a grievance without fear of retaliation, harassment or negative impact on your employment relationship with the company. Grievances are confidential and are not included in your personnel file.

When do I file a grievance? The grievance procedure has time limitations, which are outlined at each stage of the process.

These time limits may be extended if both parties agree to the additional time needed. How do I file a grievance? At first, you may want to talk to your supervisor about your complaint/problem and try to resolve

the matter in the department where you work. Grievances must be presented in writing, and you may use a grievance form. You can get a form online or you can pick up the form at Human Resources Administration (HRA). Complete the appropriate sections of the grievance form and present it to your immediate supervisor. You are allowed to have someone help you file a grievance and state your complaint during a grievance meeting. This person is called a representative and usually is someone with whom you feel comfortable - a coworker or union steward, for example. You and your representative will be allowed a reasonable amount of time during working hours to attend the grievance meetings. You must get prior approval from your supervisor for this time away from your job. You will be paid for time spent in formal grievance meetings. Time spent preparing your grievance is without pay and is to be done outside your working hours.

GRIEVANCE STAGES STAGE 1: • If you decide to file a grievance, you must do so within stated time period from the time of your knowledge

of the situation causing the grievance. For example, on August 15, your supervisor talks with you about your poor attendance and informs you that you will receive a "write up" (disciplinary action). On August 17 you receive a copy of the written warning. You had knowledge of the disciplinary action on August 15 when your supervisor spoke with you.

• Your complaint or problem is first directed to the immediate supervisor with a copy to Human Resources. Human Resources will inform you and your supervisor if the issue is appropriate for the grievance procedure. You and the supervisor will try to resolve the complaint or problem by meeting to talk about your concerns. The supervisor has stated working days (not counting weekends and holidays) to reply. The supervisor must forward a copy of his or her written response to you and Human Resources. If the supervisor's response is unsatisfactory to you, or if you do not receive a response with the five-day timeframe, you may appeal to Stage 2.

Exception to Stage 1: - If you are grieving a termination, skip to Stage 2. Human Resources may elevate the initial filing of any grievance to Stage 2 or Stage 3 if it is appropriate to do so.

STAGE 2:• If you wish to proceed to Stage 2, you must do so during your next stated working days following the

response at Stage 1. The grievance is directed to the HOD of the immediate supervisor. The HOD has stated working days (not counting weekends and holidays) to attempt to resolve the grievance and to respond to you. If the HOD’s response is unsatisfactory to you, or if you do not receive a response within the five-day timeframe, you may appeal to Stage 3.

STAGE 3:• If you wish to continue your grievance, the response at Stage 2 must be appealed in writing during your next

stated working days (not counting weekends and holidays) to the Manager of Employee Relations and Benefits or designee in Human Resources. If you do not receive an answer at Stage 2, Human Resources will request a final decision from the HOD in writing. Human resources will try to resolve your grievance and will respond to you within stated working days. The response may be final, or, in some situations if you are not satisfied with the response, you may choose to go on to Stage 3.5 or 4.

GRIEVANCE STAGES

STAGE 3.5: You may ask for a committee review of your grievance if the following conditions are met:• You are an appointed service or maintenance employee beyond your new hire

probationary period. • The grievance issue is a termination of your employment or a violation of Human

Resources Policy. • The Stage 3 response is unsatisfactory to you. • You appeal in writing to the Head of Human Resources or a designee in Human

Resources within stated working days of receiving the Stage 3 response.

STAGE 4: A grievance can be appealed to Stage 4 is all of the following conditions are met:• You are an appointed beyond your new hire probationary period. • The grievance issue is a termination of your employment or a violation of Human

Resources Policy. • The Stage 3 response is unsatisfactory to you. • You appeal in writing to the Head of Human Resources or a designee in Human

Resources within stated working days of receiving the Stage 3 response. • Stage 4 of the grievance procedure is very detailed. Following your request for a Stage

4 hearing, a meeting will be scheduled with Human Resources to discuss the full details of this hearing.

REFERENCE

• http://www.osp.state.nc.us/manuals/manual99/pms.pdf

• http://www.empxtrack.com/performance-management-system/

• http://www.idea.gov.uk/idk/core/page.do?pageId=4405789