Tuesday, April 1, 2008

Performance Management - Making Appraisals Work

I once saw a quote in a book by Tom Clancy, called "Net Force" (Published by Headline Book Publishing, a Division of Hodder Headline PLC, ISBN 0 7472 6040 0). The quote read:

"Remember the Rule of the 5Ps
- Proper Planning Prevents Poor Performance"

I could not agree more! (Actually the quote was the 6Ps - I left out the four-letter expletive that went before the word 'poor'!) In my view, the essence of the a good performance management system revolves around planning - in this case individual performance planning, derived from organisational planning. When this model is followed, not only will planned business goals be more effectively achieved, individuals will be more motivated, as they know with greater clarity than ever before, exactly what is expected of them, and what their part has been in the company's success. Organisations that are better able to reward good performances, are planning for their future success.

The Performance Management System (PMS) which I have designed for a number of companies here, has two distinct parts A and B, and is the means by which individual managerial or supervisory performance is linked to an organisation’s business objectives and operating plans (Part A) and to the organisation’s future through assessing the potential of each managerial or executive level employee(Part B). For any company to be successful every Manager must establish and agree precise, measurable and objective standards and goals for individual performance that will in turn lead to improved performance by the company as a whole.

This Performance Management System (and its sister system, covering clerical and operator level employees), is put together after many years of experience with performance management, both as a Corporate Human Resource Manager and as a Consultant. Our aim is to provide our clients with all the company needs to introduce a simple, but effective system of measuring and rewarding employee performances.
The Aims of PMS
· PMS aims to make every managerial and supervisory level employee completely aware of the company's business plans, and through the cascading of those plans to individuals, provide them with the motivation to achieve, and then, the ownership of success
· PMS is concerned with improvement - organisationally through increased contribution by each individual and personally through the broadening of experience and career opportunities.
· It aims to make the appraisal of Managers and Supervisors as fair as possible and less subjective, by focusing on planning, performance, priorities and key result areas.
· It seeks to provide rigorous and current information about an executive in order to activate appropriate training and development opportunities and to facilitate career progression.
The Role of PMS
PMS is central not only to a need to develop, train and motivate employees, but also to its continued business success. It provides a structure to focus the resources and activities of all Managers on achieving the company's major business objectives. PMS is the basis for assessment of performance, ability and potential and an essential source of data on employees for manpower and succession planning purposes.

Completion of Parts A and B are separated in time by six months. When the two quite different objectives of each part are separated in time, experience of many major companies has been that far more effective attention is given to the assessment of individuals’ potential, development and training needs.

However, if a company so chooses, there is nothing to prevent them carrying out Parts A and B at the same time, say both at the end of the year. But we do urge such companies to hold two separate discussions between Appraiser and Appraisee, in order that sufficient focus is directed to the employee's longer-term potential and training and development needs.
There is so much that can be said and written about performance appraisals, and I'll let this suffice for now, but will return to the topic again in the future.

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